Zhou X (A) v. The Administration Commission of Huzhou Economic and Technological Development Zone, Zhejiang Province (Dispute over Administrative Compensation for Housing Demolition and Resettlement): Understanding of the “Direct Loss” in Subparagraph 8 of Article 36 of the State Compensation Law

1. Pursusant to the Subparagraph 8 of Article 36 of Law of the People’s Republic of China on State Compensation, if other damage is done as a result of infringement on the property rights of a citizen, a legal person, or other organizations, compensation shall be paid for the direct losses. When it comes to land or house expropriation and demolition, and when determining the scope and amount of compensation for illegal demolition by the administrative agency, the “direct losses” stipulated in Law of the People’s Republic of China on State Compensation cannot be simply interpreted as the losses resulted from resettlement of the demolished houses, excluding the indemnity rights and interests that owners of the demolished houses should enjoy in the demolition and resettlement of rural houses. The abovementioned “direct losses” should be inclusive of both the loss from resettlement (i.e. the cost) after the demolition of houses and the indemnity rights and interests that owners of the demolished houses should enjoy in the demolition and resettlement of rural houses.