UNDERGROUND LAND OWNERSHIP IN MALAYSIA: A REVIEW PDF

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Jurnal Pentadbiran Tanah, 2013 UNDERGROUND LAND OWNERSHIP IN MALAYSIA: A REVIEW Farah Zaini1, Khadijah Hussin2, Robiah Suratman3, Kamaruzaman Abd Rasid4 1, 2, 3, 4 Department of Real Estate, Faculty of Geoinformation and Real Estate, Universiti Teknologi Malaysia, Skudai, Johor, Malaysia E-mail: far...

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UNDERGROUND LAND OWNERSHIP IN MALAYSIA: A REVIEW Robiah Suratman, Farah Zaini Jurnal Pentadbiran Tanah, Volume 3

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Jurnal Pentadbiran Tanah, 2013

UNDERGROUND LAND OWNERSHIP IN MALAYSIA: A REVIEW Farah Zaini1, Khadijah Hussin2, Robiah Suratman3, Kamaruzaman Abd Rasid4 1, 2, 3, 4 Department of Real Estate, Faculty of Geoinformation and Real Estate, Universiti Teknologi Malaysia, Skudai, Johor, Malaysia E-mail: [email protected] Abstract: In order to maximize the land utilization in Malaysia, the National Land Code 1965 (NLC 1965) was amended to insert a Part Five (A) to enable the State Authority to dispose underground land and gives State Authorities a clear power to dispose underground land for new cases of land disposal. Along with that, Federal Land and Mines Office (JKPTG) have also issued a circulation for the same purpose which is to provide a basis for the legal framework for underground land development. The circulation also specified the minimum depth of stratum development should according to the category of land. Under these circumstances, there are limitations on the surface ownership because before the amendment, landowners have the right to; “exclusive use and enjoyment of only so much of the land below that surface as is reasonably necessary to the lawful use and enjoyment of the land” under Section 44 (1) (a) NLC 1965. Recently, there are many arguments arise especially in terms of ownership. For underground land, the depth is considered as boundaries of surface and underground ownership. Since the legislations provided today are still ambiguous, there is an urgent need to define the ownership and the feasible depth of underground land development. Therefore, this paper is attempting to discuss the legal implementation of underground land in Malaysia. From the investigation, it is expected to assist in finding solutions in legal and administrative consideration for underground land development in Malaysia. Keywords: Ownership, Underground Land, National Land Code 1965, JKPTG Circulation No.1/2008

I INTRODUCTION Even though Malaysian citizen may still not familiarize with the underground land development, but with the establishment of shop lots below the Merdeka Square, sixteen years ago, followed by Petronas Twin Towers, Light Rail Transit, Storm water Management and Road Tunnel (SMART) (Megat Mohd Ghazali, et al., 2000) and the most recent is the on-going project of the Mass Rapid Transit (MRT) project has shown that Malaysia is also participate in underground land development. Most of underground land developments are currently focusing only on infrastructure and utility purposes. Therefore, we are not yet exploiting the use of urban underground land to its limit even though we have the chance to do so in a way to maximize the land resource. Realizing the urgent need to maximize the utilization of the land in Malaysia, the National Land Code 1965 was amended to insert a new part which is to enable State Authority to dispose land in third dimension. With the new amendment in National Land Code 1965, disposal of underground land was gazette on 22nd February 1990. One special part has been created entitled Disposal of Underground Land under “Part Five (A)” in the NLC 1965 regarding disposal of underground land and other things related to the matter. Besides, the new amendment allows land to be disposed in the form of three-dimensional (3D), which also take into account the length, width and depth; calculated in the volume size. This was a significant addition to the NLC 1965 in order to make it sustain with current trends and new needs in land utilization, land tenure system and construction technology. Along with that, Federal Land and Mines Office (JKPTG) has also issued Circulation of Director General of Land and Mines (Federal) No 1/2008 (Guideline of Underground Land Disposal Implementation Under National Land Code 1965) for the same purpose which to provide a basis for the legal framework of underground land development (Farah Zaini, et al., 2012). Furthermore, it does allow underground land to be developed without disturbing the surface ownership. Before the amendments, any development on the surface encounters two dimensions which are length and width. With the additional dimension which is depth to the development, underground land seems to look as an option for urban development to supply the land usage demand.

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II UNDERSTANDING THE CONCEPT OF UNDERGROUND LAND One way of dealing with the problems of urban space scarcity is by building upwards. Indeed high- rise buildings have for years been the example of how to create more space on a limited amount of land. Because of the urbanization growth, economic development and requirements as well as increases in mobility, cities all over the world face serious dilemmas concerning the efficient public urban transportation and other utility demand (F. C. Chow, et al., 2002). Lack of urban space for the development on the surface, more and more developments are taking place exclusively under the ground (Goel, et al., 2012). The development of underground land is imperative for cities because the spatial planning for infrastructure and buildings has become even more difficult in urban areas. Thus, before we involve directly in underground land development, the concept of underground land need to define clearly in order to ensure that all the issues related to this matter can be tackled and solved thoroughly. According to Section 5 of the National Land Code 1965, the land is defined as: i. ii. iii. iv. v.

The surface of the earth and all substances forming that surface; The earth below the surface and all substances therein; All vegetation and other natural products, whether or not requiring the periodical application of labour to their production and whether on or below the surface; All things attached to the earth or permanently fastened to anything attached to the earth, whether on or below the surface; and The land covered by water

Based on the definition, the term of land includes not only the surface of the earth and all things that formed the surface, but it also includes land under the surface of the earth and all that is therein, all the plants and other natural produce either above or below the surface of the earth, all things latched or fastened permanently at anything on earth and land surrounded by water. However, this does not mean that the owner have a right to everything on the ground because there are also include exception. For example, the mineral belongs to the state and not to the landowner. Meanwhile, underground land is refers to a space that is situated below the ground level (Ronka, et al., 1998). Section 92A National Land Code 1965 has defined the meaning of adjoining underground land, stratum and underground land as follows: i. Adjoining underground land means underground land adjoining a stratum above, below and on the sides of the stratum. ii. Stratum means a cubic layer of underground land. iii. Underground land means land which lies below the surface of the earth. On the other hand, according to the circular issued by JKPTG No. 1 / 2008 on the disposal of the underground land, they define stratum as the underground land which identified for the purpose of disposal as an independent use and not related with the above usage. Both provisions in NLC 1965 and circular JKPTG No. 1/2008 should be read together to get a clear picture of stratum development in Malaysia. Based on both definitions, it can be conclude that there is a different between stratum and underground land. The underground land refer to anything that below the surface until the earth, meanwhile, stratum is in the cubic form in underground land which have the specific measurement in height, width and depth. Currently, the legislation related on underground land in Malaysia is focusing more on stratum not underground land respectively as illustrated in Figure 1.

Jurnal Pentadbiran Tanah, 2013 Agriculture Land

Building Land

Industrial Land

Stratum

Underground Land

Figure 1: Underground Land and Stratum Illustration

III OWNERSHIP OF UNDERGROUND LAND In common law, the maxim applied are; cujus est solum eius est usque ad caelum ad inferos, which mean “The owner of the surface also owns to the sky and to the depths.” This extension of surface ownership was common in British, French, Germanic, Jewish and Roman law and was cited as early as 1250 AD (Thomas, 1979 in ( Barker, M., 1991)). Meanwhile, in Malaysia, followed by Section 44(1) (a) National Land Code, the rights of the proprietor of any alienated land was limited to the “exclusive use and enjoyment of only so much of the land below that surface as is reasonably necessary to the lawful use and enjoyment of the land”. There is nothing specific as to how deep the land owner own the land (Megat Mohd Ghazali, et al., 2000). Therefore, land owner can utilize the land as deep as he wants with full exclusiveness and stated in the law. a) National Land Code 1965 As has been noted, NLC 1965 has provided one special part which is Part VA for underground land development. The surface land may be used for residential or commercial purposes while the land below may be used for industrial or even agricultural purposes. Technological advances have made it possible to have many different types of uses simultaneously above and below one another without disastrous consequences. If there is a need to use the underground land, that is technically feasible and safety assured, then the State Authority will consider favourably the applications made under Part Five (A) of the NLC. i) Utilization of Underground Land The uses to which underground land can be put into are specified in section 92B (3). The surface land owner can use the underground land for a purpose that complements the surface use; „such use as is reasonably necessary to the lawful use and enjoyment of the surface of the alienated land‟ (Section 92 (3) (a)). Meanwhile, according to Section 92B(3) (b), underground land can be used, which is independent of an unrelated to any lawful use to which the surface of the alienated land may at any time be put, or any category of the land use, or any express conditions, to which the alienated land is subject. The underground land can be used in whatever way the proprietor wishes after obtaining the approval from the State Authority. Section 92C (2) (a) also allows different uses for different parts of the underground land. Besides, State Authority can specify the depth to which extend the land directly and immediately below may be used, but different depths may be specified in respect to different parts of the underground land.

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It is also similar to the provisions for the independent and unrelated use under section 92G, which is permit for underground reserved land. The lessee of any reserved land may make his application under the above section. Underground land that has been reserved for public purposes may no longer be left to remain idle. The land below such reserved land can be utilized for a variety of uses without adverse effect on the surface land. ii) Depth of Underground Land Upon the alienation of any State Land or lease of reserved land, the State Authority can specify the depth to which extend the land directly and immediately below may be used, and different depths may be specified in respect to different parts of the underground land. The specified depth is unlikely to be uniform but will vary according to the locality, types of sub-surface soils or rocks, the use of the surface land and other safety considerations. The state authority has to determine all these terms and conditions in order to make sure that the underground land can be used for the intended purposes. Conditions for adequate safety features will also be imposed so that the underground land will be very safe and does not become a threat to public safety. b) JKPTG Circulation No 1/2008 (Guideline of Underground Land Disposal Implementation Under National Land Code 1965) In brief, the owner of the surface land has the rights under the NLC 1965 for the surface and below surface. The depth of the underground ownership can be specified in the title by the Land Administrator or it may not be so. However the minimum depth is valid only for the fresh alienation of surface land, while for the alienation of surface land without the minimum depth, the underground land still can be alienated but only by the surface landowner. Under the JKPTG Circulation No1/2008, the depth of the ownership shall not be less than 6 metres in the case of agricultural lands and in case of building category or industrial it shall not be less than 10 or 15 meters (refer to Table 1 and Figure 2 respectively); but these guidelines however do not apply to alienations granted before the year 2008. Table 1: Minimum Depth of Stratum Disposal Type of Application

Stratum

Class/Land Category

Section 92B NLC 1965

Agriculture 6 meter

Building 10 meter

Industrial 15 meter

Section 92E NLC 1965

6 meter

10 meter

15 meter

Source: JKPTG Circulation No 1/2008 (2008)

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Figure 2: Minimum Depth of Underground Disposal of Land Source: JKPTG Circulation No 1/2008 (2008) However, the minimum depth is valid only for the fresh alienation. Meanwhile for the alienation without the minimum depth by State Authority, the stratum title can be applied, but limited only by owner for the surface land. Depth in various countries for underground land development becomes a major issue and commonly relating to ownership of surface and underground land and restrictions on its development (Barker, M., 1991; Ronka, et al., 1998; Goel, et al., 2012; Nur Airina Mazlan, 2012; R. Sterling, 2012 ). Since all the country have its own national territories, local jurisdictions and private ownership are normally defined in terms of boundaries of surface land area, but it is different for underground land case. Therefore, it is necessary for both underground land use and use of airspaces to define how surface ownership extends downward to the underground and upward to the sky (Goel, et al., 2012). Underground land allow many functions whether dependant and independent of the surface land above, thus, the questions often arises to what extent does the surface land use regulations should apply to the development of underground land (Barker, M., 1991). This is because the depth at which underground land is constructed usually will constitute another complicating factor.

IV LEGAL CONSIDERATION IN UNDERGROUND LAND IN OTHER COUNTRY The development and utilization of urban underground land has increased tremendously and rapidly, so does the underground land related to legal construction (Shengyu & Xiancheng, 2012). Since underground land development comes later in the urban planning, the legal implementation with it must be integrated with the surface space. Legislation is gazette follow the need and situation

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of underground land in the country. The reviews of the countries which actively utilize the underground land as an option for the development are as follows: a) Singapore (ARUP, 2011; Singapore Land Transport and Authority, 2011; Lui, Zhao, & Zhou, 2012) Singapore is one of the countries in the world that are actively utilizing the underground land for development due to the limitation of space. Singapore land area covers 710 km² and land reclamation are also has been carried out extensively in the past. With a growing population reaching nearly 5 million, land availability is a key issue. Land owner in Singapore also owns the underground land in the specific area that has been defined in government plan or gazette. In 2010, the Economic Strategies Committee reported that in the next 10 years, the government should seek to catalyze the development of underground land as a means to intensify land use. Currently, Singapore is developing a master plan for underground land use to ensure that the land underground and the surface land is synergized. b) China (Shengyu & Xiancheng, 2012) China is one of the countries in the world that tremendously utilize underground land especially in term of transportation. According to the statistics, underground track traffic lines opened to traffic all over China before 2010 were up to more than 1,200 km and in average of 180km line constructed annually. This statistic is expected to increase year by year based to the demand towards quality living. In China, land and the underground are publicly owned, but the right of use belongs to every factory, school and others. Besides, the underground land in China can be developed by any favourable party, but still the state retains the proprietary right. Moreover, the land use zoning also extends to underground land without any limits. However, being inappropriate to the rapidly growing development and utilization, China is still at a preliminary stage in legal construction for urban underground land development and utilization, which is restricted by laggard legal systems. Until July 2011, China has promulgated 32 laws and rules for legal and administrative implementation in underground land development. The laws and rules are divided into two types; the first type aims of the administration on comprehensive development and utilization of urban underground land. The second type is aimed at some section or aspect in administration on the development and utilization of urban underground land. c) Finland (ARUP, 2011; Li, Parriaux, & Thalman, 2012) Helsinki, Finland is one of the best practices for underground land development in the world. Realizing the importance of underground land, the research on policy of the development has started since 1955 in database building. Following in 1996 is the feasibility study of underground land. To enhance the regulatory framework, working group on 3D property cadastral system has started in 2006. By 2009, the Helsinki Underground Master Plan was introduced with an objective to ensure the utilization of bedrock resources is retained for the construction of public long-term projects and underground lands are well connected to each other. The master plan contains the detailed mapping of existing planned facilities and potential Geo-space, public acquisition land and legalization of underground land utilization. In order to ensure it is possible to develop underground land in the future without any major conflicts, the city has set up the strategy for land ownership. The city will try to buy the needed Greenfield land that has potential to build underground before zoning through voluntary transactions. This is because it‟s a lot easier to develop underground resources under the state‟s land property and give power to the authority to decide the plan for development. Even though the master plan and land ownership strategy has been set up, there are still dilemmas facing in underground land development. According to the laws of Finland, the surface land owner has the power to control over the underground land because the vertical extent of ownership is not specifically defined in the legislation. When interpreting the extent of ownership, the lower boundary of a property has been limited to the depth of 6 meters. Same like the other country, the underground land in Finland can be developed by any responsible party, but must get the written permission from

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the surface landowner. Along with that, the land...