Informal land registration under unclear property rights: witnessing contracts, redevelopment, and conferring property rights

Abstract

The significance of informal land registration in property transactions and development has been discussed at length, but there are few examples of in-depth case studies of how this information accessing and collection institution relates to them and how it may create property rights. This paper examines the nature and operation of non-governmental and voluntary land transaction registration practices in Kowloon Walled City, an ideal example of a privately-planned and developed habitat under unclear property rights due to jurisdictional disputes between China and Britain and no state protection of property rights or intervention in building control existed. Based on documentary evidence interpreted from a Coasian and Hayekian stance, it advances the proposition that the contracts the Kowloon Walled City Kaifong Welfare Promotion Association (hereafter the Kaifong Association) sought to represent as a witness built up its political credibility as a representative body. Such a role not only reduced transaction costs of contract enforcement and, hence, facilitated redevelopment, but also became that of a quasi-government land registrar due to the popularity of its witnessing service, which, under specific circumstances, served as the basis for the assignment of de jure private property rights by the state.