A Chinese company recently started evicting settlers at the “First Block” at ATS Settlement. This follows those evicted from 9 Mile Settlement. Clifford Zaneng explains the difference between State Lease, Certificate of Titles, and Customary Land. Basically, state land lease lasts for 99 years, certificate of titles leases lasts 25 years but is still a customary land, and customary land cannot be leased.
By Clifford Zaneng
STATE LEASE vs. CERTIFICATE OF TITLE
I am compelled to write this piece as I am increasingly finding to many of my friends and others making the mistake of entering into Land purchase transactions without appreciating the difference between a STATE LEASE and a CERTIFICATE OF TITLE.
Whilst others may say this is not the correct forum for this discussion, I will say it is, for the fact that the other places that such advice is available you will not have access to them without an entry fee. 😉
A STATE LEASE is the most secured Land acquisition mode in our country. Recent evictions at ATS and the BUSH WARA 9 Mile on behalf of the State Lease holders confirm this.
The main similarities with a STATE LEASE and a CERTIFICATE OF TITLE are:
1.1 REGISTERED SURVEY
The STATE LEASE and a CERTIFICATE OF TITLE will both have a REGISTERED SURVEY, which has been registered with the Surveyor General’s Office at the Lands Department and it would have been issued a CAT No.
If you are shown a Registered Survey go a step further and request to see a copy of the title.
Whilst both the STATE LEASE and a CERTIFICATE OF TITLE are registered with the Register of Titles at the Lands Department, the process of registration is different.
For now I’ll say the STATE LEASE is less controversial, however, the CERTIFICATE OF TITLE is issued after the Land Titles Commission (LTC) hearing is done and LTC has made a determination after receiving evidence and arguments from contending Landowner Groups.
The process also involves the Incorporated Land Groups (ILG) made up of the clans and not individuals, so if you are receiving the CERTIFICATE OF TITLE from an individual, request for the ILG Certification, his relation to the ILG and the LTC determination that led to his CERTIFICATE OF TITLE being registered.
DO YOUR DUE DILIGENCE. This is a MUST that is strongly recommended.
The following are some of the main differences between an STATE LEASE and CERTIFICATE OF TITLE.
2.1 TERM OF THE LEASE
With a STATE LEASE you can lease the land for 99 years before applying for a State Lease renewal with the State, who owns the Land.
In a CERTIFICATE OF TITLE the lease is for 25 years (under the current arrangements) and the land reverts back to the ILG after the 25 years. It reverts to the ILG as Customary owner of the Land.
2.2 MORTGAGES & LOANS
Commercial Banks and Financial Institutions will not give you a Mortgage or any other Loan against a CERTIFICATE OF TITLE.
Zero Kina from the Commercial Banks and Financial Institutions.
This is because the ownership of land under the CERTIFICATE OF TITLE is customary and customary ownership is not transferable.
Meaning the banks can’t recover the land in the case of a default and sell or transfer the Land because they can’t do that under the existing Land laws of PNG.
2.3 CUSTOMARY LAND
Remember the CERTIFICATE OF TITLE is CUSTOMARY LAND.
The difference it has to other Customary Land is that it’s registered and the others aren’t.
Even if it’s registered REMEMBER the law is that, CUSTOMARY LAND cannot be SOLD.
Thank you. Em tasol.
This should be enough for you to think about.
DISCLAIMER: Seek competent legal advise and do your due diligence when purchasing land. This advise is for your guidance and food for thought and should not be used as the basis of your decision making.