The earliest provision regarding land use of FIEs in China existed in the Law of the PRC on Sino-Foreign Equity Joint Ventures promulgated on July 8, 1979. Article 5 of this Law stipulates, “[t]he investment contributed by a Chinese investor may include the right to use a site provided for the joint venture during its operating term. Where the site use right does not constitute part of the investment made by the Chinese investor, the joint venture shall pay use fee to the Chinese government.” The so-called “use fee” means the fee which shall be paid by FIEs for occupying the land, i.e. site use fee. It reflects the fundamental policy that payment shall be made for land use.
Later, the State Council promulgated the Interim Regulations of the State Council on Construction Land for Sino-Foreign Joint Ventures (Guo Fa  No.201) on July 26, 1980. This Interim Regulations stipulates that, where Sino-Foreign joint ventures use land, whether for new plots acquired through requisition or original sites of enterprises, the site use fees shall be calculated and paid. With respect to plots to be utilized by enterprises, any joint ventures shall file an application with construction land administration department at county or municipal level which is designated by local people’s government of a province, municipality or autonomous region where the joint ventures domicile. The construction land administration department shall verify and approve allocation in accordance with relevant documents approved by governmental department in charge of enterprise administration and under procedures prescribed by the state. Further, the joint ventures and construction land administration department shall enter into a land use contract which explicitly prescribes relevant matters such as amount of plots, concrete site, time of land supply, term of land use and standard of land use fee, meanwhile the contract shall explicitly set forth economic liabilities of bilateral parties.
On September 20, 1983, the State Council promulgated the Implementing Regulations of the Law of the PRC on Sino-Foreign Equity Joint Ventures, Article 47 of which stipulated, “Joint ventures shall implement the principle of economizing on land in their use of sites. Any joint venture expecting for use of a site shall file an application with local land administration department at municipal (county) level and obtain the site use right after being approved and entering into a contract. The site area, location, purpose, term of joint venture, fee for site use right, rights and obligations of bilateral parties and penalty for breach of contract shall be stipulated explicitly in the contract.”
According to the above provisions, there did not exist the concept of land grant at the early stage of reform and opening-up. The mode of land use was that FIEs filed applications and land administration departments verified and approved allocation. The so-called verification and allocation means allocation in the context of that era. Meanwhile we have noticed that for FIEs the land use shall be paid for, whether in the form of site use fee or payment methods that appear later such as land rent or land grant fees. The occupation of land without any consideration is not allowed (except for application for reduction and exemption). Furthermore, the above provisions also stipulate that FIEs own the site use right during their business, and thus the terms of allocated land use rights shall be consistent with those of enterprises’ business operation.