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2. Convert presidential consent into an automatic right of the
leaseholder to transfer, subject to clear, written, verifiable, and
impersonal criteria.
The act of recording a transfer would constitute documentation of presidential consent. Refusal
of the registrar to record a transfer within 90 days of the time presented could be appealed to the land
tribunal, which would determine definitively whether the transfer was in order or not and instruct the
registrar to proceed accordingly.
3. Create procedures for the renewal of leases upon demand, subject to
agreed investments.
Present law states that 14-year leaseholds can be converted into 99-year leases upon demand,
by proving that improvements have been built. However, there is as yet no provision for renewal of
the 99-year leases. Draft laws state that these leases "may" be renewed, but do not say that they "will"
be renewed upon request, nor do the laws state if any conditions are to be imposed on the renewal.
For an efficient land market, the rules for renewal should be clear. It would be logical to
provide for renegotiation of the amount of the annual ground rent, for instance. The point is simply
that since improvements pass to the government upon expiration of the lease, an investor should have
the right to renew a 99-year lease earlier than 99 years if he/she is planning to make a further
investment in improvements. Such renewals are routine in Baltimore, Maryland, for example, a US
city in which much of the central business district land is leased on a ground rent basis. Owners of
the buildings on those sites routinely come to the banks or insurance companies that own the land
about 30 or 40 years before leases expire, to negotiate a new 99-year lease. In this way, the person
or company that intends to make a major investment in expanding or modernizing knows that it will
remain the owner of the building long enough to fully amortize the investment. This recommendation
does not necessarily mean a change in the present law; it merely clarifies that a 99-year lease can be
renewed for a further 99 years from any time, upon application by the lessee. The present law appears
to be silent on the matter, although it does explicitly allow for the conversion of a 14-year lease to
a 99-year lease at any time.
4. Update valuations, and index for the future.
As noted above, existing valuations of land and improvements in Zambia are far below market
values. Not only should they be updated, it would be prudent to provide for automatic maintenance
of that value in real terms in the future. Some governments set values in terms of "fiscal units of
value" and then provide by law that the monetary value of the fiscal units will change automatically
according to some index of prices that serves as a reference point. This policy does not take notice
of changes in market values arising from population growth, economic development, or public
investments that enhance the value of specific parcels of land. For that purpose, one still needs a
periodic reevaluation of all property. However, Zambia has a legal requirement that this be done every
five years for urban rates; that standard should probably simply be extended to annual ground rents
as well. Between revaluations, however, rates are currently adjusted by increasing the rate of tax on
valuations which quickly become obsolete. There is no similar automatic adjustment of annual ground
rents, and there should be. But rather than increase the nominal rate of ground rent on a static market
value, it might be easier for the law to specify that the amount of ground rent would be increased or