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LCQ9: Assisting various industries in operating in industrial buildings
     Following is a question by the Hon Ma Fung-kwok and a written reply by the Secretary for Development, Mr Eric Ma, in the Legislative Council today (April 26):
     Under the existing requirements, an owner of an industrial building unit intending to use his unit for uses other than those permitted under the relevant lease must first apply to the Lands Department for temporary waiver (waiver) for permission of the proposed uses. If the application is approved, the owner concerned is generally required to pay a waiver fee and an administrative fee. On the other hand, the Government announced in June 2012 and February last year respectively the exemption of the payment of waiver fees involving the conversion of industrial building units for use as data centres as well as testing and calibration laboratories (testing laboratories), in order to promote the development of such industries. On assisting various industries in operating in industrial buildings, will the Government inform this Council:
(1) since the payment of waiver fees involving the uses of data centres and testing laboratories has been exempted by the authorities, of the respective numbers of waiver applications received and approved by the authorities involving the conversion of industrial building units for those two types of uses, and the total amount of waiver fees exempted;
(2) of the factors taken into account by the authorities in determining the exemption or otherwise of the payment of waiver fees involving a particular proposed use; apart from the uses mentioned in (1), whether the authorities, at present, have plans to exempt the payment of waiver fees involving other uses;
(3) of the respective numbers of waiver applications received, approved and rejected by the authorities in the past five years for the proposed uses for cultural, arts or sports purposes, and the reasons for rejecting some of such applications; whether the authorities will consider exempting the payment of waiver fees involving such uses so as to promote the development of the relevant industries; if so, of the details; if not, the reasons for that; and
(4) given that the authorities have adopted in recent years a streamlined procedure for handling waiver applications, including the introduction of a standard rate to expedite the vetting and approval process, of the average time currently needed for handling each application; whether the authorities have plans to further streamline that procedure to facilitate and encourage the making of such applications by owners of industrial building units? 
     The reply to the four-part question is as follows:
(1) As at end-March 2017, the Lands Department (LandsD) received a total of 30 waiver applications for proposed use as data centres under the policy initiative for facilitating the development of data centres. Among these applications, three of them had been withdrawn from the LandsD by the owners, 18 were approved and the remaining nine were under processing. Under the policy initiative for assisting the operation of testing and calibration laboratories (testing laboratories) in industrial buildings, the LandsD received a total of seven waiver applications for proposed use as testing laboratories, six of which were approved and the remaining one was under processing.
     In general, the amount of waiver fee payable for the approved applications will depend on the floor area, location, and the proposed use of the premises in question. However, as the waiver fees for the above uses were already exempted by the Government in accordance with the said initiatives, the Government had not assessed the waiver fees for the above applications.
(2) On the basis of relevant policy objectives, the Government may consider introducing a fee exemption/fee concessionary scheme for individual industries or specified uses to facilitate the conversion of an industrial lot or an existing industrial building to specified uses. In respect of the setting up of data centres and testing laboratories in industrial buildings at present and wholesale conversion to accommodate non-industrial purposes under the Scheme on Revitalisation of Industrial Buildings implemented earlier, for cases meeting the policy requirements, the Government may grant a waiver and exempt the payment of a waiver fee. Other than these, there are no other circumstances in industrial buildings which can be given exemption of waiver fees.
(3) The LandsD does not compile statistics on a regular basis for cases of application for temporary waiver in industrial buildings. Apart from the special measures as mentioned in Part (1) above, in general, the waiver applications received by LandsD mostly involve a basket of uses, among which uses related to arts, culture, etc. may be involved. Upon approval of the relevant temporary waiver applications, the ultimate use would depend on the decision of the applicant. 

     Due to the limited time available, the Department could only conduct a simple survey for the question. The findings show that it has not received any waiver applications to use premises in industrial buildings solely for cultural, arts or sports uses in the past three years (i.e. from April 2014 up till now).
     The Home Affairs Bureau indicates that it understands the demand for arts space by local artists and has examined with the relevant departments on how to further assist the sector in the use of industrial buildings and other space for arts creation work and related activities, including the feasibility of allowing artists to carry out arts creation work in industrial buildings. After discussions, the relevant departments have agreed to include "Art Studio" (excluding those involving direct provision of services or goods) as an always permitted use in industrial-office buildings in "Industrial", "Other Specified Uses" annotated "Business" and "Residential (Group E)" zones. As at mid-April 2017, the Town Planning Board has amended a total of 14 Outline Zoning Plans (OZPs) according to the above recommendation. Similar amendments to other OZPs will be made in future when suitable opportunities arise in future.

     Regarding land leases, land leases of industrial buildings generally contain user restrictions. The main purpose of waiver fees exemption is to relax these land lease restrictions originally allowing only certain prescribed uses, thereby allowing non-industrial uses originally not allowed in industrial buildings to make the best use of these buildings under the exemption arrangement. As regards the measures of waiver fees exemption for data centres and testing laboratories, the prerequisite is that the premises concerned must fulfil the government requirements in planning, fire safety and building safety, which are not relaxed as a result of the exemption measures. Unlike the uses as data centres and testing laboratories, conducting cultural, arts or sports activities in industrial buildings generally involves the general public and a higher visitor flow. The Government must exercise caution when evaluating the safety hazard involved.
     On the premises of a due regard to public safety, the Government will continue to examine how to further optimise the use of existing industrial buildings for various activities and to provide more spaces for arts, cultural and sports activity purposes.
(4) Notwithstanding the introduction of fees at standard rates to expedite the vetting and approval process of waiver applications, it is still necessary for the LandsD to consult the relevant departments on these applications. The time needed for handling each application varies depending on the nature and complexity of each case and cannot be generalised. We have no plan to further streamline the procedures for the time being.
Ends/Wednesday, April 26, 2017
Issued at HKT 15:01
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