Chinese national fined for breaking law banning foreigners from speculating in residential properties
He had bankrolled purchases of 3 houses along East Coast Road, with the intention of developing condos on the land and selling units for profit
SINGAPORE — A Chinese national was fined S$45,000 on Thursday (18 April) for breaking a law which prevents foreigners from speculating in residential properties in Singapore.
Zhan Guotuan, 59, had provided the money to buy three landed properties in East Coast Road in 2007, with the intention to demolish them, develop condominiums on the land and sell the units for profit.
None of the three houses - worth more than S$6 million in total - were "non-restricted residential properties", meaning that foreigners were normally not entitled to buy them.
Zhan thus breached a law under the the Residential Property Act (RPA) which was rolled out to prevent actions which could lead to a rise in home prices and adversely affect the interests of Singaporeans.
He had pleaded guilty on Tuesday to an offence under the RPA linked to one of the houses - identified in court documents as Z. Three other charges, including two under the same Act involving the other properties (identified in court documents X and Y), were considered during sentencing.
Prosecution had told the court on Tuesday that the prime mover was Zhan's Singaporean business associate, Tan Hui Meng. Tan, 57, was already sentenced in March to jail for two years, three months and three weeks, as well as a S$3,000 fine.
Houses bought with plans for redevelopment
Zhan was a shareholder of two companies – Alphaland International and Xin An Technology Group – that were in the business of property development in Singapore.
In early 2007, Tan entered into a plan to pursue Zhan’s property development business in East Coast Road on the Chinese national’s behalf. X and Y were then bought with Zhan’s money.
The other house, Z, was bought in the name of Guan Aimei, the wife of one of Alphaland’s employees. Its legal title was transferred to her on 2 July 2007, and she had been fined S$5,000 over her role in the offence.
On 13 July 2007, Tan procured an option to buy Z. He also incorporated a firm called Hwampoa, which had no employees and no business operations and was formed for the sole purpose of purchasing and holding the East Coast Road properties. Zhan later authorised Hwampoa to acquire Z, which was bought for S$2.4 million.
According to Tan, the estimated profit from the land redevelopment in East Coast Road was over S$50 million, and he was to get 20 per cent of the profits from two of Zhan’s companies.
Warrant of arrest before return
After committing the offences, Zhan was charged in a Singapore district court in 2017 before he returned to China. He was overseas when he had a warrant of arrest issued against him in 2022, before finally returning here on 1 March 2024.
Prosecution had asked for Zhan to be given the maximum fine, adding that they would have sought a jail sentence for him if not for several mitigating factors.
Among other things, Z was later sold and Hwampoa voluntarily surrendered S$2.1 million. Zhan had also voluntarily surrendered another S$2.3 million.
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