Annual Report 2020

NOTESTOTHE CONSOLIDATED FINANCIAL STATEMENTS For the year ended 31 December 2020 102 The United Laboratories International Holdings Limited Annual Report 2020 19. INVESTMENT PROPERTIES AND PROPERTIES HELD FOR DEVELOPMENT a) Properties held for development During the year ended 31 December 2014, the Group made a full land premium payment of RMB484,050,000 to respective authority and obtained all land use right certificates, of a land located in Chengdu, Pengzhou (“Chengdu Lands”). The land use right certificate indicated that the period for which Chengdu lands could be used for commercial and residential purposes would expire on 27 December 2053 and 2083, respectively. Pursuant to the Group’s development plan of the Chengdu Lands at 31 December 2014, certain lands will be developed into residential properties for sale. Accordingly, the amount of approximately RMB255,723,000 based on the proportion of lands to be developed as properties for sale had been reclassified from “Investment properties” to “Properties held for development” representing the deemed costs equivalent to the fair value measured at 31 December 2014 immediately prior to its reclassification. During the year ended 31 December 2019, the entire properties held for development of RMB255,723,000 has been disposed of as a result of disposal of a subsidiary as set out in Note 10. b) Investment properties In 2014, the Group applied to local authority in Pengzhou for extension of the commencement date of property development which was approved by respective government authority in February 2015, with an extended period to no later than 31 December 2019 (the “Extension Document”). Pursuant to Article 26 of Chapter II of the Urban Real Estate Administration Law of the PRC and the Extension Document, when the development has not started in one year from the date required to start the development as prescribed by the Extension Document, an idle land fee not more than 20 percent of the lease fees for land use (“Idle Land Fee”) may be imposed, i.e. if the real estate development work was not commenced on or before 31 December 2018. Furthermore, the land will be taken back by the government without compensation if the real estate development work is not commenced on or before 31 December 2019.