Ho Tung Gardens Saga and the Basis of Compensation under the Antiquities and Monuments Ordinance: A Comparative and Incentive Case Study on Regulatory Takings

摘要

Regulatory schemes that mandate historical preservation for private property are increasingly common. This article employs the attempt to preserve Ho Tung Gardens as a case study to examine problems in the design of compensation measures for such schemes. The compensation provision of Antiquities and Monuments Ordinance (Cap 53) is ambiguously worded, and this article argues that this Ordinance provides compensation only for the additional costs associated with the maintenance of historical buildings and does not compensate owners for property value depreciation. However, this article also argues from an incentive perspective that adequate compensation should be provided to property owners for such depreciation to ensure that the government and the public duly account for the true costs of heritage conservation. In addition, adequate compensation eliminates the perverse incentives for owners to preemptively demolish historical buildings in order to avoid the regulatory regime. This article draws on similar legislative experiences in the UK to propose guidelines for reforming the compensation provision.