New rules concerning house expropriation and demolition have tested the Chinese government's ability to balance the interests of property developers and ordinary people, experts say.

The State Council, China's cabinet, published a regulation on expropriation and compensation of houses on state-owned lands earlier this month, putting an end to forced demolitions in cities without due process and fair compensation -- which had become a major source of social conflict.

Wang Liming, professor of Renmin University of China, said, "Even as house expropriation and demolition are essential to meet the public interest, we must improve the protection on property owners' interests, by standardizing demolition and relocation procedures."

The new regulation sets down rules for compensation first and relocation later, forbidding the use of violence or coercion to evict homeowners.

The regulation also rules out land developers' involvement in demolition and relocation procedures.

"The protection of property owners' interests are enhanced, as the new regulation clearly outlaws forced demolition. It will help defuse long-standing social strains and help maintain social stability," Wang said.

Xue Gangling, president of China University of Political Science and Law, said, "The administrative authorities hope to safeguard public interests and minimize the risk of instability through the legal and judicial systems."

Shen Kui, a law professor at Peking University, said if the new regulation is enforced strictly, the frequency of forced demolitions will fall.

First reviewed at an executive meeting of the State Council in December 2007, the draft regulation was discussed at 45 seminars by about 1,150 people.

To better absorb public opinion, the draft was made public twice, in Dec. 2010 and Jan. 2011.

The cabinet's Legislative Affairs Office received more than 100,000 public submissions during the process, with forced demolition and fair compensation the major public concerns. Revisions were made to the draft regulation accordingly.

One principle of the new regulation is that expropriation of homes should improve, not impair, the living standards of the home owners, according to the Legislative Affairs Office.

The new regulation ensures that compensation for expropriated homes is no lower than the market price of similar properties.

The new regulation ensures the use of market prices to determine compensation, and is also in line with the provisions of the Property Law that took effect in 2007, said Wang Liming, professor of Renmin University of China.