The SDG Temple of Justice 

The Second Pillar: Property Rights

The eight pillars of legal empowerment

of the SDG Temple of Justice

The blueprint presented here seeks to help realize the Sustainable Development Goals (SDGs) by leveraging the human rights foundation of SDGs through the eight pillars of rights relating to legal empowerment of the people including the poor and vulnerable groups.

Why property rights matter for the SDGs?

Ensuring property rights is a critically important means of ending poverty (SDG 1) and achieving gender equality and empowering all women and girls (SDG 5):

 

Goal 1. End poverty in all its forms everywhere

1.4       By 2030, ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership and control over land and other forms of property, inheritance, natural resources, appropriate new technology and financial services, including microfinance.

Goal 5. Achieve gender equality and empower all women and girls

5.a       Undertake reforms to give women equal rights to economic resources, as well as access to ownership and control over land and other forms of property, financial services, inheritance and natural resources, in accordance with national laws.

Property rights help people to keep what they make. Property can be broadly classified into real property (land and buildings), intellectual property (patents, trademarks and copyright), and organizational property (corporations and partnerships).

 

The property law and contract law together provide the legal foundation for markets. Robert D. Cooter and Hans-Bernd Schaefer (2011) have formulated the property principle for innovation, and the contract principle for economic cooperation.

 

Under the property principle for innovation, people who create wealth can keep most of it. Successful implementation of the property principle gives people motivation to make wealth, not to take it. Besides motivation, making wealth requires coordinating the efforts of different people. Under the contract principle for economic cooperation, the law should enable people to commit to doing what they say. When this principle is implemented, people can trust each other enough to work together, even when money is at stake.

 

Taken together, the property principle and the contract principle provide motivation and coordination for economic activities. Innovation is the central economic activity for sustained growth.

Recognition of Property Rights in International Conventions

Article 17 of the Universal Declaration of Human Rights (UDHR) enshrines the right to property as follows:

"(1) Everyone has the right to own property alone as well as in association with others.

(2) No one shall be arbitrarily deprived of his property."

 

Article 5 of the International Convention on the Elimination of All Forms of Racial Discrimination provides that everyone has the right to equality before the law without distinction as to race, colour and national or ethnic origin, including the "right to own property alone as well as in association with others" and "the right to inherit".

 

The Convention on the Elimination of All Forms of Discrimination against Women recognizes the property rights in Article 16, which establishes the same right for both spouses to ownership, acquisition, management, administration, enjoyment and disposition of property, and Article 15, which establishes women’s' right to conclude contracts.

 

Property rights are also enshrined in the Convention relating to the Status of Refugees and the Convention on the Protection of the Rights of All Migrant Workers and Members of Their Families

 

An Agenda for Property Rights

The agenda for Property Rights proposed by the UN High Level Commission on Legal Empowerment of the Poor (UN HLCLEP, 2005-2008) is worth reproducing here:

Promote an inclusive property rights system

An inclusive pro-poor property-rights system requires rules that clearly define the bundle of rights and obligations between people and assets. Property law should offer clear and simple options of legal personality and corporate ownership for small businesses and customary associations of the poor. Legal protection of limited liability has to be extended to poor micro-entrepreneurs, and adverse possession rights formally recognized for their real as well as intangible assets. Legal frameworks enabling housing and land associations should be promoted, allowing individual and common property to be combined by people with limited assets. Officially recognized property documentation should take the form of simple certificates that grant formal recognition to social practices and customary tenure.

 

Institutionalize an effective property rights governance system

The functioning of the property administration agency and land administration bodies is critical for the poor.

 

Develop property and credit markets accessible to the poor

A comprehensive and functional property and business system allows land, houses, moveable property, equity shares, and ideas to be transformed into assets that can be leveraged and bought and sold, at rates determined by market forces, in a transparent and accountable way. It should permit the development of financial mechanisms – including credit and insurance – to facilitate transactions and improve economic outcomes.

 

Recognize movable property as collateral

There is growing evidence that expanding the number of items that can be used legally as collateral reduces the cost of credit. More people can borrow if more types of property can be used as collateral and credit markets become more competitive. More of the poor would be able to create credit histories without risking land and entire homes. The credit system does not evolve automatically from the formalization of assets. Catalytic and concerted action by the state and private financial institutions is needed in order to foster access to credit for poor families and small urban and rural producers. A complementary means of supporting pro-poor credit markets is through the creation of movable property registries.

 

Reinforce property rights through social and other public policies

The state can do a lot to endow its citizens with property assets – for instance, by providing access to housing ownership for the poor, offering low-interest loans, and distributing state land. Redistributive land reform needs to be complemented by access to basic services, managerial ability, technology, credit, and markets for the new owners. As an alternative to authoritative reallocation of land, community-based land reform projects provide funds to groups of beneficiaries to purchase land.

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