QuestionsQuestions (Republic Act No. 6389)
It is known as the Code of Agrarian Reforms of the Philippines.
Among others: establish cooperative-cultivatorship/owner-cultivatorship and economic family-size farms; achieve a dignified existence for small farmers; create a viable social and economic agriculture structure through cooperative production/processing/marketing/credit/services; apply labor laws equally to industrial and agricultural wage earners; implement land resettlement and public land distribution; prioritize adequate and timely financing of the Agrarian Reform Program; involve LGUs in implementation; and evolve a system of land use and classification.
They include: (1) agricultural leasehold replacing share tenancy; (2) system of crediting rental as amortization on purchase price; (3) declaration of rights for agricultural labor; (4) machinery for acquisition and equitable distribution of agricultural land; (5) an institution to finance acquisition/distribution; (6) machinery to extend credit/assistance to lessees and amortizing owners/cooperatives; (7) machinery to provide marketing/management/technical assistance; (8) machinery for cooperative development; (9) a department for agrarian reform projects (D.A.R.); (10) expanded program of land capability survey/classification/registration; (11) judicial system for agrarian disputes; and (12) legal assistance machinery.
Share tenancy is declared contrary to public policy and is automatically converted to agricultural leasehold upon the effectivity of the section.
Such assistance may be continued, but total charges including interest and service, inspection and issuance fees must not exceed 14% per calendar year; principal must not be subject to upward adjustment even with extraordinary inflation/devaluation; and for loans/advances other than money, interest is computed based on the current price of goods at the time loans/advances were made.
They automatically must be sold to the tenant on installment for a period not exceeding five years at a price agreed by the parties, with the tenant required to pay in advance 10% of the agreed price.
Existing share tenancy contracts may continue in force and effect in the meantime, governed by RA 1199 (as amended), until the end of the agricultural year when the President organizes the Department of Agrarian Reform by executive order under the amendatory Act—unless contracts provide a shorter period or the tenant earlier exercises the option to elect the leasehold system.
They must notify landowners in writing with assistance of the Bureau of Agrarian Legal Assistance. They have one agricultural year from the date of notice to accept the leasehold relationship; otherwise, the landowner may proceed to ejectment.
If the agricultural lessor decides to sell, the agricultural lessee has the preferential right to buy under reasonable terms/conditions. The entire landholding offered for sale must be pre-empted by the Department of Agrarian Reform upon petition of the lessee or any of them.
Each lessee is entitled to the preferential right only to the extent of the area actually cultivated by him.
They may exercise within 180 days from notice in writing served by the owner on all lessees affected and the Department of Agrarian Reform. Upon filing a corresponding petition/request with the Department or in court by the lessee/lessees, the 180-day period ceases to run.
Any dispute on reasonableness of terms/conditions may be brought to the proper Court of Agrarian Relations, which must decide within 60 days from filing. After finality, the Land Bank must pay the lessor the price fixed by the court within 120 days; if Land Bank fails to pay, principal earns interest equivalent to the prime bank rate.
It applies when the landholding is sold to a third person without the knowledge of the agricultural lessee. The redemption price is the reasonable price of the land at the time of sale. The redemption right must be exercised within 180 days from notice in writing served by the vendee on all lessees affected and the Department upon registration of the sale.
Construction of a permanent irrigation system (including distributory canals) may be borne exclusively by the agricultural lessor, who may be entitled to increased rental proportionate to increased production. If the lessor refuses, the lessees may shoulder the expenses; then lessor cannot increase rental and must pay lessee/heir the reasonable value of improvements upon termination. Government-constructed irrigation systems may be given to lessees for operation/collection subject to rules and allocation limits (e.g., up to 25% for rentals to government if obligations exist until paid). If installed/constructed at the landowner/lessor expense, DAR initiates acquisition at current fair market value so ownership vests in lessees.