QuestionsQuestions (EXECUTIVE ORDER NO. 229)
CARP covers, regardless of tenurial arrangement and commodity produced, all public and private agricultural lands under Proclamation No. 131 (July 22, 1987), including other lands of the public domain suitable to agriculture, when applicable in accordance with law.
It is implemented as provided in the Order for all covered lands, subject to priorities and reasonable retention limits Congress may prescribe, taking into account ecological, developmental, or equity considerations, and always subject to payment of just compensation.
Lands actually used and found necessary for national defense, school sites and campuses, religious purposes, penal colonies, and government research and quarantine centers are exempt.
Within 180 days from effectivity, all natural and juridical persons, including government entities, owning, leasing, or managing agricultural lands must file a sworn statement in the proper Assessor’s Office, in a form prescribed by the DAR, to enable identification and valuation for agrarian reform.
At minimum: property description and area; estimated average gross income; names of tenants and regular farmworkers; crops planted and areas as of June 1, 1987; terms of mortgages/leases/management contracts as of June 1, 1987; latest declared market value from the City/Provincial Assessor; and a sworn declaration of the current fair market value the owner wishes to receive if acquired.
Valuation for landowner compensation will be based on the City/Provincial Assessor’s value; and starting the quarter immediately following registration, the real property tax payable will be based on the owner’s declared current fair market value (per Section 4).
DAR identifies land, landowners, and beneficiaries; publishes decision to acquire and notifies landowners with an offer to pay. Within 15 days, landowner signifies acceptance or rejection. If accepted, LBP pays within 15 days after surrender of required documents. If rejected or no reply, DAR conducts administrative summary proceedings for compensation, with parties submitting evidence within 15 days. After decision, LBP establishes a trust fund within 15 days and notifies parties. After trust fund establishment or owner’s acceptance, DAR takes possession and Register of Deeds issues a TCT in the name of the Republic as trustee; DAR then redistributes the land to beneficiaries.
The party may bring the matter to the proper court for determination of just compensation.
Upon establishment of the trust fund or receipt by the DAR of the landowner’s acceptance of the offer, after formal notification by the DAR.
(1) Bond payment over 10 years: 10% cash immediately; balance in LBP bonds bearing market rates aligned with 91-day treasury bills, with annual maturity of one-tenth of face value for 10 years. (2) Direct payment in cash or kind by farmer-beneficiaries with mutually agreed terms subject to DAR approval. (3) Other payment modes as prescribed or approved by PARC.
Investment information and counseling assistance; conversion/exchange of LBP bonds to/from government stocks and/or with government assets; and marketing of LBP bonds.
Landowners may enter into voluntary agreements for direct transfer to beneficiaries under terms acceptable to both parties, subject to DAR approval. It must meet guidelines (beneficiaries same as those eligible for resale purchase; area not less than what government would acquire for resale; terms of standing offers known and understood). The agreement includes sanctions and is binding and irrevocable for both parties, and recorded/monitored by DAR.
Such transactions are exempt from capital gains tax and other taxes and fees.
Corporate landowners may give workers and qualified beneficiaries the right to purchase a proportion of the corporation’s capital stock corresponding to the relation of land assets to total assets, plus additional compensation usable for this purpose. Approval by PARC of the plan and its initial implementation is deemed compliance.
Existing leases/management contracts registered prior to approval may continue under original terms but not beyond 5 years. Renewal requires qualified beneficiaries’ agreement. If lease rentals are not acceptable to qualified beneficiaries, rentals are renegotiated with BARC assistance; if no agreement, DAR determines rental. Mortgages and other registered claims are assumed by the government up to the landowner’s compensation value under Section 6.
Payment is in 30 equal annual payments with 6% per annum interest; first payment due one year after resale; with a 2% interest rebate for timely amortizations, but annual amortizations cannot exceed 10% of the land’s annual gross production value. If amortizations exceed 10%, LBP reduces interest and/or principal to keep repayments affordable. Incentives exist for prepayments. LBP has a mortgage lien on the land; it may foreclose when unpaid past due reaches the equivalent of three (3) annual amortizations.
Entities/entities operating lease agricultural lands with gross sales exceeding P5 million per annum must execute a production sharing salary plan giving farmworkers at least 2.5% of gross sales as compensation over and above their current compensation, subject to the rule that the employer cannot be obligated to pay more than 100% of regular and annual compensation of the farmworkers.
DAR has quasi-judicial powers to determine and adjudicate agrarian reform matters and has exclusive original jurisdiction over agrarian reform implementation issues, except those under exclusive jurisdiction of DENR and DA. DAR can punish contempt and issue subpoenas/writs to enforce orders. DAR decisions may be appealed to Regional Trial Courts in proper cases but are immediately executory notwithstanding the appeal.