Policy and guiding principles
- The State pursues a Comprehensive Agrarian Reform Program (CARP) with the welfare of landless farmers and farmworkers receiving the highest consideration to promote social justice, move the nation toward sound rural development and industrialization, and establish owner cultivatorship of economic-size farms as the basis of Philippine agriculture (Section 1 amending Section 2 of Republic Act No. 6657).
- The State promotes industrialization and full employment based on sound agricultural development and agrarian reform, through industries that make full and efficient use of human and natural resources and are competitive in domestic and foreign markets (Section 1).
- Conversion of agricultural lands into industrial, commercial or residential lands must take into account farmers’ rights and national food security; the State must protect Filipino enterprises against unfair foreign competition and trade practices (Section 1).
- The agrarian reform program is founded on the right of farmers and regular farmworkers who are landless to own directly or collectively the lands they till, and in the case of other farmworkers to receive a just share of the fruits (Section 1).
- The State undertakes a more equitable distribution and ownership of land with due regard to:
- the rights of landowners to just compensation,
- retention rights under Section 6 of Republic Act No. 6657 as amended, and
- the ecological needs of the nation (Section 1).
- The implementation is to be as community-based as practicable to give farmers greater control of farmgate prices and easier access to credit (Section 1).
- The State recognizes and enforces the rights of rural women to own and control land and to be represented in advisory or decision-making bodies, independent of male relatives and civil status (Section 1).
- The State recognizes subsistence fishermen and protects their preferential use of communal marine and fishing resources inland and offshore; it also extends protection to offshore fishing grounds against foreign intrusion and provides support through appropriate technology and services (Section 1).
- Land has a social function and land ownership has a social responsibility; owners of agricultural land have the obligation to cultivate directly or through labor administration the lands they own to make the land productive (Section 1).
- The State may lease undeveloped lands of the public domain to qualified entities for capital-intensive farms and traditional and pioneering crops especially for exports, subject to prior rights of beneficiaries under CARP (Section 1).
Statutory definitions
- The statute defines “Farmer” as a natural person whose primary livelihood is cultivation of land or production of agricultural crops, livestock and/or fisheries by himself/herself or primarily with assistance of the immediate farm household, whether the land is owned or held under leasehold/share tenancy (Section 2 amending Section 3 of Republic Act No. 6657).
- The statute defines “Rural women” as women engaged directly or indirectly in farming and/or fishing for livelihood (paid/unpaid; regular/seasonal), including food preparation, managing the household, caring for children, and similar activities (Section 2 amending Section 3 of Republic Act No. 6657).
Scope, inventory, and key exclusions
- CARP covers all public and private agricultural lands, regardless of tenurial arrangement and commodity produced, as provided in Proclamation No. 131 and Executive Order No. 229, including other lands of the public domain suitable for agriculture (Section 3 amending Section 4 of Republic Act No. 6657).
- Landholdings with a total area of five (5) hectares and below are not covered for acquisition and distribution to qualified beneficiaries (Section 3).
- CARP covers, specifically:
- (a) all alienable and disposable lands of the public domain devoted to or suitable for agriculture, and it bars reclassification of forest or mineral lands to agricultural lands after approval of this Act until Congress determines by law the specific limits of the public domain (considering ecological, developmental and equity considerations) (Section 3);
- (b) all lands of the public domain in excess of specific limits determined by Congress (Section 3);
- (c) all other lands owned by the Government devoted to or suitable for agriculture (Section 3); and
- (d) all private lands devoted to or suitable for agriculture regardless of products raised or raised potential (Section 3).
- DAR must institute a comprehensive inventory system in consonance with the national land use plan for identifying and classifying farmlands within one (1) year from effectivity of this Act, consistent with the Local Government Code (Section 3).
Exceptions, land-size review, and acquisition phases
Local government units that acquire private agricultural lands by expropriation or other modes of acquisition for actual, direct and exclusive public purposes—such as roads and bridges, public markets, school sites, resettlement sites, local government facilities, public parks and barangay plazas or squares, consistent with the approved local comprehensive land use plan—are exempt from the five (5)-hectare retention limit under Section 6 and Sections 70 and 73(a) of Republic Act No. 6657, as amended (Section 4 inserting Section 6-A).
Lands subject to the exemption under Section 6-A must first undergo the land acquisition and distribution process of CARP, and when expropriation occurs, agrarian reform beneficiaries must be paid just compensation (Section 4).
Within six (6) months from effectivity, DAR must submit to Congress a comprehensive study on land size appropriate for each type of crop for possible review of limits (Section 4 inserting Section 6-B).
DAR, in coordination with PARC, plans and programs final acquisition and distribution of remaining unacquired and undistributed agricultural lands from effectivity until June 30, 2014, applying these acquisition/distribution phases (Section 5 amending Section 7):
- Phase One (first five-year extension):
- all remaining private agricultural lands above fifty (50) hectares are covered for agrarian reform upon effectivity;
- private agricultural lands with aggregate landholdings above fifty (50) hectares already subjected to a notice of coverage issued on or before December 10, 2008—including rice and corn lands under Presidential Decree No. 27;
- all idle or abandoned lands;
- all private lands voluntarily offered by owners for agrarian reform, with voluntary land transfer limited to those submitted by June 30, 2009; after June 30, 2009, modes of acquisition are limited to voluntary offer to sell and compulsory acquisition (Section 5).
- lands with valuation challenges must be completed and finally resolved pursuant to Section 17 of Republic Act No. 6657 as amended (Section 5).
- qualified beneficiaries are limited to farmers (tenants or lessees) and regular farmworkers actually tilling the lands, certified under oath by BARC and attested under oath by the landowners; the intended beneficiary must state under oath before the judge of the city or municipal court willingness to work, make the land productive, and assume obligation of paying amortization and land taxes; plus specific categories including: all lands foreclosed by government financial institutions; all lands acquired by PCGG; and all other lands owned by government devoted to or suitable for agriculture, acquired and distributed immediately with implementation to be completed by June 30, 2012 (Section 5).
- Phase Two:
- Phase Two(a): lands twenty-four (24) hectares up to fifty (50) hectares are covered upon effectivity; it includes:
- all alienable and disposable public agricultural lands;
- all arable public agricultural lands under agro-forest, pasture and agricultural leases already cultivated and planted to crops in accordance with Section 6, Article XIII of the Constitution;
- public agricultural lands to be opened for new development and resettlement; and
- private agricultural lands of landowners with aggregate landholdings above twenty-four (24) hectares up to fifty (50) hectares already subjected to notice of coverage issued on or before December 10, 2008, with principal emphasis on landless farmers and regular farmworkers’ rights to own directly or collectively—distributed immediately upon effectivity, with implementation to be completed by June 30, 2012 (Section 5).
- Phase Two(b): all remaining private agricultural lands of landowners with aggregate landholdings in excess of twenty-four (24) hectares regardless of notice status, with implementation to begin July 1, 2012 and to be completed by June 30, 2013 (Section 5).
- Phase Two(a): lands twenty-four (24) hectares up to fifty (50) hectares are covered upon effectivity; it includes:
- Phase Three:
- lands above ten (10) hectares proceed by schedule:
- above ten (10) up to twenty-four (24) hectares: excess hectares above ten (10) hectares begin July 1, 2012, completed June 30, 2013;
- retention limit up to ten (10) hectares: begin July 1, 2013, completed June 30, 2014 (Section 5).
- lands above ten (10) hectares proceed by schedule:
- Phase One (first five-year extension):
Land acquisition and distribution must be completed by June 30, 2014 on a province-by-province basis (Section 5).
PARC (or PARC EXCOM upon recommendation by PARCCOM) may declare priority land reform areas where acquisition and distribution under advanced phases may be implemented ahead of schedules, conditioned on completion of prior phases in the province (Section 5).
Phase Three(b) is not implemented in a particular province until at least ninety percent (90%) of the provincial balance as of January 1, 2009 under Phase One, Phase Two (a), Phase Two (b), and Phase Three (a)—excluding lands under DENR—has been successfully completed (Section 5).
The PARC must establish guidelines to implement the priority and distribution scheme, including determination of qualified beneficiaries (Section 5).
An owner-tiller may be a beneficiary of land he/she does not own but is actually cultivating, limited to the difference between owned area and the award ceiling of three (3) hectares (Section 5).
Collective ownership by farmer beneficiaries is subject to Section 25 of Republic Act No. 6657, as amended (Section 5).
Rural women must be given opportunity to participate in development planning and implementation (Section 5).
No agrarian reform beneficiaries’ sex, economic, religious, social, cultural or political attributes may adversely affect land distribution (Section 5).
PARC must design and conduct seminars, symposia, information campaigns, and similar programs for farmers who are not organized or not covered by any landholdings, and completion is encouraged (Section 5).
Just compensation and award mechanics
- In determining just compensation, the formula must consider:
- the cost of acquisition of the land,
- value of standing crop,
- current value of like properties,
- nature, actual use and income,
- sworn valuation by the owner,
- tax declarations,
- assessment made by government assessors, and
- seventy percent (70%) of the zonal valuation of the Bureau of Internal Revenue (BIR) translated into a basic formula by DAR,
- subject to the final decision of the proper court (Section 7 amending Section 17 of Republic Act No. 6657).
- Social and economic benefits contributed by farmers and farmworkers and by government must be considered as additional factors, as well as nonpayment of taxes or loans secured from any government financing institution on the land (Section 7).
- For award completion and rights:
- rights and responsibilities commence from receipt of a duly registered emancipation patent or certificate of land ownership award and actual physical possession (Section 9 amending Section 24).
- award completion must occur in not more than one hundred eighty (180) days from registration of title in the name of the Republic of the Philippines (Section 9).
- emancipation patents, certificates of land ownership award, and other titles issued under any agrarian reform program become indefeasible and imprescriptible after one (1) year from registration with the Office of the Registry of Deeds, subject to conditions, limitations and qualifications of Republic Act No. 6657, the property registration decree, and other pertinent laws (Section 9).
- the Registry of Deeds must register title in the name of the Republic of the Philippines after LBP certifies necessary deposit (full payment in cash or in bond with due notice) and registration of certificate issued to beneficiaries, and must cancel previous titles (Section 9).
- qualified beneficiaries have usufructuary rights as soon as DAR takes possession; these rights are not diminished even pending awarding of emancipation patent/certificate (Section 9).
- cases involving cancellation of registered emancipation patents/certificates and other titles are within the exclusive and original jurisdiction of the Secretary of the DAR (Section 9).
- Order of priority for distribution applies within each landholding:
- a landholding must be distributed first to qualified beneficiaries under Section 22(a) and (b) up to a maximum of three (3) hectares each; only after these beneficiaries receive three (3) hectares each may remaining portions be distributed to other beneficiaries under Section 22(c), (d), (e), (f), and (g) (Section 8 inserting Section 22-A).
Award ceilings, beneficiaries, and ownership forms
- Beneficiaries must be awarded an area not exceeding three (3) hectares, which may be a contiguous tract or several parcels cumulated up to award limits (Section 10 amending Section 25).
- Land size determination must consider crop type, soil type, weather patterns, and other variables critical for success (Section 10).
- A landless beneficiary is one who owns less than three (3) hectares of agricultural land (Section 10).
- DAR shall encourage agrarian reform beneficiaries to form or join farmers’ cooperatives and other collective organizations including irrigators’ associations, for affiliation with cooperative banks and for collective representation, with assurance of:
- corresponding shares in the corporation,
- seats in the board of directors,
- and an equitable share in profit (Section 10).
- The land awarded to a farmer-beneficiary should generally be in the form of an individual title covering one contiguous tract or several parcels cumulated up to a maximum of three (3) hectares (Section 10).
- Beneficiaries may opt for collective ownership with collective ownership titles, subject to:
- total area not exceeding total co-owners/members multiplied by award limit, except in meritorious cases determined by PARC (Section 10).
- Collective titles are issued only if conditions exist, including:
- current farm management system not appropriate for individual farming of farm parcels,
- specialized labor system organized by functions not by parcels,
- potential beneficiaries not farming individual parcels but collectively working large contiguous areas, and
- the farm involves multiple crops integrated or includes necessary non-crop production areas that cannot be subdivided (Section 10).
- For idle/abandoned/underdeveloped agricultural lands, collective ownership is allowed only if beneficiaries opt for it and there is a clear development plan requiring collective farming or integrated operations showing the collective ownership conditions (Section 10).
- For collective ownership titles, title is issued in the name of co-owners or the cooperative/collective organization; if certificates of land ownership awards are given to cooperatives, beneficiary names must also be listed in the same certificate (Section 10).
- DAR must immediately undertake parcelization of existing collective certificates that do not meet collective conditions, review and redocumentation, prepare a prioritized list, commence parcelization upon approval, and complete it within three (3) years; only existing certificates collectively farmed or operated in an integrated manner remain collective (Section 10).
Payment terms, liens, foreclosure consequences
- Lands awarded under CARP must be paid by beneficiaries to LBP in thirty (30) annual amortizations at six percent (6%) interest per annum (Section 11 amending Section 26).
- Annual amortization starts:
- one (1) year from certificate of land ownership award registration, but
- one (1) year from actual occupancy if occupancy took place after registration (Section 11).
- Payments for first three (3) years are reduced amounts established by PARC (Section 11).
- The first five (5) annual payments may not exceed five percent (5%) of annual gross production as established by DAR (Section 11).
- If scheduled annual payments after the fifth (5th) year exceed ten percent (10%) of annual gross production and failure to produce is not due to the beneficiary’s fault, LBP must reduce interest rate and/or reduce principal to make repayment affordable (Section 11).
- LBP has a lien by way of mortgage on awarded land and may foreclose for non-payment of an aggregate of three (3) annual amortizations; LBP must advise DAR, and DAR must award forfeited landholding to other qualified beneficiaries (Section 11).
- A beneficiary whose land is foreclosed is permanently disqualified from becoming a beneficiary under CARP (Section 11).
Transfer restrictions and repurchase rights
- Awarded lands acquired by beneficiaries under CARP or other agrarian reform laws cannot be sold, transferred or conveyed except through:
- hereditary succession,
- transfer to the government,
- transfer to LBP, or
- transfer to other qualified beneficiaries through DAR,
for ten (10) years (Section 12 amending Section 27).
- The children or spouse of the transferor have a right to repurchase from the government or LBP within two (2) years, after due notice of availability by LBP to the BARC and notice to PARCCOM by BARC (Section 12).
- Titles must indicate whether they are an emancipation patent or certificate of land ownership award, and subsequent transfer titles must reflect the same type (Section 12).
- If land is not fully paid, rights may be transferred or conveyed (with prior DAR approval) to an heir of the beneficiary or another qualified beneficiary who must cultivate the land personally; otherwise, land is transferred to LBP with due notice as specified for repurchase availability (Section 12).
- When land is transferred to LBP, LBP must compensate the beneficiary in one lump sum for amounts already paid plus the value of improvements (Section 12).
Support services and rural women rights
- At least forty percent (40%) of all appropriations for agrarian reform during the five (5)-year extension period must be set aside immediately for support services (Section 13 amending Section 36).
- DAR must pursue an integrated land acquisition and distribution and support services strategy requiring parallel planning and delivery (Section 13).
- For the next five (5) years, DAR must establish at least two (2) Agrarian Reform Communities (ARCs) in each legislative district with predominant agricultural population, in coordination with local government units, NGOs, community-based cooperatives and people’s organizations (Section 13).
- ARC areas must have been substantially covered by CARP and other agrarian/land reform laws, and DAR must adopt a complementary support services strategy for existing beneficiaries not in barangays within ARCs (Section 13).
- An ARC is composed and managed by agrarian reform beneficiaries willing to be organized to undertake integrated development of an area or their organizations/cooperatives; DAR, together with concerned agencies/organizations, must identify the farmers’ association, cooperative, or federation to lead agricultural development (Section 13).
- DAR, with congressional oversight committee coordination, must provide due notice to the concerned representative before implementation and is authorized to package proposals and receive grants, aids and other forms of assistance from any source (Section 13).
- Support services must be delivered through reforms that liberalize access to credit; DAR, Department of Finance, and BSP must institute such reforms (Section 14 amending Section 37).
- Thirty percent (30%) of all appropriations for support services must be immediately set aside for agricultural credit facilities (Section 14).
- Of the credit facilities appropriation, one-third (1/3) is for subsidies for initial capitalization for agricultural production to new agrarian reform beneficiaries upon awarding emancipation patent/certificate, while two-thirds (2/3) is for access to socialized credit to existing agrarian reform beneficiaries including leaseholders (Section 14).
- LBP and other government financial institutions, accredited savings and credit cooperatives, financial service cooperatives and accredited cooperative banks must provide disbursement delivery for the financial assistance (Section 14).
- Financing institutions may accept as collateral purchase orders, marketing agreements, or expected harvests (Section 14).
- Loans must be used for improvement/development of farmholding or establishment of facilities enhancing production/marketing and increasing farm income (Section 14).
- Of the remaining seventy percent (70%) support-services appropriation, fifteen percent (15%) is for farm inputs (seeds, seedlings/planting materials; organic fertilizers; pesticides; herbicides; and farm animals, implements/machineries), and five percent (5%) is for seminars/trainings to empower beneficiaries (Section 14).
- PARC must ensure support services are provided at all implementation stages with concurrence of concerned agrarian reform beneficiaries and must adopt/implement/monitor policies ensuring equality of women and men and respect for human rights, social protection, and decent working conditions (Section 14).
- The BKKK Secretariat must be transferred and attached to LBP for supervision including applicable funds, personnel, properties, equipment and records (Section 14).
- Misuse or diversion of provided financial and support services results in sanctions against the beneficiary, including forfeiture of the land or lesser sanctions as provided by PARC, without prejudice to criminal prosecution (Section 14).
- Support services must be extended equally to women and men agrarian reform beneficiaries (Section 15 inserting Section 37-A).
- PARC must integrate specific needs and well-being of women farmer-beneficiaries, ensure rural women’s participation in community activities, guarantee rural women’s entitlement to self-organization for equal access to economic opportunities, credit/loans, marketing facilities, technology and other support services, and equal treatment in land reform and resettlement schemes (Section 15).
- DAR must establish and maintain a women’s desk primarily responsible for formulating and implementing programs and activities related to women’s rights and providing an avenue to register complaints and grievances related to rural activities (Section 15).
Landowners support and agrarian reform bonds incentives
- PARC, with other directed government agencies, must provide landowners affected by CARP and prior agrarian reform programs with:
- investment information and financial/counseling assistance,
- facilities/programs for conversion or exchange of bonds into stocks and bonds issued by government institutions,
- marketing of agrarian reform bonds and promotion of their marketability,
- and other services designed to utilize proceeds for rural industrialization (Section 16 amending Section 38).
- A landowner investing in rural-based industries is entitled to incentives for registered enterprises engaged in pioneer or preferred areas under the Omnibus Investment Code of 1987, or other incentives provided by PARC, LBP, or other government financial institutions (Section 16).
- LBP must redeem landowner’s agrarian reform bonds at face value as an incentive, with at least fifty percent (50%) of proceeds invested in a BOI-registered company or in agri-business/agro-industrial enterprises in the region where CARP-covered landholding is located (Section 16).
- An additional incentive of two percent (2%) in cash is paid to a landowner who maintains the enterprise as a going concern for five (5) years or keeps investments in a BOI-registered firm for the same period (Section 16).
- The DAR, LBP and Department of Trade and Industry must jointly formulate the program to carry out these provisions under PARC supervision (Section 16).
- No landowner’s sex, economic, religious, social, cultural or political attributes exclude them from accessing support services (Section 16).
Governance, quasi-judicial powers, and court restrictions
- PARC composition includes the President as Chairperson, the Secretary of Agrarian Reform as Vice-Chairperson, specified department and government agency heads, representatives of affected landowners from Luzon, Visayas and Mindanao, representatives of agrarian reform beneficiaries (two from each region) with constraints that at least one is from indigenous peoples and at least one comes from a duly recognized national organization of rural women or a national organization of agrarian reform beneficiaries with substantial women members, and that at least twenty percent (20%) of PARC members are women but in no case less than two (Section 17 amending Section 41).
- DAR is vested with primary jurisdiction to determine and adjudicate agrarian reform matters and has exclusive original jurisdiction over all matters involving implementation of agrarian reform, except those under exclusive jurisdiction of DA and DENR (Section 18 amending Section 50).
- DAR is not bound by technical rules of procedure and evidence and must hear and decide cases expeditiously using all reasonable means to ascertain facts in accordance with justice and equity and the merits (Section 18).
- DAR must adopt a uniform rule of procedure to achieve just, expeditious and inexpensive determination of each action (Section 18).
- DAR may summon witnesses, administer oaths, take testimony, require submission of reports, compel production of books/documents/answers to interrogatories, issue subpoena and subpoena duces tecum, enforce writs through sheriffs or deputized officers, and punish contempts as in the Rules of Court (Section 18).