Title
Supreme Court
Amendments to Comprehensive Agrarian Reform Law
Law
Republic Act No. 7881
Decision Date
Feb 20, 1995
Republic Act No. 7881 amends provisions of the Comprehensive Agrarian Reform Program, clarifying definitions of agricultural activities, establishing exemptions for certain lands, and mandating profit-sharing incentives for fishpond and prawn farm workers while ensuring sustainable management and environmental protection.

Law Summary

Exemptions and Exclusions from Coverage

  • Lands used for parks, wildlife, forest reserves, reforestation, fish sanctuaries, breeding grounds, watersheds, mangroves are exempt
  • Private lands used exclusively for prawn farms and fishponds exempt, provided no prior CLOA distribution under CARP
  • If subject to CARL, majority consent of regular workers or tenants required to maintain exemption
  • If no prior CARL coverage, worker consent not required; Section 32-A incentives apply
  • Additional exemptions include lands for national defense, school sites/campuses, religious sites, burial grounds, penal colonies/farms, research centers, and lands with 18% slope or more except developed ones

Commercial Farming and Compulsory Acquisition

  • Private commercial farms in saltbeds, fruit, vegetable, cut-flower farms, cacao, coffee, rubber plantations
  • Subject to compulsory acquisition and distribution after 10 years from effectivity of the law or first year of commercial production for new farms
  • Government to pay just compensation
  • Preferential acquisition in favor of organized cooperatives or associations managing lands for worker-beneficiaries

Incentive Plan for Fishpond and Prawn Farm Owners

  • Owners/operators must execute incentive plan within 6 months with regular fishpond/prawn workers or their organizations
  • Distribute 7.5% of net profit before tax as additional compensation to workers within 60 days post fiscal year end
  • Owners’ financial books subject to periodic audit by worker-chosen CPAs
  • Provision does not apply where conversion of agricultural land to fishpond/prawn farm is within retention limit

Conversion of Agricultural Lands and Fishpond Development

  • Conversion of public agricultural lands to fishponds only allowed with provincial government and BFAR concurrence
  • DENR leases/develops after declaration; environmentally critical areas excluded
  • Approval guided by DAR and BFAR protocols; preference to small-farmer cooperatives for Fishpond Lease Agreements (FLAs)
  • Private land conversion capped at 5 hectares unless certified as more economically feasible, with majority worker or tenant approval
  • No piecemeal conversions allowed to evade limits
  • Section 32-A incentives apply upon approval

Inventory and Sustainable Management of Fishponds and Prawn Farms

  • BFAR to complete inventory of government and private fishponds/prawn farms within 1 year
  • No new leases granted before inventory completion
  • Sustainable management to comply with pollution control, effluent standards, and water use regulations
  • Relevant authorities include FPA, EMB, and compliance with Water Code (PD 1067)

Protection of Mangrove Areas

  • Existing and future FLAs must establish a buffer zone along the sea front planted with mangrove species
  • Guidelines and penalties for violations set by Secretary of Environment and Natural Resources

Change of Crops Provision

  • Changing to commercial or high-value crops is not a land use conversion
  • Should not prejudice tenant or leaseholder rights
  • Requires consent of majority of affected workers

Exception to Sale and Transfer Restrictions

  • Sale or transfer of agricultural land allowed if due to bank foreclosure of mortgaged land, notwithstanding prior restrictions

Separability Clause

  • Invalidity of any provision will not affect the validity of the remaining provisions

Effectivity Clause

  • The Act takes effect 15 days after publication in two newspapers of general circulation

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