Law Summary

I. Coverage

• Explanation: This memorandum circular applies to Agrarian Reform Beneficiaries (ARBs) who have fully paid their land amortizations under specific legislations.
• Key Definitions:
  • Agrarian Reform Beneficiaries (ARBs): Individuals awarded land under agrarian reform laws.
• Important Requirements:
  • ARBs must have fully paid land amortizations and applicable interests to the Land Bank of the Philippines (LBP).
• Relevant Cross-References:
  • R.A. No. 6657
  • Presidential Decree (P.D.) No. 27
  • Executive Order (E.O.) No. 228

II. Legal Bases

• Explanation: The issuance guidelines are grounded in specific legal provisions regarding land payments.
• Key Definitions:
  • Amortization: The process of gradually paying off debt over time through scheduled payments.
• Important Requirements:
  • Payments are structured over a period of thirty (30) years at an interest rate of six percent (6%) per annum as per R.A. No. 6657 and E.O. No. 229.
  • Under E.O. No. 228, farmers may opt for a twenty (20) year payment plan, with provisions for full payment or restructuring.
• Cross-References:
  • Section 26 of R.A. No. 6657
  • Section 12 of E.O. No. 229
  • Section 6 of E.O. No. 228
  • Section III, Item 2 of DAR AO No. 1, series of 2011
  • DOJ Opinion No. 67, series of 2013

III. General Guidelines and Procedures in the Determination of the Land Amortizations

• Explanation: This section outlines the procedures ARBs must follow to determine their land amortizations.
• Key Requirements:
  • For R.A. No. 6657, payments are based on the Notice of Land Valuation and Acquisition (NLVA).
  • For P.D. 27/EO 228, payments are based on the Land Valuation Summary and Farmer’s Undertaking (LVSFU).
• Timeframes:
  • Adjustments based on the Claims Adjustment Folder (CAF) or Final Survey Documents (FSD) must occur prior to processing the Certificate of Full Payment (CFP) and Release of Real Estate Mortgage (ROREM).
• Consequences:
  • Amortization payments remain based on original values, regardless of court-awarded higher valuations.

IV. Issuance of Certificate of Full Payment and Release of Real Estate Mortgage

• Explanation: This section details the process for ARBs to obtain their CFP and ROREM from LBP after full payment.
• Important Requirements:
  • Upon full payment, LBP issues a CFP and ROREM to facilitate the cancellation of liens on the Emancipation Patent (EP) or Certificate of Landownership Award (CLOA).
• Procedures:
  • The CFP integrated with ROREM must be notarized and registered with the Register of Deeds.
  • LBP will issue operational procedures aligned with accounting and auditing regulations.

V. Effectivity

• Explanation: The guidelines take immediate effect upon issuance.
• Key Details:
  • Effective Date: December 23, 2013
  • Issued by: Secretary Virgilio R. De Los Reyes and President Gilda E. Pico of LBP.

Key Takeaways

• The guidelines facilitate the issuance of CFP and ROREM for ARBs who have fully settled their land amortizations.
• The procedures ensure that ARBs are not adversely affected by increases in land valuations post-payment.
• Full compliance with payment structures under the relevant laws is essential for obtaining the necessary documentation for land ownership free of encumbrances.