Law Summary
Lease of Public Lands for Fishpond Development
- Fishpond Lease Agreement (FLA) required to use public lands for fishpond development.
- The land must be declared available by the Secretary of Environment and Natural Resources and released for BFAR management.
Eligible Applicants for Fishpond Lease
- Filipino citizens at least 21 years old.
- Corporations with at least 60% Filipino ownership.
- Fisherfolk cooperatives or associations, and small to medium enterprises duly registered.
Preference in Disposition of Fishpond Lands
- Priority given to qualified fisherfolk cooperatives/associations.
- Existing lessees on expiration have priority to renew for another 25 years.
- Thereafter, lease granted to Filipino citizens with preference to fisherfolk cooperatives and small and medium enterprises.
Size of Fishpond Lease
- Individuals: up to 50 hectares.
- Husband and wife living together: aggregate 50 hectares; living separately may apply separately.
- Corporations/associations/cooperatives: up to 250 hectares.
- Government or scientific/educational use: up to 10 hectares via gratuitous permit.
Lease Period
- Initial term: 25 years.
- Renewable for another 25 years subject to law and conditions.
Preemptive Rights of Heirs
- Legal heirs (spouse/children) of deceased lessee may apply within 90 days to continue lease under original terms.
Initial Application Requirements
- Four copies of sketch plan and technical description.
- Comment from Land Management Bureau if within alienable land.
- Certified Articles of Incorporation/Association for juridical applicants.
- Bank certificate of initial capital of P10,000 per hectare or equivalent assets.
- Affidavit that capital is exclusive for fishpond development.
- Certification from DENR on area availability.
Application Fee
- Non-refundable P1,000 payable upon filing, remitted to National Fisheries Research and Development Institute.
Filing Date of Application
- Date of actual receipt by BFAR or Regional Office.
- Incomplete applications are rejected.
Priority of Applications
- First applicant gets preference if area is unoccupied and unimproved.
- Actual occupant has preference if qualified, must apply within 30 days.
- If simultaneous applications, preference to applicant best meeting qualifications and financial capacity.
Final Requirements for Lease Issuance
- Twelve copies of approved survey plan.
- Duly notarized lease contract.
- Certifications from BFAR Regional Director and Regional Trial Court affirming no pending cases.
- Payment of cash bond and initial rental.
- Certification that area is not subleased.
- Environmental Compliance Certificate from DENR.
Terms and Conditions of Lease
- Use restricted to fishpond purposes within leased boundaries.
- Lessor not responsible for legal claims against area.
- Construction must not interfere with navigation or tidal flow.
- Annual rentals to reflect resource rent; failure to pay leads to surcharge and possible cancellation.
- Improvements must be introduced within 180 days; area must be commercially productive within 3 years; failure to produce in 5 years results in reversion.
- Lease rights transferable with prior approval; subleasing prohibited.
- Reforestation of riverbanks and seashores required.
- Facilities to minimize pollution mandatory; failure leads to cancellation.
- Lease cancellation entails ejectment and forfeiture of improvements barring assignee-bank rights.
- Assignee-bank given 5 years to liquidate loan and transfer rights.
- Lessee must keep audited records; authorized officials may inspect.
- Subject to existing laws and regulations.
Rentals and Payment Schedule
- Graduated rental rates from P500 (year 1) to P1,000 (year 5) per hectare, payable by January each year.
- BFAR to study resource rent for future rate adjustments.
Surcharges for Late Rental Payment
- 10% for payments from Feb 1 to Mar 31.
- 15% for Apr 1 to Jun 30.
- 20% for Jul 1 to Sep 30.
- 25% for Oct 1 to Dec 31.
- 40% if paid after one year.
Cash Bond Deposit
- P100 per hectare before lease issuance as guaranty.
- May be credited against annual rental after 5 years and satisfactory compliance.
Incentives for Fishpond Workers
- Mandatory incentive plan distributing 7.5% of net profit before tax to regular workers within 60 days after fiscal year.
- Books subject to audit by CPAs chosen by workers.
Annual Reporting Requirement
- Lessee must submit sworn report on development, operation, production six months after lease approval and annually thereafter.
- Reports to be verified by BFAR Regional Director.
Grounds for Rejection of Application
- Applicant's lack/loss of interest, disqualification, non-compliance with requirements, death, dissolution, fraud, illegal occupation or improvements, or public interest.
Conditions for Assignment or Transfer
- Lease held for at least 3 years.
- Land developed and producing commercially unless abandoned due to loan enforcement.
- No violations of fishery laws.
- Transferee qualified.
- No pending cases on property.
- Transferee holds rights for unexpired term, assumes obligations.
Requirements for Assignment or Transfer
- Application form.
- Deed of Assignment/Transfer and Assumption of Obligations notarized.
- Proof of updated rental payments.
- Payment of assignment fee (min P100) and application fee (P1,000).
- Posting cash bond deposit.
- Verified report of improvements.
- Approved survey plan copies.
- Lease contract notarized.
- Certifications free from legal cases.
- Affidavit against sublease.
Grounds for Cancellation or Termination of Lease
- Violation of laws or terms of lease.
- Death of lessee (subject to heirs' rights).
- Dissolution of juridical person.
- Fraudulent information.
- Failure to report yearly.
- Non-payment of rentals for 2 consecutive years.
- Use for non-fishpond purposes.
- Subleasing.
- Change of citizenship.
- Failure to provide pollution control facilities.
Disposition of Improvements Upon Cancellation
- Improvements forfeited to government unless lease assigned to government financing institution.
Reversion of Abandoned or Underutilized Fishponds
- Areas abandoned or not producing commercially after 5 years may revert to mangrove state through restoration efforts.
Unlawful Occupation and Use
- Illegal occupants without lease before Order effectivity forfeit improvements and must vacate.
- Applicants paying double rent charges.
- Failure to pay may lead to fines (P5,000 minimum) or imprisonment (6 months to 4 years) or both.
Enforcement Actions
- Secretary, Director, or authorized representatives may initiate administrative or judicial action to enforce the Order.
- Adverse claims or protests must be filed within 30 days from knowledge.
Repealing Clause
- Previous FAs and inconsistent rules repealed or modified accordingly.
Effectivity
- Order effective 15 days after publication in official gazette or newspapers.