Policy, purpose, and legal basis
- The Order implements the Philippine Fisheries Code of 1998 (Republic Act No. 8550) governing fishery matters related to fishpond development and leasing of public lands.
- It is also anchored on Republic Act No. 7881, Section 4, as one of the cited legal bases for fishery-related public-land disposition and rules.
- It establishes a regulatory framework for leasing public lands for fishpond development, including eligibility, requirements, lease terms, rentals, sanctions, and environmental compliance.
- It formalizes how BFAR and the Department of Agriculture manage and dispose of released public lands for fishpond purposes.
Core definitions for fishpond leasing
- A Fishpond Lease Agreement (FLA) is an agreement between the Secretary of Agriculture and a qualified fishpond applicant for use of public land for fishpond development for a period of twenty-five (25) years.
- A Permanent improvement is an improvement introduced in the fishpond area that cannot be separated/removed without causing damage thereto.
- A Temporary improvement is an improvement introduced in the fishpond that can be removed/separated without causing damage thereto or diminishing its usefulness.
- A Fishpond is a land-based facility enclosed with earthen, stone or concrete material to impound water for growing fish.
- Fish includes finfish and mollusks, crustaceans, echinoderms, marine mammals, and all other species of the aquatic flora and fauna.
- Occupied means actual or constructive possession over the fishpond area; Unoccupied means not occupied by any person, or occupied by a person disqualified to acquire or enter upon it, or occupied by a qualified person who refuses or fails to exercise a preferential right.
- Mangroves/tidal swamps/marshes are intertidal plants, including trees, shrubs, vines and herbs on coasts, swamps, or the border of swamps.
- Foreshore land is defined as the margining part of a seashore between the low-water line and the upper limit of wave wash at high tide, usually marked by a beach scarp or berm.
- Vegetated with mangrove species means an intertidal area of one (1) hectare or more with at least ten (10) percent mangrove crown cover in each hectare.
- Suitable for fishpond purposes means meeting accepted criteria on elevation, soil type, soil depth, topography, and water supply for successful fishpond development.
- Undeveloped fishpond area includes areas not enclosed by dikes; enclosed by dikes without functional water control structures; enclosed with functional water control structures but without maintaining production water levels at commercial scale by high tides or pumping; or a larger area enclosed only by a simple perimeter dike that has not been subdivided and is not producing at commercial scale.
- Developed fishpond means enclosed by dikes with functional water control structures not vegetated with mangrove species and producing on a commercial scale, but not fully developed.
- Fully developed fishpond means a clean, leveled area enclosed with dikes at least one foot higher than the highest flood water level and strong enough to resist water pressure at the highest flood tide; consisting of at least a nursery pond and a functional water control system, producing on a commercial scale.
- Commercial-scale producing fishpond produces not less than 1000 kilograms of fish per hectare per year.
- Person includes natural or juridical entities such as individuals, associations, partnerships, cooperatives or corporations.
- Fisherfolk are people directly and physically engaged in taking and/or culturing and processing fishery and/or aquatic resources.
- Fisherfolk cooperative is a duly registered fisherfolk association with a common bond of interest, with equitable contribution of capital and acceptance of fair share of risks and benefits under universally accepted cooperative principles.
- Fisherfolk organization is an organized group of at least fifteen (15) members with officers, constitution and by-laws, organizational structure, and program of action.
- Small and medium enterprise is defined by asset value ranges (inclusive of assets arising from loans, exclusive of the land where office/plant/equipment are situated):
- Micro: less than P1,5000,001
- Small: P1,500,001 to P15,000,000
- Medium: P15,000,001 to P60,000,000
- An Environmental Compliance Certificate (ECC) is a permit issued certifying that new fishpond development will not bring about unacceptable environmental impact and that the proponent complied with the EIS system requirements.
- Department means the Department of Agriculture; Secretary means the Secretary of Agriculture; Bureau means the Bureau of Fisheries and Aquatic Resources; Director means the Director of Fisheries and Aquatic Resources.
- Regional Office means BFAR Regional Office; Regional Director means BFAR Regional Director.
- Authorized representatives include the BFAR Regional Director or designated regional officials and other BFAR or Secretary officials/employees duly designated.
- Resource rent is the difference between the value of products produced from harvesting a publicly owned resource and the cost of producing it, where cost includes normal return to capital and normal return to labor.
Leasing coverage and eligible applicants
- Fishpond leases must be secured by a person who will occupy or use any portion of public lands declared by the Secretary of Environment and Natural Resources as available for fishpond purposes and released to the Bureau for management and disposition under the Order.
- Section 4 establishes the preference framework for who receives FLAs based on existing FLAs and qualifications tied to fisherfolk cooperatives/associations and Filipino citizens.
- The following may apply for fishpond lease (Section 3):
- Filipino citizens at least twenty-one (21) years of age.
- Corporations duly incorporated and registered in the Philippines with at least sixty percent (60%) of capital stock or interest owned by Filipino citizens.
- Fisherfolk cooperatives/associations and small and medium enterprises duly organized or registered in the Philippines.
- The lease must be issued only over the public land released for fishpond purposes and covered by the applicable area descriptions, surveys, and certifications required by the Order.
Preference and lease size limits
- FLAs may be issued upon effectivity of Republic Act No. 8550 for public lands declared available for fishpond development primarily to qualified fisherfolk cooperatives/associations.
- For existing FLAs, the current lessees receive priority upon expiration and are entitled to an extension of another twenty-five (25) years for their respective leased areas.
- After such extensions, FLAs are granted to Filipino citizens with preference primarily to qualified fisherfolk cooperatives/associations and also to small and medium enterprises as defined under Republic Act No. 8289.
- Maximum fishpond areas are governed by Section 5:
- An individual may lease not exceeding fifty (50) hectares.
- Husband and wife living together may receive an aggregate area not exceeding fifty (50) hectares, and husband and wife living separately by virtue of a decree of legal separation may apply for not exceeding fifty (50) hectares each.
- A corporation, association or cooperative may be granted not exceeding two hundred fifty (250) hectares.
- Any branch of government, person, or association engaged in fishpond development for scientific, research or education purposes may be granted not exceeding ten (10) hectares through a gratuitous permit.
- The maximum area rules apply to the area to be leased as determined by the application and the lease grant.
Lease term, succession rights, and applications
- The lease period is twenty-five (25) years and is renewable for another twenty-five (25) years, subject to Section 4 of the Order, the lease terms and conditions, and other existing fishery laws, rules and regulations.
- Heirs receive preemptive rights under Section 7:
- On the death of the lessee, the spouse and/or children who are qualified may apply for the unexpired term of the FLA.
- The application must be filed within ninety (90) days from the death of the lessee.
- The preemptive rights apply subject to the same terms and conditions as originally provided.
- Initial requirements for filing a fishpond lease application require:
- Four (4) copies of a sketch plan with technical description extracted from the Land Classification Map of the Forest Management Bureau.
- If the area is within alienable and disposable land under the Land Management Bureau, the Land Management Bureau comment must first be secured stating it interposes no objection to issuance.
- If the applicant is a juridical person: two (2) certified true copies of Articles of Incorporation or Association approved by concerned government agencies, with the primary purpose to engage in fishpond development.
- A certificate of bank deposit showing initial capital in cash of P10,000.00 per hectare or fraction thereof and/or equivalent assets.
- An affidavit declaring the deposited initial capital is used exclusively for development of the area.
- Certification from DENR that the area is available for fishpond development.
- An application must be supported by an application fee under Section 9:
- A non-refundable application fee of One Thousand (P1,000.00) pesos is paid to the Bureau or its Regional Offices upon filing.
- The fee is remitted to the National Fisheries Research and Development Institute (NFRDI).
- An application is considered filed when the original application is actually received by the Bureau or the Regional Office where the area is located.
- Applications with incomplete initial requirements are not processed.
- Priority rules for determining which application is preferred require:
- If two or more applications are filed for the same area that is unoccupied or unimproved, the first applicant has preference.
- Between an applicant and a bona fide occupant, the occupant has preference; the Director advises the occupant to file within thirty (30) days from receipt of notice.
- If the occupant is not qualified to apply or fails/refuses to file within thirty (30) days, the occupant must vacate.
- If two or more applications are filed for the same area on the same date, the applicant that best meets fisheries law and regulation requirements based on financial capacity and/or qualification has preference.
- Final issuance requirements for a fishpond lease include:
- Twelve (12) copies of the survey plan approved by the Director of Lands or the Regional Director of Lands, or certified by the Bureau of Lands for cadastral surveys.
- A duly accomplished fishpond lease contract form acknowledged before a Notary Public.
- Certifications from the BFAR Regional Director and the Regional Trial Court in the judicial district to confirm no pending administrative case and no pending judicial case, respectively.
- Payment of cash bond deposit and initial rental.
- BFAR Regional Director certification that the area is not subleased to any other person/s.
- Environmental Compliance Certificate (ECC) from DENR.
Rentals, surcharges, and cash bond rules
- Annual rentals are set in Section 14 with fixed rates starting from effectivity tied to the year 2000 schedule, using hectare or fraction thereof:
- First year (Jan 1, 2000 to Dec 31, 2000): P500.00 per hectare
- Second year: P600.00 per hectare
- Third year: P700.00 per hectare
- Fourth year: P800.00 per hectare
- Fifth year: P1,000.00 per hectare
- After the fifth year: rentals continue yearly thereafter.
- Rentals must be paid not later than the last working day of the month of January of each year.
- BFAR conducts a study on resource rent of public lands for fishpond development, and the study results become the basis for future rental rates.
- Surcharges for late rental payment follow Section 15:
- Rentals paid from February 1 to March 31: 10%
- Rentals paid from April 1 to June 30: 15%
- Rentals paid from July 1 to September 30: 20%
- Rentals paid from October 1 to December 31: 25%
- Rentals paid after one (1) year: 40%
- Before a lease is issued, applicants must deposit a cash bond:
- The cash bond is P100.00 per hectare or fraction thereof.
- After five (5) years, and when the LESSEE fully developed the area and has made it producing on a commercial scale and complied with all lease terms and requirements, the Director may credit the cash bond for payment of annual rentals.
Lease conditions, transfer limits, environmental duties
- The leased fishpond area must be confined within the leased parcel perimeter and used for fishpond purposes only.
- The leased area is treated as public land, and the LESSOR is not responsible for loss caused by any legal award of the area to a claimant recognized by the Courts.
- Fishpond construction must not interfere with navigation of streams/rivers, migration paths, lakes or bays adjoining the fishpens, fish cages, fish traps, and fishponds, and must not impede tidal flow to and from the area.
- Any construction made in violation of navigation/tide-flow requirements must be removed by order of the Department through BFAR in coordination with other agencies, at the expense of the LESSEE or occupants, when applicable.
- Annual rentals:
- The Department through BFAR sets rentals reflecting resource rent.
- Failure to pay annual rentals on the due date subjects the LESSEE to surcharges under the rules.
- Failure to pay rentals and surcharges for two (2) consecutive years without justifiable cause results in cancellation or termination of the lease and forfeiture of the bond in favor of the government, without prejudice to government actions to recover rentals and surcharges.
- Development timeline requirements:
- The LESSEE must introduce improvements within One Hundred Eighty (180) Days from issuance of the lease; failure results in cancellation.
- The fishpond must be developed and producing on a commercial scale within three (3) years from approval of the FLA.
- Areas not fully producing within five (5) years from approval of the lease automatically revert to the public domain for reforestation.
- Transfer and assignment:
- The LESSEE may transfer leasehold rights covering all or any portion subject to prior written approval of the LESSOR, and the transferee’s duration is only the unexpired period.
- The LESSEE may assign leasehold rights to any financial institution to secure a loan for development subject to prior written approval of the LESSOR.
- The LESSEE is prohibited from subleasing all or any portion of the leased area through any arrangement that partakes the nature of a sub-lease.
- Reforestation duty:
- The LESSEE must undertake reforestation on river banks, bays, streams and the seashore fronting the fishpond dike with at least a 50 meters strip when applicable, considering area/situation/topography/water depth and subject to future DENR rules.
- Environmental pollution minimization:
- The LESSEE must provide facilities that minimize environmental pollution (e.g., settling ponds, reservoirs).
- Failure to comply cancels the FLA.
- Cancellation and ejectment:
- On cancellation for cause, ejectment of the LESSEE and/or occupants is ordered by the LESSOR or authorized representative.
- Failure to vacate triggers applicable legal consequences and forfeiture of all existing improvements in favor of government, subject to assignee-bank rights if applicable under assignment rules.
- Assignment default and assignee-bank time window:
- If the LESSEE defaults on the loan and the assignee-bank enforces the assignment, the assignee-bank has a period of five (5) years after enforcement to hold the area to liquidate the debt, dispose of improvements, and negotiate transfer to other qualified transferees meeting LESSOR requirements.
- The assignee-bank must notify the LESSOR when enforcement begins.
- If no transfer is effected after five (5) years, the area automatically reverts to the LESSOR for proper disposition, subject to assignee-bank rights.
- Records and inspection:
- The LESSEE must keep records of fishpond operations and transactions, audited by an independent auditor commissioned by the LESSEE.
- The LESSOR’s duly authorized representative may inspect and validate required operational records.
- Lease is subject to existing laws, rules and regulations on the matter.
Incentives and labor compensation requirements
- Holders of fishpond lease agreements must execute an incentive plan within six (6) months from effectivity with regular fishpond or prawn farm workers or their workers’ organization (if any).
- Under the incentive plan, 7.5% of net profit before tax from fishpond or prawn farm operations must be distributed within 60 days at the end of the fiscal year as compensation to regular and other pond workers, over and above current compensation.
- Worker rights are safeguarded by requiring that fishpond or prawn farm owners’ books be periodically audited or inspected by certified public accountants chosen by the workers.
Reporting duties and annual report timelines
- The LESSEE must submit an annual report under oath relative to fishpond development, operation and production, including species and volume, for statistical and evaluation purposes.
- Reports must be submitted to the Director through the concerned Regional Director:
- Within ten (10) days after six (6) months from approval of the lease; and
- Every one (1) year thereafter.
- The annual report must be in a prescribed form duly verified and certified by the concerned Regional Director or duly authorized representative.
Grounds for rejecting applications
- The Bureau rejects an application for fishpond lease on grounds including:
- Lack or loss of interest of the applicant.
- Applicant is not qualified.
- Failure to comply with requirements under Section 11 within sixty (60) days from receipt of Notice of Compliance.
- Death of the individual applicant.
- Dissolution of a juridical person.
- Fraudulent, false or misleading statements or information in the application.
- Occupying or introducing improvements in the applied-for area without a fishpond lease agreement.
- When public interest requires.
Grounds for cancellation and disposition effects
- A lease is cancelled or terminated on grounds including:
- Violation of existing fishery laws, rules and regulations and other applicable laws.
- Death of the lessee, subject to heirs’ rights under Section 7.
- Dissolution of a juridical person.
- Fraudulent, false or misleading statements or information in the application and/or other documents prior to or after issuance.
- Failure to submit yearly reports.
- Failure to pay rentals and surcharges for two (2) consecutive years.
- Development of the area other than for fishpond purposes.
- Failure to comply with lease rules, terms and conditions.
- Sublease of the area or any portion.
- The LESSEE acquiring citizenship in another country during the existence of the FLA.
- Failure to provide pollution-minimizing facilities (e.g., settling ponds, reservoirs).
- When a lease is cancelled or terminated and leasehold rights are not assigned to any government financing institution, the existing improvements on the area are automatically forfeited to the government and disposed of by the Bureau under applicable laws and rules.
Rules on abandoned, undeveloped, and unlawful occupation
- Fishpond areas under an existing FLA that are jointly determined by DA, DENR and LGUs concerned as abandoned, undeveloped or underutilized portions after five (5) years from issuance of the FLA must be reverted to their original mangrove state, with necessary steps taken to restore them.
- Unlawful occupation of public lands released for fishpond purposes is penalized:
- Any person illegally occupying or introducing improvements in areas released for fishpond development without a lease prior to effectivity of this Order forfeits all improvements introduced in favor of government and must vacate immediately.
- If the illegal occupant is an applicant, the person is charged double the ordinary rental charges.
- If the applicant fails or refuses to pay the charges, the applicant is liable for prosecution and, upon conviction, suffers a penalty of a fine of Five Thousand (P5,000.00) pesos or imprisonment of six (6) months to four (4) years, or both, at the Court’s discretion.
Assignment conditions and required papers
- Assignment/transfer is allowed only if conditions are met:
- The assignor/transferor has held the lease for at least three (3) years from approval.
- The area proposed for assignment/transfer is developed and producing on commercial scale, except when the area is abandoned by the lessee-assignor due to enforcement by the assignee-bank.
- The assignor/transferor has not violated fishery laws and rules on fishpond development and lease terms and conditions.
- The assignee/transferee is qualified to hold the lease under the Order.
- The area subject is not involved in any administrative or judicial case.
- The transferee holds only the unexpired period and assumes the transferor’s obligations.
- The assignee/transferee must submit:
- An accomplished application form.
- Original/duplicate Deed of Assignment/Transfer of Leasehold Rights and Interests and Assumption of Obligations.
- Certified true copies of original official receipts of updated rental payments.
- Assignment/transfer fee of P10.00 per hectare or fraction thereof, but not less than One Hundred (P100.00) pesos.
- Application fee of P1,000.00.
- Posting of the required cash bond deposit.
- Latest report of improvements duly inspected and verified by the Regional Director or authorized representative.
- Twelve (12) copies of the survey plan approved by the Director of Lands or Regional Director of Lands under the transferee’s name.
- A duly accomplished fishpond lease contract form acknowledged before a Notary Public.
- Certifications from the BFAR Regional Director and the Regional Trial Court in the judicial district confirming no pending administrative and judicial cases, respectively.
- Affidavit and certification by the applicant and BFAR Regional Director, respectively, that the area is not subleased to any person/s.
Administrative and protest procedure
- The Secretary, the Director, or their duly authorized representative may take administrative or judicial action as necessary to implement the Order.
- Adverse claim or protest rules apply to twenty-five (25) year lease matters:
- A person must file adverse claim or protest with the Bureau within thirty (30) days from knowledge thereof.
- Failure to file within the period results in non-entertainment of the claim or protest.
Repeals and effectivity
- Fisheries Administrative Order No. 60, as amended, Fisheries Administrative Order No. 125, and existing fishery rules and regulations inconsistent with this Order are repealed or modified accordingly.
- The Order takes effect 15 days after publication in the Official Gazette and/or in two (2) newspapers of general circulation.