Policy and legal basis (Supreme Court guidance)
- The guidelines are prescribed to implement Supreme Court rulings governing retention rights under P.D. No. 27 and to align exercise of those rights with later agrarian reform statutes.
- The order applies the Supreme Court rule that landowners unable to exercise retention rights under P.D. No. 27 shall enjoy the retention rights granted by Republic Act No. 6657 under the conditions prescribed in Republic Act No. 6657.
- The order applies the Supreme Court rule that landowners who complied, before the Comprehensive Agrarian Reform Program (CARP), with the registration requirements under LOI Nos. 41, 45 and 52 are allowed to enjoy the seven hectare retention limit provided in P.D. 27.
- The order applies the Supreme Court rule that landowners who continuously refused to comply with the registration requirement cannot demand that their retention limit be determined under P.D. 27 because of the effect of CARL.
Core retention entitlements and hectare limits
- Landowners covered by P.D. No. 27 are entitled to retain seven hectares, except those whose entire tenanted rice and corn lands are subject of acquisition and distribution under Operation Land Transfer (OLT).
- For landowners with tenanted rice and corn lands, retention of those lands is barred in the following cases:
- If, as of 21 October 1972, the landowner owned more than 24 hectares of tenanted rice or corn lands; or
- By virtue of LOI 474, if, as of 21 October 1976, the landowner owned less than 24 hectares of tenanted rice or corn lands but additionally owned:
- Other agricultural lands of more than seven hectares, whether tenanted or not, whether cultivated or not, and regardless of the income derived therefrom; or
- Lands used for residential, commercial, industrial, or other urban purposes, from which the landowner derives adequate income to support himself and his family.
- Landowners who filed their applications for retention before 27 August 1985 (the deadline set by Administrative Order No. 1, series of 1985) may retain not more than seven hectares regardless of compliance with LOI Nos. 41, 45 and 52.
- Landowners who filed their applications for retention after 27 August 1985 but complied with LOI Nos. 41, 45 and 52 are entitled to a seven-hectare retention area.
- Landowners who filed their applications for retention after 27 August 1985 and did not comply with LOI Nos. 41, 45 and 52 are entitled to only a maximum of five hectares as retention area.
Waiver, death-related conditions, and tenant rights
- A landowner is deemed to have waived the right of retention over a parcel of land by performing any of the following acts:
- Signing of the Landowner-Tenant Production Agreement and Farmer’s Undertaking (LTPA-FU) covering the subject property;
- Entering into a direct-payment scheme agreement as evidenced by a Deed of Transfer over the subject property; and
- Signing/submission of other documents indicating consent to have the subject property covered, such as the form letter of the Land Bank of the Philippines (LBP) on the disposition of the cash and bond portions of a land transfer claim for payment, and the Deed of Assignment, Warranties and Undertaking executed in favor of the LBP.
- A landowner who has died must have manifested during his lifetime an intention to exercise the right of retention prior to 23 August 1990 to allow heirs to exercise retention under these guidelines.
- Heirs must show proof of the original landowner’s intention, and heirs may exercise the right of retention if they prove that the decedent had no knowledge of OLT coverage over the subject property.
- Tenant-farmer rights previously acquired under P.D. No. 27 are retained and recognized.
- Section II(d), (e), (h) and (i) of Administrative Order No. 11, Series of 1990 governs the retention-related rights and award to children under Section 6 of Republic Act No. 6657.
- For landowners who own lands other than rice and corn, the landowner is directed to select the area to retain from these “other lands” to prevent or minimize possible dislocation of farmer-beneficiaries who have been issued Certificates of Land Transfer (CLTs) or Emancipation Patents (EPs).
- Where CLT- or EP-holders are in the area to be retained, the DAR must:
- Immediately inform the tenants concerned and provide them the opportunity to dispute or contest the landowner’s claim; and
- Ensure that affected tenants, if they so desire, receive priority in the distribution of other lands of the landowner or other lands identified by the DAR for redistribution, subject to the rights of those already in place.
- Tenants may opt to remain in the retained area as leaseholders, and the required lease agreements must be executed under existing laws, rules, and regulations.
- Tenants must exercise the leaseholder option within one (1) year from the time the landowner manifests his choice of the area for retention.
Retention case handling by offices
- The Municipal Agrarian Reform Officer (MARO) must receive the landowner’s application for retention using Ret. Form No. 1.
- The MARO must invite all concerned parties to a conference/dialogue regarding the application using Ret. Form No. 2.
- The MARO must conduct field verification and investigation using Ret. Form No. 3, covering:
- The landholding of the landowner in relation to the application for retention; and
- Tenants or actual occupants.
- In collaboration with the Land Management Sector and the DENR, the MARO must prepare a sketch plan of the area to be retained by the landowner.
- The MARO must evaluate documents and, based on findings, submit a recommendation to the Provincial Agrarian Reform Officer (PARO).
- The PARO must review and evaluate the MARO’s report and recommendation.
- If the documents are in order, the PARO must forward them with the PARO’s findings and recommendations to the Regional Agrarian Reform Officer (RARO); otherwise, the PARO must return the documents to the MARO.
- The RARO must review and evaluate documents submitted by the PARO and then either:
- Issue an Order of Approval attaching the sketch plan of the retained area; or
- Issue an Order of Denial.
- The Order of Approval must state that the retained area is subject to final survey, and the RARO must issue a Certificate of Retention (Ret. Form No. 4) only after the final survey of the retained area.
- The RARO must forward the Order of Approval or Order of Denial to the PARO for distribution to concerned parties.
- The order of the Regional Director (approving or denying) becomes final after fifteen (15) days from receipt, unless an appeal is made to the DAR Secretary.
- The MARO must cause the institution of leasehold arrangements in lands covered by the order of retention in accordance with Administrative Order No. 4, Series of 1989.
Transitory application of deadlines and Supreme Court rulings
- Applications filed before 27 August 1985 govern retention limits without regard to compliance with LOI Nos. 41, 45 and 52.
- Applications filed after 27 August 1985 govern retention limits based on whether the landowner complied with LOI Nos. 41, 45 and 52.
- Eligibility of heirs depends on the original landowner’s manifestation of intent prior to 23 August 1990, or proof that the decedent had no knowledge of OLT coverage over the subject property.
- Landowners covered by P.D. No. 27 retain seven hectares unless barred due to OLT coverage of the entire tenanted rice and corn lands or due to the ownership and additional-land disqualifications stated for rice and corn tenancies.