An Act Liberalizing the Lease of Private Lands by Foreign Investors (Republic Act No. 12252)

SECTION 1. Section 2 of Republic Act No. 7652, otherwise known as the "Investors' Lease Act'', is hereby amended to read as follows: "SEC. 2. Declaration of Policy. - It is hereby declared the policy of the State to encourage foreign investments consistent with the constitutional mandate to conserve and develop our own patrimony. 2 3 Towards this end, the State hereby adopts a flexible known as the 'Corporate Recovery and Tax Incentives and dynamic policy on the granting of long-term for En~rprises Act' or 'CREATE', as amended by lease on private lands to foreign investors for the Republic Act No. 12066, otherwise known as the establishment of industrial estates, factories, 'CREATE MO_RE'~ct; or under other applicable laws, assembly or processing plants, agro-industrial or has complied with the investment requirements enterprises, land development for industrial or prescribed by the appropriate Investment Promotion commercial use, tourism, agriculture, agro-forestry, Agency (IPA) pursuant to existing laws; ecological conservation and other similar priority productive· endeavors. (5). The lease contract shall be registered with the Registry of Deeds of the province or city where It is the policy of the State to ensure the the leased area is located and annotated on the reliability of investors' lease contracts to provide a certificate of title covering the leased area; and stable environment for foreign investments." (6) The Register of Deeds shall register the "SEC. 2. Section 4 of Republic Act No. 7652 is, hereby lease contract if all of the following conditions exist: amended to read as follows: _ (a) The investor presents proof.of an approved and registered 1nvestment under subparagraph 4 hereof; '·SEC. 4. Coverage. Any foreign investor investing in the Philippines shall be allowed to lease ' (b) The date of commencement and maximum private lands in accordance with the laws of the duration of the lease are certain; Republic of the Philippines subject to the following conditions: . _ (c) The technical description of the property sub1ect of the lease is clearly specified; (1) The aggregate period of the lease contract shall not exceed ninety-nine (99) years: Provided, ., (d) 'J'he lessee has performed preparatory acts That upon the recommendation of the Fiscal for the commencement of its investment project; and Incentives Review Board (FIRB) or other relevant government agencies. the President of the Philippines (e) There is a provision in the lease contract may impose a shorter lease period for investors providing for its termination in case of a change in engaged in vital services or industries considered as ~he purpose or project for which the lease was critical infrastructure, in the interest of national mtended, or in case of failure to commence the security or pursuant to government-identified investment project within a reasonable period from priorities for national development; the signing of the lease contract. (2) The leased area shall be used solely for the 'J'he leasehold rig?t acquired under long-term purpose of the approved and registered investment lease contracts entered mto_ pursuant to this Act may upon the mutual agreement of the parties; be s~ld, transferred, a~s1gned, or may serve as security for a l?an: Provided, That when the buyer, (3) The. leased premises shall comprise such tran~feree, assignee, or creditor is a foreigner or area as may reasonably be required for the purpose foreign-owned enterprise, the conditions and of the approved and registered investment subject limitations in respect to the use of the leased however to the Comprehensive Agrarian Reform Law property as provided under this Act shall continue and the Local Government Code; and to apply." (4) The foreign investor must have an approved and registered investment under Republic Act No. 7042, otherwise known as the 'Foreign Investments Act of 1991', as amended; Republic Act No. 11534, otherwise ../ 5 SEC. 3. A new Section 4-A is hereby inserted after (5) In the case of tourism projects, lease of

Section 4 of Republic Act No. 7652. to read as follows: private lands by qualified forei~n investors shall be limited to projects with an investment of not less "SEC. 4-A. Operative Act of Registration. - The than Five million US dollars (USD 5,000,000.00), registration of the long-term lease contract shall be seventy percent (70%) of which shall be infused in the operative act that renders the lease binding said project within three (3) years from the signing against third persons. Registration shall be made in of the lease contract." accordance with the provisions of Presidential Decree No. 1529, as amended. SEC. 5. A new Section 5-A is hereby inserted after

Section 5 of Republic Act No. 7652, to read as follows: A registered lease contract shall not be subject to collateral attack. It cannot be altered. modified, ''SEC. 5-A. Sublease. - Uuless there is an or cancelled, except in a direct proceeding in express prohibition in the lease contract, the lessee • accordance with law." may sublet the property with the consent of the lessor. The conditions under Sections 4 and 5 of this SEC. 4. Section 5 of Republic Act No. 7G52 1s hereby Act shall apply to the sublease contract." amended to read as follows: • i SEC. G. A new Section 5-B is hereby inserted after the "SEC. 5. Limitations. - new Section 5-A of Republic Act No.' 7652, to read as follows; (1) Foreign individuals. corporations, , "SEC. 5-B. Registration of Sublea.se Contracts. associations, or partnerships not otherwise investing - Sublease contracts shall be registered with the in the Philippines as defined herein shall continue Registry of Deeds and annotated on the Certificate to be covered by Presidential Decree No. 4 71 and of Title to the land." other existing laws on lease of lands to foreigners: • SEC. 7. Section 6 of Republic Act No. 7652 is hereby (2) Withdrawal of the approved and registered amended to read as follows: investment in the Philippines within the period of the lease contract entered into under this Act. or use ''SEC. 6. Termination of Lease Contract. - In of the leased area for the purpose other than that case of failure to commence the investment project authorized, shall warrant the ipso facto terminatwn within three (3) years from the signing of the lease of the lease contract without prejudice to the right contract, the FIRB, Board of Investments (BO1), or of the lessor to be compensated for the damages the the relevant IPA, as applicable, shall order the lessee lessor may have suffered thereby: to explain the delay and if merited, require such lessee to commence the project within a reasonable (3) Any lease contract under this Act which is period. Failure to comply with the order and to renewable at the option of the lessee subject to the initiate the project within the period provided may, same terms and condition:, of the original contract after due notice and hearing, cause the revocation shall be interpreted to mean as renewable upon the of all entitlements granted under this Act." mutual agreement of the parties: (4) In addition to the conditions for the renewal of a lease contract. the foreign lessee shall show that it has made social and economic contributions to the country; and 6 7 SEC. 8. Section 7 of Republic Act No. 7652 is hereby SEC. 11. Repealing Cla.use. - All laws, decrees, orders, amended to read as follows: issuances, rules, and regulations or parts thereof that are inconsistent with this Act are hereby repealed or modified "SEC. 7. Penal Provision. - Any contract made accordingly. or executed in violation of any of the following prohibited acts shall be null and void ab initio and SEC. 12. Effectivity. - This Act shall take effect after both contracting parties shall be punished by a fine fifteen (15) days following its complete publication in the of not less than One million pesos (Pl,000,000.00) but Official Gazette or in a newspaper of general circulation. not more than Ten million pesos (Pl0,000,000.00) or imprisonment of six (6) months to six (6) years, at the discretion of the court: Approved, (1) Any provision in the lease contract stipulating a lease period in excess of that provided in paragraph (1) of Section 4; ;:;;;t!fi G ESCUDERO President of the Senate (2) Use of the leased premises for a purpose of Representatives contrary to existing laws of the land, public order, public policy. morals, or good customs; This Act, which is a consolidation of Senate Bill (3) Any agreement resulting in the lease of No. 2898 and House Bill No. 10755. was passed by the land in excess of the approved area: Provided, That, Senate of the Philippines and the House of Representatives where the excess of the totality of the area leased on June 9, 2025. is due to the acts of the lessee, the lessee shall be held solely liable therefor: Provided, further, That, in the case of corporations, associations, or partnerships. the president, manager, director, trustee, or officers responsible for the violation hereof shall bear the criminal liability. Secreta1J• General The penalties provided under this section shall House of Representatives likewise apply to all sublease contracts." SEC. 9. Implementing Rules and Regu.lations. - Within ninety (90) days from the effectivity of this Act, the Department of Trade and Industry (DTI), th.rough the BOI, and the Land Approved: :sEe. t 3 2025 Registration Authority (LRA), shall promulgate the necessary implementing rules and regulations for the effective implementation of this Act, in consultation with the FIRE and other concerned government agencies and stakeholders. SEC. 10. Separability Clause. - If any part or provision of this Act is declared invalid or unconstitutional, the other parts or provisions hereof not otherwise affected shall remain valid and effective. ") • MUALDEZ MARCOS JR. I Ill _I _____ A.AAAA ,: ,- ---=_-111 AA.AA.A. I El) (;f)J)~ ■ L ■ ■- ■ ._ ■ ■ . ■.A.a a 1 ii,nn 111 ff,iniiii iliiT111P88M009814 LENTINO-NAVA RIV