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an foreigners own or have interests in Philippine condos?

Philippines, by virtue of the powers vested in me by the Constitution,


do hereby decree and order:
MALACAÑANG
Manila Title I
TITLE AND DEFINITIONS
PRESIDENTIAL DECREE No. 957 July 12, 1976
Section 1. Title. This Decree shall be known as THE SUBDIVISION
REGULATING THE SALE OF SUBDIVISION LOTS AND
AND CONDOMINIUM BUYERS' PROTECTIVE DECREE.
CONDOMINIUMS, PROVIDING PENALTIES FOR VIOLATIONS
THEREOF Section 2. Definition of Terms When used in this Decree, the
following terms shall, unless the context otherwise indicates, have
WHEREAS, it is the policy of the State to afford its inhabitants the
the following respective meanings:
requirements of decent human settlement and to provide them with
ample opportunities for improving their quality of life; (a) Person. "Person" shall mean a natural or a juridical
person. A juridical person refers to a business firm whether a
WHEREAS, numerous reports reveal that many real estate
corporation, partnership, cooperative or associations or a
subdivision owners, developers, operators, and/or sellers have
single proprietorship.
reneged on their representations and obligations to provide and
maintain properly subdivision roads, drainage, sewerage, water (b) Sale or sell. "Sale" or "sell" shall include every
systems, lighting systems, and other similar basic requirements, thus disposition, or attempt to dispose, for a valuable
endangering the health and safety of home and lot buyers; consideration, of a subdivision lot, including the building and
other improvements thereof, if any, in a subdivision project or
WHEREAS, reports of alarming magnitude also show cases of
a condominium unit in a condominium project. "Sale" and
swindling and fraudulent manipulations perpetrated by unscrupulous
"sell" shall also include a contract to sell, a contract of
subdivision and condominium sellers and operators, such as failure
purchase and sale, an exchange, an attempt to sell, an
to deliver titles to the buyers or titles free from liens and
option of sale or purchase, a solicitation of a sale, or an offer
encumbrances, and to pay real estate taxes, and fraudulent sales of
to sell, directly or by an agent, or by a circular, letter,
the same subdivision lots to different innocent purchasers for value;
advertisement or otherwise.
WHEREAS, these acts not only undermine the land and housing
A privilege given to a member of a cooperative, corporation,
program of the government but also defeat the objectives of the New
partnership, or any association and/or the issuance of a
Society, particularly the promotion of peace and order and the
certificate or receipt evidencing or giving the right of
enhancement of the economic, social and moral condition of the
participation in, or right to, any land in consideration of
Filipino people;
payment of the membership fee or dues, shall be deemed a
WHEREAS, this state of affairs has rendered it imperative that the sale within the meaning of this definition.
real estate subdivision and condominium businesses be closely
(c) Buy and purchase. The "buy" and "purchase" shall
supervised and regulated, and that penalties be imposed on
include any contract to buy, purchase, or otherwise acquire
fraudulent practices and manipulations committed in connection
for a valuable consideration a subdivision lot, including the
therewith.
building and other improvements, if any, in a subdivision
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the project or a condominium unit in a condominium project.
(d) Subdivision project. "Subdivision project" shall mean a commission or other compensation, undertakes to sell or
tract or a parcel of land registered under Act No. 496 which negotiate the sale of a real estate belonging to another.
is partitioned primarily for residential purposes into individual
lots with or without improvements thereon, and offered to the (m) Salesman. "Salesman" shall refer to the person regularly
public for sale, in cash or in installment terms. It shall include employed by a broker to perform, for and in his behalf, any
all residential, commercial, industrial and recreational areas or all functions of a real estate broker.
as well as open spaces and other community and public
areas in the project. (n) Authority. "Authority" shall mean the National Housing
Authority.
(e) Subdivision lot. "Subdivision lot" shall mean any of the
lots, whether residential, commercial, industrial, or Title II
recreational, in a subdivision project. REGISTRATION AND LICENSE TO SELL

(f) Complex subdivision plan. "Complex subdivision plan" Section 3. National Housing Authority The National Housing
shall mean a subdivision plan of a registered land wherein a Authority shall have exclusive jurisdiction to regulate the real estate
street, passageway or open space is delineated on the plan. trade and business in accordance with the provisions of this Decree.

(g) Condominium project. "Condominium project" shall mean Section 4. Registration of Projects The registered owner of a parcel
the entire parcel of real property divided or to be divided of land who wishes to convert the same into a subdivision project
primarily for residential purposes into condominium units, shall submit his subdivision plan to the Authority which shall act upon
including all structures thereon. and approve the same, upon a finding that the plan complies with the
Subdivision Standards' and Regulations enforceable at the time the
(h) Condominium unit. "Condominium unit" shall mean a part plan is submitted. The same procedure shall be followed in the case
of the condominium project intended for any type of of a plan for a condominium project except that, in addition, said
independent use or ownership, including one or more rooms Authority shall act upon and approve the plan with respect to the
or spaces located in one or more floors (or part of parts of building or buildings included in the condominium project in
floors) in a building or buildings and such accessories as accordance with the National Building Code (R.A. No. 6541).
may be appended thereto.
The subdivision plan, as so approved, shall then be submitted to the
(i) Owner. "Owner" shall refer to the registered owner of the Director of Lands for approval in accordance with the procedure
land subject of a subdivision or a condominium project. prescribed in Section 44 of the Land Registration Act (Act No. 496,
as amended by R.A. No. 440): Provided, that it case of complex
(j) Developer. "Developer" shall mean the person who subdivision plans, court approval shall no longer be required. The
develops or improves the subdivision project or condominium plan as likewise so approved, shall be submitted to the
condominium project for and in behalf of the owner thereof. Register of Deeds of the province or city in which the property lies
and the same shall be acted upon subject to the conditions and in
(k) Dealer. "Dealer" shall mean any person directly engaged accordance with the procedure prescribed in Section 4 of the
as principal in the business of buying, selling or exchanging Condominium Act (R.A. No. 4726).
real estate whether on a full-time or part-time basis.
The owner or the real estate dealer interested in the sale of lots or
(l) Broker. "Broker" shall mean any person who, for units, respectively, in such subdivision project or condominium
project shall register the project with the Authority by filing therewith a subdivision lot or condominium unit is mortgaged, it is
sworn registration statement containing the following information: sufficient if the instrument of mortgage contains a stipulation
that the mortgagee shall release the mortgage on any
(a) Name of the owner; subdivision lot or condominium unit as soon as the full
purchase price for the same is paid by the buyer.
(b) The location of the owner's principal business office, and
if the owner is a non-resident Filipino, the name and address The person filing the registration statement shall pay the registration
of his agent or representative in the Philippines is authorized fees prescribed therefor by the Authority.
to receive notice;
Thereupon, the Authority shall immediately cause to be published a
(c) The names and addresses of all the directors and officers notice of the filing of the registration statement at the expense of the
of the business firm, if the owner be a corporation, applicant-owner or dealer, in two newspapers general circulation,
association, trust, or other entity, and of all the partners, if it one published in English and another in Pilipino, once a week for two
be a partnership; consecutive weeks, reciting that a registration statement for the sale
of subdivision lots or condominium units has been filed in the
(d) The general character of the business actually transacted National Housing Authority; that the aforesaid registration statement,
or to be transacted by the owner; and as well as the papers attached thereto, are open to inspection during
business hours by interested parties, under such regulations as the
(e) A statement of the capitalization of the owner, including Authority may impose; and that copies thereof shall be furnished to
the authorized and outstanding amounts of its capital stock any party upon payment of the proper fees.
and the proportion thereof which is paid-up.
The subdivision project of the condominium project shall be deemed
The following documents shall be attached to the registration registered upon completion of the above publication requirement.
statement: The fact of such registration shall be evidenced by a registration
certificate to be issued to the applicant-owner or dealer.
(a) A copy of the subdivision plan or condominium plan as
approved in accordance with the first and second Section 5. License to sell. Such owner or dealer to whom has been
paragraphs of this section. issued a registration certificate shall not, however, be authorized to
sell any subdivision lot or condominium unit in the registered project
(b) A copy of any circular, prospectus, brochure,
unless he shall have first obtained a license to sell the project within
advertisement, letter, or communication to be used for the
two weeks from the registration of such project.
public offering of the subdivision lots or condominium units;
The Authority, upon proper application therefor, shall issue to such
(c) In case of a business firm, a balance sheet showing the
owner or dealer of a registered project a license to sell the project if,
amount and general character of its assets and liabilities and
after an examination of the registration statement filed by said owner
a copy of its articles of incorporation or articles of partnership
or dealer and all the pertinent documents attached thereto, he is
or association, as the case may be, with all the amendments
convinced that the owner or dealer is of good repute, that his
thereof and existing by-laws or instruments corresponding
business is financially stable, and that the proposed sale of the
thereto.
subdivision lots or condominium units to the public would not be
(d) A title to the property which is free from all liens and fraudulent.
encumbrances: Provided, however, that in case any
Section 6. Performance Bond. No license to sell subdivision lots or The suspension order may be lifted if, after notice and hearing, the
condominium units shall be issued by the Authority under Section 5 Authority is convinced that the registration statement is accurate or
of this Decree unless the owner or dealer shall have filed an that any deficiency therein has been corrected or supplemented or
adequate performance bond approved by said Authority to guarantee that the sale to the public of the subdivision or condominium project
the construction and maintenance of the roads, gutters, drainage, will neither be fraudulent not result in fraud. It shall also be lifted
sewerage, water system, lighting systems, and full development of upon dismissal of the complaint for lack of legal basis.
the subdivision project or the condominium project and the
compliance by the owner or dealer with the applicable laws and rules Until the final entry of an order of suspension, the suspension of the
and regulations. right to sell the project, though binding upon all persons notified
thereof, shall be deemed confidential unless it shall appear that the
The performance bond shall be executed in favor of the Republic of order of suspension has in the meantime been violated.
the Philippines and shall authorize the Authority to use the proceeds
thereof for the purposes of its undertaking in case of forfeiture as Section 9. Revocation of registration certificate and license to
provided in this Decree. sell. The Authority may, motu proprio or upon verified complaint filed
by a buyer of a subdivision lot or condominium unit, revoke the
Section 7. Exempt transactions. A license to sell and performance registration of any subdivision project or condominium project and
bond shall not be required in any of the following transactions: the license to sell any subdivision lot or condominium unit in said
project by issuing an order to this effect, with his findings in respect
(a) Sale of a subdivision lot resulting from the partition of thereto, if upon examination into the affairs of the owner or dealer
land among co-owners and co-heirs. during a hearing as provided for in Section 14 hereof, if shall appear
there is satisfactory evidence that the said owner or dealer:
(b) Sale or transfer of a subdivision lot by the original
purchaser thereof and any subsequent sale of the same lot. (a) Is insolvent; or

(c) Sale of a subdivision lot or a condominium unit by or for (b) has violated any of the provisions of this Decree or any
the account of a mortgagee in the ordinary course of applicable rule or regulation of the Authority, or any
business when necessary to liquidate a bona fide debt. undertaking of his/its performance bond; or

Section 8. Suspension of license to sell. Upon verified complaint by (c) Has been or is engaged or is about to engage in
a buyer of a subdivision lot or a condominium unit in any interested fraudulent transactions; or
party, the Authority may, in its discretion, immediately suspend the
owner's or dealer's license to sell pending investigation and hearing (d) Has made any misrepresentation in any prospectus,
of the case as provided in Section 13 hereof. brochure, circular or other literature about the subdivision
project or condominium project that has been distributed to
The Authority may motu proprio suspend the license to sell if, in its prospective buyers; or
opinion, any information in the registration statement filed by the
owner or dealer is or has become misleading, incorrect, inadequate (e) Is of bad business repute; or
or incomplete or the sale or offering for a sale of the subdivision or
condominium project may work or tend to work a fraud upon (f) Does not conduct his business in accordance with law or
prospective buyers. sound business principles.
Where the owner or dealer is a partnership or corporation or an said period shall be treated as original applications.
unincorporated association, it shall be sufficient cause for
cancellation of its registration certificate and its license to sell, if any The names and addresses of all persons registered as dealers,
member of such partnership or any officer or director of such brokers, or salesmen shall be recorded in a Register of Brokers,
corporation or association has been guilty of any act or omission Dealers and Salesmen kept in the Authority which shall be open to
which would be cause for refusing or revoking the registration of an public inspection.
individual dealer, broker or salesman as provided in Section 11
hereof. Section 12. Revocation of registration as dealers, brokers or
salesmen. Registration under the preceding section may be refused
Section 10. Registers of subdivision lots and condominium units. A or any registration granted thereunder, revoked by the Authority if,
record of subdivision lots and condominium units shall be kept in the after reasonable notice and hearing, it shall determine that such
Authority wherein shall be entered all orders of the Authority affecting applicant or registrant:
the condition or status thereof. The registers of subdivision lots and
condominium units shall be open to public inspection subject to such 1. Has violated any provision of this Decree or any rule or
reasonable rules as the Authority may prescribe. regulation made hereunder; or

Title III 2. Has made a material false statement in his application for
DEALERS, BROKERS AND SALESMEN registration; or

Section 11. Registration of dealers, brokers and salesmen. No real 3. Has been guilty of a fraudulent act in connection with any
estate dealer, broker or salesman shall engage in the business of sale of a subdivision lot or condominium unit; or
selling subdivision lots or condominium units unless he has
registered himself with the Authority in accordance with the 4. Has demonstrated his unworthiness to transact the
provisions of this section. business of dealer, broker, or salesman, as the case may be.

If the Authority shall find that the applicant is of good repute and has In case of charges against a salesman, notice thereof shall also be
complied with the applicable rules of the Authority, including the given the broker or dealer employing such salesman.
payment of the prescribed fee, he shall register such applicant as a
Pending hearing of the case, the Authority shall have the power to
dealer, broker or salesman upon filing a bond, or other security in lieu
order the suspension of the dealer's, broker's, of salesman's
thereof, in such sum as may be fixed by the Authority conditioned
registration; provided, that such order shall state the cause for the
upon his faithful compliance with the provisions of this Decree:
suspension.
Provided, that the registration of a salesman shall cease upon the
termination of his employment with a dealer or broker. The suspension or revocation of the registration of a dealer or broker
shall carry with it all the suspension or revocation of the registrations
Every registration under this section shall expire on the thirty-first day
of all his salesmen.
of December of each year. Renewal of registration for the
succeeding year shall be granted upon written application therefor Title IV
made not less than thirty nor more than sixty days before the first day PROCEDURE FOR REVOCATION OF REGISTRATION
of the ensuing year and upon payment of the prescribed fee, without CERTIFICATE
the necessity of filing further statements or information, unless
specifically required by the Authority. All applications filed beyond Section 13. Hearing. In the hearing for determining the existence of
any ground or grounds for the suspension and/or revocation of (b) Indirect contempt. The officer or officers designated to
registration certificate and license to sell as provided in Section 8 and hear the complaint may also adjudge any person in indirect
9 hereof, the following shall be complied with: contempt on grounds and in the manner prescribed in Rule
71 of the Revised Rules of Court.
(a) Notice. No such hearing shall proceed unless the
respondent is furnished with a copy of the complaint against Section 15. Decision. The case shall be decided within thirty (30)
him or is notified in writing of the purpose of such hearing. days from the time the same is submitted for decision. The Decision
may order the revocation of the registration of the subdivision or
(b) Venue. The hearing may be held before the officer or condominium project, the suspension, cancellation, or revocation of
officers designated by the Authority on the date and place the license to sell and/or forfeiture, in whole or in part, of the
specified in the notice. performance bond mentioned in Section 6 hereof. In case forfeiture
of the bond is ordered, the Decision may direct the provincial or city
(c) Nature of proceeding. The proceedings shall be non- engineer to undertake or cause the construction of roads and of
litigious and summary in nature without regard to legal other requirements for the subdivision or condominium as stipulated
technicalities obtaining in courts of law. The Rules of court in the bond, chargeable to the amount forfeited. Such decision shall
shall not apply in said hearing except by analogy or in a be immediately executory and shall become final after the lapse of
suppletory character and whenever practicable and 15 days from the date of receipt of the Decision.
convenient.
Section 16. Cease and Desist Order. Whenever it shall appear to
(d) Power incidental to the hearing. For the purpose of the the Authority that any person is engaged or about to engage in any
hearing or other proceeding under this Decree, the officer or act or practice which constitutes or will constitute a violation of the
officers designated to hear the complaint shall have the provisions of this Decree, or of any rule or regulation thereunder, it
power to administer oaths, subpoena witnesses, conduct may, upon due notice and hearing as provided in Section 13 hereof,
ocular inspections, take depositions, and require the issue a cease and desist order to enjoin such act or practices.
production of any book, paper, correspondence,
memorandum, or other record which are deemed relevant or Section 17. Registration. All contracts to sell, deeds of sale and
material to the inquiry. other similar instruments relative to the sale or conveyance of the
subdivision lots and condominium units, whether or not the purchase
Section 14. Contempt. price is paid in full, shall be registered by the seller in the Office of
the Register of Deeds of the province or city where the property is
(a) Direct contempt. The officer or officers designated by the situated.
Authority to hear the complaint may summarily adjudge in
direct contempt any person guilty of misbehavior in the Whenever a subdivision plan duly approved in accordance with
presence of or so near the said hearing officials as to Section 4 hereof, together with the corresponding owner's duplicate
obstruct or interrupt the proceedings before the same or of certificate of title, is presented to the Register of Deeds for
refusal to be sworn or to answer as a witness or to subscribe registration, the Register of Deeds shall register the same in
an affidavit or deposition when lawfully required to do so. accordance with the provisions of the Land Registration Act, as
The person found guilty of direct contempt under this section amended: Provided, however, that it there is a street, passageway or
shall be punished by a fine not exceeding Fifty (P50.00) required open space delineated on a complex subdivision plan
Pesos or imprisonment not exceeding five (5) days, or both. hereafter approved and as defined in this Decree, the Register of
Deeds shall annotate on the new certificate of title covering the
street, passageway or open space, a memorandum to the effect that or condominium plans, brochures, prospectus, printed matters,
except by way of donation in favor of a city or municipality, no portion letters or in any form of advertisement, within one year from the date
of any street, passageway, or open space so delineated on the plan of the issuance of the license for the subdivision or condominium
shall be closed or otherwise disposed of by the registered owner project or such other period of time as may be fixed by the Authority.
without the requisite approval as provided under Section 22 of this
Decree. Section 21. Sales Prior to Decree. In cases of subdivision lots or
condominium units sold or disposed of prior to the effectivity of this
Section 18. Mortgages. No mortgage on any unit or lot shall be Decree, it shall be incumbent upon the owner or developer of the
made by the owner or developer without prior written approval of the subdivision or condominium project to complete compliance with his
Authority. Such approval shall not be granted unless it is shown that or its obligations as provided in the preceding section within two
the proceeds of the mortgage loan shall be used for the development years from the date of this Decree unless otherwise extended by the
of the condominium or subdivision project and effective measures Authority or unless an adequate performance bond is filed in
have been provided to ensure such utilization. The loan value of accordance with Section 6 hereof.
each lot or unit covered by the mortgage shall be determined and the
buyer thereof, if any, shall be notified before the release of the loan. Failure of the owner or developer to comply with the obligations
The buyer may, at his option, pay his installment for the lot or unit under this and the preceding provisions shall constitute a violation
directly to the mortgagee who shall apply the payments to the punishable under Sections 38 and 39 of this Decree.
corresponding mortgage indebtedness secured by the particular lot
or unit being paid for, with a view to enabling said buyer to obtain title Section 22. Alteration of Plans. No owner or developer shall change
over the lot or unit promptly after full payment thereto; or alter the roads, open spaces, infrastructures, facilities for public
use and/or other form of subdivision development as contained in the
Section 19. Advertisements. Advertisements that may be made by approved subdivision plan and/or represented in its advertisements,
the owner or developer through newspaper, radio, television, leaflets, without the permission of the Authority and the written conformity or
circulars or any other form about the subdivision or the condominium consent of the duly organized homeowners association, or in the
or its operations or activities must reflect the real facts and must be absence of the latter, by the majority of the lot buyers in the
presented in such manner that will not tend to mislead or deceive the subdivision.
public.
Section 23. Non-Forfeiture of Payments. No installment payment
The owner or developer shall answerable and liable for the facilities, made by a buyer in a subdivision or condominium project for the lot
improvements, infrastructures or other forms of development or unit he contracted to buy shall be forfeited in favor of the owner or
represented or promised in brochures, advertisements and other developer when the buyer, after due notice to the owner or
sales propaganda disseminated by the owner or developer or his developer, desists from further payment due to the failure of the
agents and the same shall form part of the sales warranties owner or developer to develop the subdivision or condominium
enforceable against said owner or developer, jointly and severally. project according to the approved plans and within the time limit for
Failure to comply with these warranties shall also be punishable in complying with the same. Such buyer may, at his option, be
accordance with the penalties provided for in this Decree. reimbursed the total amount paid including amortization interests but
excluding delinquency interests, with interest thereon at the legal
Section 20. Time of Completion. Every owner or developer shall rate.
construct and provide the facilities, improvements, infrastructures
and other forms of development, including water supply and lighting Section 24. Failure to pay installments. The rights of the buyer in the
facilities, which are offered and indicated in the approved subdivision event of this failure to pay the installments due for reasons other than
the failure of the owner or developer to develop the project shall be a subdivision without access to any existing public road or street
governed by Republic Act No. 6552. must secure a right of way to a public road or street and such right of
way must be developed and maintained according to the requirement
Where the transaction or contract was entered into prior to the of the government and authorities concerned.
effectivity of Republic Act No. 6552 on August 26, 1972, the
defaulting buyer shall be entitled to the corresponding refund based Section 30. Organization of Homeowners Association. The owner or
on the installments paid after the effectivity of the law in the absence developer of a subdivision project or condominium project shall
of any provision in the contract to the contrary. initiate the organization of a homeowners association among the
buyers and residents of the projects for the purpose of promoting and
Section 25. Issuance of Title. The owner or developer shall deliver protecting their mutual interest and assist in their community
the title of the lot or unit to the buyer upon full payment of the lot or development.
unit. No fee, except those required for the registration of the deed of
sale in the Registry of Deeds, shall be collected for the issuance of Section 31. Donations of roads and open spaces to local
such title. In the event a mortgage over the lot or unit is outstanding government. The registered owner or developer of the subdivision or
at the time of the issuance of the title to the buyer, the owner or condominium project, upon completion of the development of said
developer shall redeem the mortgage or the corresponding portion project may, at his option, convey by way of donation the roads and
thereof within six months from such issuance in order that the title open spaces found within the project to the city or municipality
over any fully paid lot or unit may be secured and delivered to the wherein the project is located. Upon acceptance of the donation by
buyer in accordance herewith. the city or municipality concerned, no portion of the area donated
shall thereafter be converted to any other purpose or purposes
Section 26. Realty Tax. Real estate tax and assessment on a lot or unless after hearing, the proposed conversion is approved by the
unit shall de paid by the owner or developer without recourse to the Authority.
buyer for as long as the title has not passed the buyer; Provided,
however, that if the buyer has actually taken possession of and Section 32. Phases of Subdivision. For purposes of complying with
occupied the lot or unit, he shall be liable to the owner or developer the provisions of this Decree, the owner or developer may divide the
for such tax and assessment effective the year following such taking development and sale of the subdivision into phases, each phase to
of possession and occupancy. cover not less than ten hectares. The requirement imposed by this
Decree on the subdivision as a whole shall be deemed imposed on
Section 27. Other Charges. No owner or developer shall levy upon each phase.
any lot or buyer a fee for an alleged community benefit. Fees to
finance services for common comfort, security and sanitation may be Section 33. Nullity of waivers. Any condition, stipulation, or provision
collected only by a properly organized homeowners association and in contract of sale whereby any person waives compliance with any
only with the consent of a majority of the lot or unit buyers actually provision of this Decree or of any rule or regulation issued
residing in the subdivision or condominium project. thereunder shall be void.

Section 28. Access to Public Offices in the Subdivisions. No owner Section 34. Visitorial powers. This Authority, through its duly
or developer shall deny any person free access to any government authorized representative may, at any time, make an examination
office or public establishment located within the subdivision or which into the business affairs, administration, and condition of any person,
may be reached only by passing through the subdivision. corporation, partnership, cooperative, or association engaged in the
business of selling subdivision lots and condominium units. For this
Section 29. Right of Way to Public Road. The owner or developer of purpose, the official authorized so to do shall have the authority to
examine under oath the directors, officers, stockholders or members Fines shall be payable to the Authority and enforceable through writs
of any corporation, partnership, association, cooperative or other of execution in accordance with the provisions of the Rules of Court.
persons associated or connected with the business and to issue
subpoena or subpoena duces tecum in relation to any investigation Section 39. Penalties. Any person who shall violate any of the
that may arise therefrom. provisions of this Decree and/or any rule or regulation that may be
issued pursuant to this Decree shall, upon conviction, be punished
The Authority may also authorize the Provincial, City or Municipal by a fine of not more than twenty thousand (P20,000.00) pesos
Engineer, as the case may be, to conduct an ocular inspection of the and/or imprisonment of not more than ten years: Provided, That in
project to determine whether the development of said project the case of corporations, partnership, cooperatives, or associations,
conforms to the standards and specifications prescribed by the the President, Manager or Administrator or the person who has
government. charge of the administration of the business shall be criminally
responsible for any violation of this Decree and/or the rules and
The books, papers, letters, and other documents belonging to the regulations promulgated pursuant thereto.
person or entities herein mentioned shall be open to inspection by
the Authority or its duly authorized representative. Section 40. Liability of controlling persons. Every person who
directly or indirectly controls any person liable under any provision of
Section 35. Take-over Development. The Authority, may take over or this Decree or of any rule or regulation issued thereunder shall be
cause the development and completion of the subdivision or liable jointly and severally with and to the same extent as such
condominium project at the expenses of the owner or developer, controlled person unless the controlling person acted in good faith
jointly and severally, in cases where the owner or developer has and did not directly or indirectly induce the act or acts constituting the
refused or failed to develop or complete the development of the violation or cause of action.
project as provided for in this Decree.
Section 41. Other remedies. The rights and remedies provided in
The Authority may, after such take-over, demand, collect and receive this Decree shall be in addition to any and all other rights and
from the buyers the installment payments due on the lots, which shall remedies that may be available under existing laws.
be utilized for the development of the subdivision.
Section 42. Repealing clause. All laws, executive orders, rules and
Section 36. Rules and Regulations. The Authority shall issue the regulations or part thereof inconsistent with the provisions of this
necessary standards, rules and regulations for the effective Decree are hereby repealed or modified accordingly.
implementation of the provisions of this Decree. Such standards,
rules and regulations shall take effect immediately after their Section 43. Effectivity. This Decree shall take effect upon its
publication three times a week for two consecutive weeks in any approval.
newspaper of general circulation.
Done in the City of Manila, this 12th day of July, in the year of Our
Section 37. Deputization of law enforcement agencies. The Authority Lord, nineteen hundred and seventy-six.
may deputize the Philippine Constabulary or any law enforcement
agency in the execution of its final orders, rulings or decisions.

Section 38. Administrative Fines. The Authority may prescribe and


impose fines not exceeding ten thousand pesos for violations of the
provisions of this Decree or of any rule or regulation thereunder.
RA 4726
Sec. 1. The short title of this Act shall be "The Condominium Act". be divided into condominiums only if there shall be recorded in the
Register of Deeds of the province or city in which the property lies
Sec. 2. A condominium is an interest in real property consisting of and duly annotated in the corresponding certificate of title of the land,
separate interest in a unit in a residential, industrial or commercial if the latter had been patented or registered under either the Land
building and an undivided interest in common, directly or indirectly, in Registration or Cadastral Acts, an enabling or master deed which
the land on which it is located and in other common areas of the shall contain, among others, the following:
building. A condominium may include, in addition, a separate interest
in other portions of such real property. Title to the common areas, (a) Description of the land on which the building or buildings and
including the land, or the appurtenant interests in such areas, may be improvements are or are to be located;
held by a corporation specially formed for the purpose (hereinafter
known as the "condominium corporation") in which the holders of (b) Description of the building or buildings, stating the number of
separate interest shall automatically be members or shareholders, to stories and basements, the number of units and their accessories, if
the exclusion of others, in proportion to the appurtenant interest of any;
their respective units in the common areas.
(c) Description of the common areas and facilities;
The real right in condominium may be ownership or any other
interest in real property recognized by law, on property in the Civil (d) A statement of the exact nature of the interest acquired or to be
Code and other pertinent laws. acquired by the purchaser in the separate units and in the common
areas of the condominium project. Where title to or the appurtenant
Sec. 3. As used in this Act, unless the context otherwise requires: interests in the common areas is or is to be held by a condominium
corporation, a statement to this effect shall be included;
(a) "Condominium" means a condominium as defined in the next
preceding section. (e) Statement of the purposes for which the building or buildings and
each of the units are intended or restricted as to use;
(b) "Unit" means a part of the condominium project intended for any
type of independent use or ownership, including one or more rooms (f) A certificate of the registered owner of the property, if he is other
or spaces located in one or more floors (or part or parts of floors) in a than those executing the master deed, as well as of all registered
building or buildings and such accessories as may be appended holders of any lien or encumbrance on the property, that they
thereto. consent to the registration of the deed;

(c) "Project" means the entire parcel of real property divided or to be (g) The following plans shall be appended to the deed as integral
divided in condominiums, including all structures thereon, parts thereof:

(d) "Common areas" means the entire project excepting all units (1) A survey plan of the land included in the project, unless a survey
separately granted or held or reserved. plan of the same property had previously bee filed in said office;

(e) "To divide" real property means to divide the ownership thereof or (2) A diagrammatic floor plan of the building or buildings in the
other interest therein by conveying one or more condominiums project, in sufficient detail to identify each unit, its relative location
therein but less than the whole thereof. and approximate dimensions;

Sec. 4. The provisions of this Act shall apply to property divided or to (h) Any reasonable restriction not contrary to law, morals or public
policy regarding the right of any condominium owner to alienate or
dispose of his condominium. (b) There shall pass with the unit, as an appurtenance thereof, an
exclusive easement for the use of the air space encompassed by the
The enabling or master deed may be amended or revoked upon boundaries of the unit as it exists at any particular time and as the
registration of an instrument executed by the registered owner or unit may lawfully be altered or reconstructed from time to time. Such
owners of the property and consented to by all registered holders of easement shall be automatically terminated in any air space upon
any lien or encumbrance on the land or building or portion thereof. destruction of the unit as to render it untenantable.
The term "registered owner" shall include the registered owners of
condominiums in the project. Until registration of a revocation, the (c) Unless otherwise, provided, the common areas are held in
provisions of this Act shall continue to apply to such property. common by the holders of units, in equal shares, one for each unit.

Sec. 5. Any transfer or conveyance of a unit or an apartment, office (d) A non-exclusive easement for ingress, egress and support
or store or other space therein, shall include the transfer or through the common areas is appurtenant to each unit and the
conveyance of the undivided interests in the common areas or, in a common areas are subject to such easements.
proper case, the membership or shareholdings in the condominium
corporation: Provided, however, That where the common areas in (e) Each condominium owner shall have the exclusive right to paint,
the condominium project are owned by the owners of separate units repaint, tile, wax, paper or otherwise refinish and decorate the inner
as co-owners thereof, no condominium unit therein shall be surfaces of the walls, ceilings, floors, windows and doors bounding
conveyed or transferred to persons other than Filipino citizens, or his own unit.
corporations at least sixty percent of the capital stock of which
belong to Filipino citizens, except in cases of hereditary succession. (f) Each condominium owner shall have the exclusive right to
Where the common areas in a condominium project are held by a mortgage, pledge or encumber his condominium and to have the
corporation, no transfer or conveyance of a unit shall be valid if the same appraised independently of the other condominiums but any
concomitant transfer of the appurtenant membership or stockholding obligation incurred by such condominium owner is personal to him.
in the corporation will cause the alien interest in such corporation to
exceed the limits imposed by existing laws. (g) Each condominium owner has also the absolute right to sell or
dispose of his condominium unless the master deed contains a
Sec. 6. Unless otherwise expressly provided in the enabling or requirement that the property be first offered to the condominium
master deed or the declaration of restrictions, the incidents of a owners within a reasonable period of time before the same is offered
condominium grant are as follows: to outside parties;

(a) The boundary of the unit granted are the interior surfaces of the Sec. 7. Except as provided in the following section, the common
perimeter walls, floors, ceilings, windows and doors thereof. The areas shall remain undivided, and there shall be no judicial partition
following are not part of the unit bearing walls, columns, floors, roofs, thereof.
foundations and other common structural elements of the building;
lobbies, stairways, hallways, and other areas of common use, Sec. 8. Where several persons own condominiums in a condominium
elevator equipment and shafts, central heating, central refrigeration project, an action may be brought by one or more such persons for
and central air-conditioning equipment, reservoirs, tanks, pumps and partition thereof by sale of the entire project, as if the owners of all of
other central services and facilities, pipes, ducts, flues, chutes, the condominiums in such project were co-owners of the entire
conduits, wires and other utility installations, wherever located, project in the same proportion as their interests in the common
except the outlets thereof when located within the unit. areas:Provided, however, That a partition shall be made only upon a
showing:
(a) That three years after damage or destruction to the project which condominium corporation, an association of the condominium
renders material part thereof unit for its use prior thereto, the project owners, a board of governors elected by condominium owners, or a
has not been rebuilt or repaired substantially to its state prior to its management agent elected by the owners or by the board named in
damage or destruction, or the declaration. It shall also provide for voting majorities quorums,
notices, meeting date, and other rules governing such body or
(b) That damage or destruction to the project has rendered one-half bodies.
or more of the units therein untenantable and that condominium
owners holding in aggregate more than thirty percent interest in the Such declaration of restrictions, among other things, may also
common areas are opposed to repair or restoration of the project; or provide:

(c) That the project has been in existence in excess of fifty years, (a) As to any such management body;
that it is obsolete and uneconomic, and that condominium owners
holding in aggregate more than fifty percent interest in the common (1) For the powers thereof, including power to enforce the provisions
areas are opposed to repair or restoration or remodeling or of the declarations of restrictions;
modernizing of the project; or
(2) For maintenance of insurance policies, insuring condominium
(d) That the project or a material part thereof has been condemned owners against loss by fire, casualty, liability, workmen's
or expropriated and that the project is no longer viable, or that the compensation and other insurable risks, and for bonding of the
condominium owners holding in aggregate more than seventy members of any management body;
percent interest in the common areas are opposed to continuation of
the condominium regime after expropriation or condemnation of a (3) Provisions for maintenance, utility, gardening and other services
material portion thereof; or benefiting the common areas, for the employment of personnel
necessary for the operation of the building, and legal, accounting and
(e) That the conditions for such partition by sale set forth in the other professional and technical services;
declaration of restrictions, duly registered in accordance with the
terms of this Act, have been met. (4) For purchase of materials, supplies and the like needed by the
common areas;
Sec. 9. The owner of a project shall, prior to the conveyance of any
condominium therein, register a declaration of restrictions relating to (5) For payment of taxes and special assessments which would be a
such project, which restrictions shall constitute a lien upon each lien upon the entire project or common areas, and for discharge of
condominium in the project, and shall insure to and bind all any lien or encumbrance levied against the entire project or the
condominium owners in the project. Such liens, unless otherwise common areas;
provided, may be enforced by any condominium owner in the project
or by the management body of such project. The Register of Deeds (6) For reconstruction of any portion or portions of any damage to or
shall enter and annotate the declaration of restrictions upon the destruction of the project;
certificate of title covering the land included within the project, if the
(7) The manner for delegation of its powers;
land is patented or registered under the Land Registration or
Cadastral Acts. (8) For entry by its officers and agents into any unit when necessary
in connection with the maintenance or construction for which such
The declaration of restrictions shall provide for the management of
body is responsible;
the project by anyone of the following management bodies: a
(9) For a power of attorney to the management body to sell the entire a condominium corporation, regardless of whether it is a stock or
project for the benefit of all of the owners thereof when partition of non-stock corporation, shall not be transferable separately from the
the project may be authorized under Section 8 of this Act, which said condominium unit of which it is an appurtenance. When a member or
power shall be binding upon all of the condominium owners stockholder ceases to own a unit in the project in which the
regardless of whether they assume the obligations of the restrictions condominium corporation owns or holds the common areas, he shall
or not. automatically cease to be a member or stockholder of the
condominium corporation.
(b) The manner and procedure for amending such
restrictions: Provided, That the vote of not less than a majority in Sec. 11. The term of a condominium corporation shall be co-terminus
interest of the owners is obtained. with the duration of the condominium project, the provisions of the
Corporation Law to the contrary notwithstanding.
(c) For independent audit of the accounts of the management body;
Sec. 12. In case of involuntary dissolution of a condominium
(d) For reasonable assessments to meet authorized expenditures, corporation for any of the causes provided by law, the common areas
each condominium unit to be assessed separately for its share of owned or held by the corporation shall, by way of liquidation, be
such expenses in proportion (unless otherwise provided) to its transferred pro-indiviso and in proportion to their interest in the
owners fractional interest in any common areas; corporation to the members or stockholders thereof, subject to the
superior rights of the corporation creditors. Such transfer or
(e) For the subordination of the liens securing such assessments to conveyance shall be deemed to be a full liquidation of the interest of
other liens either generally or specifically described; such members or stockholders in the corporation. After such transfer
or conveyance, the provisions of this Act governing undivided co-
(f) For conditions, other than those provided for in Sections eight and ownership of, or undivided interest in, the common areas in
thirteen of this Act, upon which partition of the project and dissolution condominium projects shall fully apply.
of the condominium corporation may be made. Such right to partition
or dissolution may be conditioned upon failure of the condominium Sec. 13. Until the enabling or the master deed of the project in which
owners to rebuild within a certain period or upon specified the condominium corporation owns or holds the common area is
inadequacy of insurance proceeds, or upon specified percentage of revoked, the corporation shall not be voluntarily dissolved through an
damage to the building, or upon a decision of an arbitrator, or upon action for dissolution under Rule 104 of the Rules of Court except
any other reasonable condition. upon a showing:
Sec. 10. Whenever the common areas in a condominium project are (a) That three years after damage or destruction to the project in
held by a condominium corporation, such corporation shall constitute which the corporation owns or holds the common areas, which
the management body of the project. The corporate purposes of damage or destruction renders a material part thereof unfit for its use
such a corporation shall be limited to the holding of the common prior thereto, the project has not been rebuilt or repaired substantially
areas, either in ownership or any other interest in real property to its state prior to its damage or destruction; or
recognized by law, to the management of the project, and to such
other purposes as may be necessary, incidental or convenient to the (b) That damage or destruction to the project has rendered one-half
accomplishment of said purposes. The articles of incorporation or by- or more of the units therein untenantable and that more than thirty
laws of the corporation shall not contain any provision contrary to or percent of the members of the corporation, if non-stock, or the
inconsistent with the provisions of this Act, the enabling or master shareholders representing more than thirty percent of the capital
deed, or the declaration of restrictions of the project. Membership in stock entitled to vote, if a stock corporation, are opposed to the repair
or reconstruction of the project, or the affirmative vote of all the stockholders or members.

(c) That the project has been in existence in excess of fifty years, Sec. 17. Any provision of the Corporation Law to the contrary
that it is obsolete and uneconomical, and that more than fifty percent notwithstanding, the by-laws of a condominium corporation shall
of the members of the corporation, if non-stock, or the stockholders provide that a stockholder or member shall not be entitled to demand
representing more than fifty percent of the capital stock entitled to payment of his shares or interest in those cases where such right is
vote, if a stock corporation, are opposed to the repair or restoration granted under the Corporation Law unless he consents to sell his
or remodeling or modernizing of the project; or separate interest in the project to the corporation or to any purchaser
of the corporation's choice who shall also buy from the corporation
(d) That the project or a material part thereof has been condemned the dissenting member or stockholder's interest. In case of
or expropriated and that the project is no longer viable, or that the disagreement as to price, the procedure set forth in the appropriate
members holding in aggregate more than seventy percent interest in provision of the Corporation Law for valuation of shares shall be
the corporation, if non-stock, or the stockholders representing more followed. The corporation shall have two years within which to pay
than seventy percent of the capital stock entitled to vote, if a stock for the shares or furnish a purchaser of its choice from the time of
corporation, are opposed to the continuation of the condominium award. All expenses incurred in the liquidation of the interest of the
regime after expropriation or condemnation of a material portion dissenting member or stockholder shall be borne by him.
thereof; or
Sec. 18. Upon registration of an instrument conveying a
(e) That the conditions for such a dissolution set forth in the condominium, the Register of Deeds shall, upon payment of the
declaration of restrictions of the project in which the corporation owns proper fees, enter and annotate the conveyance on the certificate of
of holds the common areas, have been met. title covering the land included within the project and the transferee
shall be entitled to the issuance of a "condominium owner's" copy of
Sec. 14. The condominium corporation may also be dissolved by the the pertinent portion of such certificate of title. Said "condominium
affirmative vote of all the stockholders or members thereof at a owner's" copy need not reproduce the ownership status or series of
general or special meeting duly called for the purpose: Provided, transactions in force or annotated with respect to other
That all the requirements of Section sixty-two of the Corporation Law condominiums in the project. A copy of the description of the land, a
are complied with. brief description of the condominium conveyed, name and personal
circumstances of the condominium owner would be sufficient for
Sec. 15. Unless otherwise provided for in the declaration of purposes of the "condominium owner's" copy of the certificate of title.
restrictions upon voluntary dissolution of a condominium corporation No conveyance of condominiums or part thereof, subsequent to the
in accordance with the provisions of Sections thirteen and fourteen of original conveyance thereof from the owner of the project, shall be
this Act, the corporation shall be deemed to hold a power of attorney registered unless accompanied by a certificate of the management
from all the members or stockholders to sell and dispose of their body of the project that such conveyance is in accordance with the
separate interests in the project and liquidation of the corporation provisions of the declaration of restrictions of such project.
shall be effected by a sale of the entire project as if the corporation
owned the whole thereof, subject to the rights of the corporate and of In cases of condominium projects registered under the provisions of
individual condominium creditors. the Spanish Mortgage Law or Act 3344, as amended, the registration
of the deed of conveyance of a condominium shall be sufficient if the
Sec. 16. A condominium corporation shall not, during its existence, Register of Deeds shall keep the original or signed copy thereof,
sell, exchange, lease or otherwise dispose of the common areas together with the certificate of the management body of the project,
owned or held by it in the condominium project unless authorized by and return a copy of the deed of conveyance to the condominium
owner duly acknowledge and stamped by the Register of Deeds in of redemption as in cases of judicial or extra-judicial foreclosure of
the same manner as in the case of registration of conveyances of mortgages.
real property under said laws.
Sec. 21. No labor performed or services or materials furnished with
Sec. 19. Where the enabling or master deed provides that the land the consent of or at the request of a condominium owner or his agent
included within a condominium project are to be owned in common or his contractor or subcontractor, shall be the basis of a lien against
by the condominium owners therein, the Register of Deeds may, at the condominium of any other condominium owner, unless such
the request of all the condominium owners and upon surrender of all other owners have expressly consented to or requested the
their "condominium owner's" copies, cancel the certificates of title of performance of such labor or furnishing of such materials or services.
the property and issue a new one in the name of said condominium Such express consent shall be deemed to have been given by the
owners as pro-indiviso co-owners thereof. owner of any condominium in the case of emergency repairs of his
condominium unit. Labor performed or services or materials
Sec. 20. An assessment upon any condominium made in accordance furnished for the common areas, if duly authorized by the
with a duly registered declaration of restrictions shall be an obligation management body provided for in a declaration of restrictions
of the owner thereof at the time the assessment is made. The governing the property, shall be deemed to be performed or
amount of any such assessment plus any other charges thereon, furnished with the express consent of each condominium owner. The
such as interest, costs (including attorney's fees) and penalties, as owner of any condominium may remove his condominium from a lien
such may be provided for in the declaration of restrictions, shall be against two or more condominiums or any part thereof by payment to
and become a lien upon the condominium assessed when the the holder of the lien of the fraction of the total sum secured by such
management body causes a notice of assessment to be registered lien which is attributable to his condominium unit.
with the Register of Deeds of the city or province where such
condominium project is located. The notice shall state the amount of Sec. 22. Unless otherwise provided for by the declaration of
such assessment and such other charges thereon a may be restrictions, the management body, provided for herein, may acquire
authorized by the declaration of restrictions, a description of the and hold, for the benefit of the condominium owners, tangible and
condominium, unit against which same has been assessed, and the intangible personal property and may dispose of the same by sale or
name of the registered owner thereof. Such notice shall be signed by otherwise; and the beneficial interest in such personal property shall
an authorized representative of the management body or as be owned by the condominium owners in the same proportion as
otherwise provided in the declaration of restrictions. Upon payment their respective interests in the common areas. A transfer of a
of said assessment and charges or other satisfaction thereof, the condominium shall transfer to the transferee ownership of the
management body shall cause to be registered a release of the lien. transferor's beneficial interest in such personal property.

Such lien shall be superior to all other liens registered subsequent to Sec. 23. Where, in an action for partition of a condominium project or
the registration of said notice of assessment except real property tax for the dissolution of condominium corporation on the ground that the
liens and except that the declaration of restrictions may provide for project or a material part thereof has been condemned or
the subordination thereof to any other liens and encumbrances. expropriated, the Court finds that the conditions provided for in this
Act or in the declaration of restrictions have not been met, the Court
Such liens may be enforced in the same manner provided for by law may decree a reorganization of the project, declaring which portion
for the judicial or extra-judicial foreclosure of mortgages of real or portions of the project shall continue as a condominium project,
property. Unless otherwise provided for in the declaration of the owners thereof, and the respective rights of said remaining
restrictions, the management body shall have power to bid at owners and the just compensation, if any, that a condominium owner
foreclosure sale. The condominium owner shall have the same right may be entitled to due to deprivation of his property. Upon receipt of
a copy of the decree, the Register of Deeds shall enter and annotate either residential or commercial use, simple majority
the same on the pertinent certificate of title. shall be on per unit of ownership basis and that in the
case of mixed use, simple majority shall be on floor area
Sec. 24. Any deed, declaration or plan for a condominium project of ownership basis: Provided further, That prior
shall be liberally construed to facilitate the operation of the project, notifications to all registered owners are done, and
and its provisions shall be presumed to be independent and Provided, finally, That any amendment or revocation
severable. already decided by a simple majority of all
registered owners shall be submitted to the Housing and
Sec. 25. Whenever real property has been divided into Land Use Regulatory Board and the city/municipal
condominiums, each condominium separately owned shall be
engineer for approval before it can be registered. Until
separately assessed, for purposes of real property taxation and other
registration of a revocation, the provision of this Act shall
tax purposes to the owners thereof and the tax on each such
continue to apply to such property."
condominium shall constitute a lien solely thereon.
Sec. 2. Sec. 16 of the same Act is hereby amended to
Sec. 26. All Acts or parts of Acts in conflict or inconsistent with this read as follows:cralaw
Act are hereby amended insofar as condominium and its incidents "Sec. 16. A condominium corporation shall not, during
are concerned. its existence, sell, exchange,lease or otherwise dispose of
the common areas owned or held by it in the
Sec. 27. This Act shall take effect upon its approval. condominium project unless authorized by the
affirmative vote of a simple majority of the registered
Approved: June 18, 1966 owners: Provided, That prior notifications to all
REPUBLIC ACT NO. 7899 registered owners are done: and, Provided, further, That
the condominium corporation may expand or integrate
AN ACT AMENDING SECTION FOUR AND SECTION the project with another upon the affirmative vote of a
SIXTEEN OF REPUBLIC ACT NUMBERED FOUR simple majority of the registered owners, subject only to
THOUSAND SEVEN HUNDRED TWENTY-SIX, OTHERWISE the final approval of the Housing and Land Use
KNOWN AS "THE CONDOMINIUM ACT." Regulatory Board."
Sec. 3. Effectivity. - This Act shall take effect fifteen (15)
Be it enacted by the Senate and the House of days after its complete publication in at least two
Representatives of the Philippines in Congress (2) national newspapers of general circulation.
assembled:

Section 1. Sec. 4, last paragraph of Republic Act No. 4726 Approved:


is hereby amended as follows;
"Sec. 4. xxx (SGD.) EDGARDO J. ANGARA
President of the Senate
"The enabling or master deed may be amended or
revoked upon registration of an instrument executed by a
simple majority of the registered owners of the property: (SGD.) JOSE DE VENECIA, JR.
Provided, That in a condominium project exclusively for Speaker of the House of Representatives
This Act which is a consolidation of House Bill No.
12384 and Senate Bill No. 2042 was finally passed by the
House of Representatives and the Senate on February 15,
1995.

(SGD.) EDGARDO E. TUMANGAN


Secretary of the Senate

(SGD.) CAMILO L. SABIO


Secretary General
House of Representatives

Approved: February 23, 1995