AGRARIAN LAW AND SOCIAL LEGISLATION REVIEWER

I. CONSTITUTIONAL PROVISIONS

ARTICLE II
DECLARATION OF PRINCIPLES AND STATE POLICIES PRINCIPLES
SECTION 9. The State shall promote a just and dynamic social order that will ensure the
prosperity and independence of the nation and free the people from poverty through policies
that provide adequate social services, promote full employment, a rising standard of living, and
an improved quality of life for all.

SECTION 10. The State shall promote social justice in all phases of national development.

SECTION 17. The State shall give priority to education, science and technology, arts, culture,
and sports to foster patriotism and nationalism, accelerate social progress, and promote total
human liberation and development.

SECTION 21. The State shall promote comprehensive rural development and agrarian reform.

ARTICLE III
BILL OF RIGHTS
SECTION 1. No person shall be deprived of life, liberty, or property without due process of law,
nor shall any person be denied the equal protection of the laws.

SECTION 9. Private property shall not be taken for public use without just compensation.

SECTION 10. No law impairing the obligation of contracts shall be passed.

ARTICLE XII
National Economy and Patrimony
SECTION 10. The Congress shall, upon recommendation of the economic and planning
agency, when the national interest dictates, reserve to citizens of the Philippines or to
corporations or associations at least sixty per centum of whose capital is owned by such
citizens, or such higher percentage as Congress may prescribe, certain areas of investments.
The Congress shall enact measures that will encourage the formation and operation of
enterprises whose capital is wholly owned by Filipinos.

In the grant of rights, privileges, and concessions covering the national economy and patrimony,
the State shall give preference to qualified Filipinos.

The State shall regulate and exercise authority over foreign investments within its national
jurisdiction and in accordance with its national goals and priorities.

ARTICLE XIII
Social Justice and Human Rights
SECTION 1. The Congress shall give highest priority to the enactment of measures that protect
and enhance the right of all the people to human dignity, reduce social, economic, and political
inequalities, and remove cultural inequities by equitably diffusing wealth and political power for
the common good.
To this end, the State shall regulate the acquisition, ownership, use, and disposition of property
and its increments.

SECTION 2. The promotion of social justice shall include the commitment to create economic
opportunities based on freedom of initiative and self-reliance.

SECTION 4. The State shall, by law, undertake an agrarian reform program founded on the
right of farmers and regular farmworkers, who are landless, to own directly or collectively the
lands they till or, in the case of other farmworkers, to receive a just share of the fruits thereof. To
this end, the State shall encourage and undertake the just distribution of all agricultural lands,
subject to such priorities and reasonable retention limits as the Congress may prescribe, taking
into account ecological, developmental, or equity considerations, and subject to the payment of
just compensation. In determining retention limits, the State shall respect the right of small
landowners. The State shall further provide incentives for voluntary land-sharing.

SECTION 5. The State shall recognize the right of farmers, farmworkers, and landowners, as
well as cooperatives, and other independent farmers’ organizations to participate in the
planning, organization, and management of the program, and shall provide support to
agriculture through appropriate technology and research, and adequate financial, production,
marketing, and other support services.

SECTION 6. The State shall apply the principles of agrarian reform or stewardship, whenever
applicable in accordance with law, in the disposition or utilization of other natural resources,
including lands of the public domain under lease or concession suitable to agriculture, subject to
prior rights, homestead rights of small settlers, and the rights of indigenous communities to their
ancestral lands.
The State may resettle landless farmers and farmworkers in its own agricultural estates which
shall be distributed to them in the manner provided by law.

SECTION 7. The State shall protect the rights of subsistence fishermen, especially of local
communities, to the preferential use of local marine and fishing resources, both inland and
offshore. It shall provide support to such fishermen through appropriate technology and
research, adequate financial, production, and marketing assistance, and other services. The
State shall also protect, develop, and conserve such resources. The protection shall extend to
offshore fishing grounds of subsistence fishermen against foreign intrusion. Fishworkers shall
receive a just share from their labor in the utilization of marine and fishing resources.

SECTION 8. The State shall provide incentives to landowners to invest the proceeds of the
agrarian reform program to promote industrialization, employment creation, and privatization of
public sector enterprises. Financial instruments used as payment for their lands shall be
honored as equity in enterprises of their choice.

REPUBLIC ACT NO. 6657

SECTION 3. Definitions. – For the purpose of this Act, unless the context indicates otherwise:

(a) Agrarian Reform means the redistribution of lands, regardless of crops or fruits produced to
farmers and regular farmworkers who are landless, irrespective of tenurial arrangement, to
include the totality of factors and support services designed to lift the economic status of the
beneficiaries and all other arrangements alternative to the physical redistribution of lands, such
as production or profit-sharing, labor administration, and the distribution of shares of stocks,
which will allow beneficiaries to receive a just share of the fruits of the lands they work.

(b) Agriculture, Agricultural Enterprise or Agricultural Activity means the cultivation of the
soil, planting of crops, growing of fruit trees, raising of livestock, poultry or fish, including the
harvesting of such farm products, and other farm activities and practices performed by a farmer
in conjunction with such farming operations done by persons whether natural or juridical.

(c) Agricultural Land refers to land devoted to agricultural activity as defined in this Act and not
classified as mineral, forest, residential, commercial or industrial land.

(d) Agrarian Dispute refers to any controversy relating to tenurial arrangements, whether
leasehold, tenancy, stewardship or otherwise, over lands devoted to agriculture, including
disputes concerning farmworkers’ associations or representation of persons in negotiating,
fixing, maintaining, changing, or seeking to arrange terms or conditions of such tenurial
arrangements.

It includes any controversy relating to compensation of lands acquired under this Act and other
terms and conditions of transfer of ownership from landowners to farmworkers, tenants and
other agrarian reform beneficiaries, whether the disputants stand in the proximate relation of
farm operator and beneficiary, landowner and tenant, or lessor and lessee.

(e) Idle or Abandoned Land refers to any agricultural land not cultivated, tilled or developed to
produce any crop nor devoted to any specific economic purpose continuously for a period of
three (3) years immediately prior to the receipt of notice of acquisition by the government as
provided under this Act, but does not include land that has become permanently or regularly
devoted to non-agricultural purposes. It does not include land which has become unproductive
by reason of force majeure or any other fortuitous event, provided that prior to such event, such
land was previously used for agricultural or other economic purpose.

(f) Farmer refers to a natural person whose primary livelihood is cultivation of land or the
production of agricultural crops, either by himself, or primarily with the assistance of his
immediate farm household, whether the land is owned by him, or by another person under a
leasehold or share tenancy agreement or arrangement with the owner thereof.

(g) Farmworker is a natural person who renders services for value as an employee or laborer in
an agricultural enterprise or farm regardless of whether his compensation is paid on a daily,
weekly, monthly or “pakyaw” basis. The term includes an individual whose work has ceased as
a consequence of, or in connection with, a pending agrarian dispute and who has not obtained a
substantially equivalent and regular farm employment.

(h) Regular Farmworker is a natural person who is employed on a permanent basis by an

agricultural enterprise or farm.

(i) Seasonal Farmworker is a natural person who is employed on a recurrent, periodic or

intermittent basis by an agricultural enterprise or farm, whether as a permanent or a non-
permanent laborer, such as “dumaan”, “sacada”, and the like.

(j) Other Farmworker is a farmworker who does not fall under paragraphs (g), (h) and (i).
(k) Cooperatives shall refer to organizations composed primarily of small agricultural
producers, farmers, farmworkers, or other agrarian reform beneficiaries who voluntarily organize
themselves for the purpose of pooling land, human, technological, financial or other economic
resources, and operated on the principle of one member, one vote. A juridical person may be a
member of a cooperative, with the same rights and duties as a natural person.

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II. HISTORICAL LEGAL EVOLUTION OF AGRARIAN LAW

Pre-Spanish Period

“This land is Ours God gave this land to us”

Before the Spaniards came to the Philippines, Filipinos lived in villages or barangays ruled by
chiefs or datus. The datus comprised the nobility. Then came the maharlikas (freemen),
followed by the aliping mamamahay (serfs) and aliping saguiguilid (slaves).

However, despite the existence of different classes in the social structure, practically everyone
had access to the fruits of the soil. Money was unknown, and rice served as the medium of
exchange.

Spanish Period

“United we stand, divided we fall”

When the Spaniards came to the Philippines, the concept of encomienda (Royal Land Grants)
was introduced. This system grants that Encomienderos must defend his encomienda from
external attack, maintain peace and order within, and support the missionaries. In turn, the
encomiendero acquired the right to collect tribute from the indios (native).

The system, however, degenerated into abuse of power by the encomienderos The tribute soon
became land rents to a few powerful landlords. And the natives who once cultivated the lands in
freedom were transformed into mere share tenants.

First Philippine Republic

“The yoke has finally broken”

When the First Philippine Republic was established in 1899, Gen. Emilio Aguinaldo declared in
the Malolos Constitution his intention to confiscate large estates, especially the so-called Friar
lands.

However, as the Republic was short-lived, Aguinaldo’s plan was never implemented.

American Period

“Long live America”

Significant legislation enacted during the American Period:

• Philippine Bill of 1902 – Set the ceilings on the hectarage of private individuals and
corporations may acquire: 16 has. for private individuals and 1,024 has. for corporations.
• Land Registration Act of 1902 (Act No. 496) – Provided for a comprehensive registration
of land titles under the Torrens system.
• Public Land Act of 1903 – introduced the homestead system in the Philippines.
• Tenancy Act of 1933 (Act No. 4054 and 4113) – regulated relationships between
landowners and tenants of rice (50-50 sharing) and sugar cane lands.

The Torrens system, which the Americans instituted for the registration of lands, did not solve
the problem completely. Either they were not aware of the law or if they did, they could not pay
the survey cost and other fees required in applying for a Torrens title.

Commonwealth Period

“Government for the Filipinos”

President Manuel L. Quezon espoused the "Social Justice" program to arrest the increasing
social unrest in Central Luzon.

Significant legislation enacted during Commonwealth Period:

• 1935 Constitution – "The promotion of social justice to ensure the well-being and
economic security of all people should be the concern of the State"
• Commonwealth Act No. 178 (An Amendment to Rice Tenancy Act No. 4045), Nov. 13,
1936 – Provided for certain controls in the landlord-tenant relationships
• National Rice and Corn Corporation (NARIC), 1936 – Established the price of rice and
corn thereby help the poor tenants as well as consumers.
• Commonwealth Act. No. 461, 1937 – Specified reasons for the dismissal of tenants and
only with the approval of the Tenancy Division of the Department of Justice.
• Rural Program Administration, created March 2, 1939 – Provided the purchase and
lease of haciendas and their sale and lease to the tenants.
Commonwealth Act No. 441 enacted on June 3, 1939 – Created the National Settlement
Administration with a capital stock of P20,000,000.

Japanese Occupation

“The Era of Hukbalahap”

The Second World War II started in Europe in 1939 and in the Pacific in 1941.

Hukbalahap controlled whole areas of Central Luzon; landlords who supported the Japanese
lost their lands to peasants while those who supported the Huks earned fixed rentals in favor of
the tenants.

Unfortunately, the end of war also signaled the end of gains acquired by the peasants.
Upon the arrival of the Japanese in the Philippines in 1942, peasants and workers organizations
grew strength. Many peasants took up arms and identified themselves with the anti-Japanese
group, the HUKBALAHAP (Hukbo ng Bayan Laban sa Hapon).

Philippine Republic

“The New Republic”

After the establishment of the Philippine Independence in 1946, the problems of land tenure
remained. These became worst in certain areas. Thus the Congress of the Philippines revised
the tenancy law.

President Manuel A. Roxas (1946-1948) enacted the following laws:

• Republic Act No. 34 -- Established the 70-30 sharing arrangements and regulating
share-tenancy contracts.
• Republic Act No. 55 -- Provided for a more effective safeguard against arbitrary
ejectment of tenants.

Elpidio R. Quirino (1948-1953) enacted the following law:

Executive Order No. 355 issued on October 23, 1950 -- Replaced the National Land Settlement
Administration with Land Settlement Development Corporation (LASEDECO) which takes over
the responsibilities of the Agricultural Machinery Equipment Corporation and the Rice and Corn
Production Administration.

Ramon Magsaysay (1953-1957) enacted the following laws:

• Republic Act No. 1160 of 1954 -- Abolished the LASEDECO and established the
National Resettlement and Rehabilitation Administration (NARRA) to resettle dissidents
and landless farmers. It was particularly aimed at rebel returnees providing home lots
and farmlands in Palawan and Mindanao.
• Republic Act No. 1199 (Agricultural Tenancy Act of 1954) -- governed the relationship
between landowners and tenant farmers by organizing share-tenancy and leasehold
system. The law provided the security of tenure of tenants. It also created the Court of
Agrarian Relations.
• Republic Act No. 1400 (Land Reform Act of 1955) -- Created the Land Tenure
Administration (LTA) which was responsible for the acquisition and distribution of large
tenanted rice and corn lands over 200 hectares for individuals and 600 hectares for
corporations.
• Republic Act No. 821 (Creation of Agricultural Credit Cooperative Financing
Administration) -- Provided small farmers and share tenants loans with low interest rates
of six to eight percent.

President Carlos P. Garcia (1957-1961)

Continued the program of President Ramon Magsaysay. No new legislation passed.

President Diosdado P. Macapagal (1961-1965) enacted the following law:

Republic Act No. 3844 of August 8, 1963 (Agricultural Land Reform Code) -- Abolished share
tenancy, institutionalized leasehold, set retention limit at 75 hectares, invested rights of
preemption and redemption for tenant farmers, provided for an administrative machinery for
implementation, institutionalized a judicial system of agrarian cases, incorporated extension,
marketing and supervised credit system of services of farmer beneficiaries.

The RA was hailed as one that would emancipate Filipino farmers from the bondage of tenancy.

President Ferdinand E. Marcos (1965-1986)

Proclamation No. 1081 on September 21, 1972 ushered the Period of the New Society. Five
days after the proclamation of Martial Law, the entire country was proclaimed a land reform area
and simultaneously the Agrarian Reform Program was decreed.

President Marcos enacted the following laws:

• Republic Act No. 6389, (Code of Agrarian Reform) and RA No. 6390 of 1971 -- Created
the Department of Agrarian Reform and the Agrarian Reform Special Account Fund. It
strengthen the position of farmers and expanded the scope of agrarian reform.
• Presidential Decree No. 2, September 26, 1972 -- Declared the country under land
reform program. It enjoined all agencies and offices of the government to extend full
cooperation and assistance to the DAR. It also activated the Agrarian Reform
Coordinating Council.
• Presidential Decree No. 27, October 21, 1972 -- Restricted land reform scope to
tenanted rice and corn lands and set the retention limit at 7 hectares.

President Corazon C. Aquino (1986-1992)

The Constitution ratified by the Filipino people during the administration of President Corazon C.
Aquino provides under Section 21 under Article II that “The State shall promote comprehensive
rural development and agrarian reform.”

On June 10, 1988, former President Corazon C. Aquino signed into law Republic Act No. 6657
or otherwise known as the Comprehensive Agrarian Reform Law (CARL). The law became
effective on June 15, 1988.

Subsequently, four Presidential issuances were released in July 1987 after 48 nationwide
consultations before the actual law was enacted.

President Corazon C. Aquino enacted the following laws:

• Executive Order No. 228, July 16, 1987 – Declared full ownership to qualified farmer-
beneficiaries covered by PD 27. It also determined the value remaining unvalued rice
and corn lands subject of PD 27 and provided for the manner of payment by the FBs and
mode of compensation to landowners.
• Executive Order No. 229, July 22, 1987 – Provided mechanism for the implementation of
the Comprehensive Agrarian Reform Program (CARP).
• Proclamation No. 131, July 22, 1987 – Instituted the CARP as a major program of the
government. It provided for a special fund known as the Agrarian Reform Fund (ARF),
 with an initial amount of Php50 billion to cover the estimated cost of the program from
1987-1992.
• Executive Order No. 129-A, July 26, 1987 – streamlined and expanded the power and
operations of the DAR.
• Republic Act No. 6657, June 10, 1988 (Comprehensive Agrarian Reform Law) – An act
which became effective June 15, 1988 and instituted a comprehensive agrarian reform
program to promote social justice and industrialization providing the mechanism for its
implementation and for other purposes. This law is still the one being implemented at
present.
• Executive Order No. 405, June 14, 1990 – Vested in the Land Bank of the Philippines
the responsibility to determine land valuation and compensation for all lands covered by
CARP.
• Executive Order No. 407, June 14, 1990 – Accelerated the acquisition and distribution of
agricultural lands, pasture lands, fishponds, agro-forestry lands and other lands of the
public domain suitable for agriculture.

President Fidel V. Ramos (1992-1998)

When President Fidel V. Ramos formally took over in 1992, his administration came face to face
with publics who have lost confidence in the agrarian reform program. His administration
committed to the vision “Fairer, faster and more meaningful implementation of the Agrarian
Reform Program.

President Fidel V. Ramos enacted the following laws:

• Republic Act No. 7881, 1995 – Amended certain provisions of RA 6657 and exempted
fishponds and prawns from the coverage of CARP.
• Republic Act No. 7905, 1995 – Strengthened the implementation of the CARP.
• Executive Order No. 363, 1997 – Limits the type of lands that may be converted by
setting conditions under which limits the type of lands that may be converted by setting
conditions under which specific categories of agricultural land are either absolutely non-
negotiable for conversion or highly restricted for conversion.
• Republic Act No. 8435, 1997 (Agriculture and Fisheries Modernization Act AFMA) –
Plugged the legal loopholes in land use conversion.
• Republic Act 8532, 1998 (Agrarian Reform Fund Bill) – Provided an additional Php50
billion for CARP and extended its implementation for another 10 years.

President Joseph E. Estrada (1998-2000)

“ERAP PARA SA MAHIRAP’. This was the battle cry that endeared President Joseph Estrada
and made him very popular during the 1998 presidential election.

President Joseph E. Estrada initiated the enactment of the following law:

Executive Order N0. 151, September 1999 (Farmer’s Trust Fund) – Allowed the voluntary
consolidation of small farm operation into medium and large scale integrated enterprise that can
access long-term capital.
During his administration, President Estrada launched the Magkabalikat Para sa Kaunlarang
Agraryo or MAGKASAKA. The DAR forged into joint ventures with private investors into
agrarian sector to make FBs competitive.

However, the Estrada Administration was short lived. The masses who put him into office
demanded for his ouster.

President Gloria Macapacal-Arroyo (2000-2010)

The agrarian reform program under the Arroyo administration is anchored on the vision “To
make the countryside economically viable for the Filipino family by building partnership and
promoting social equity and new economic opportunities towards lasting peace and sustainable
rural development.”

Land Tenure Improvement - DAR will remain vigorous in implementing land acquisition and
distribution component of CARP. The DAR will improve land tenure system through land
distribution and leasehold.

Provision of Support Services - CARP not only involves the distribution of lands but also
included package of support services which includes: credit assistance, extension services,
irrigation facilities, roads and bridges, marketing facilities and training and technical support
programs.

Infrastrucre Projects - DAR will transform the agrarian reform communities (ARCs), an area
focused and integrated delivery of support services, into rural economic zones that will help in
the creation of job opportunities in the countryside.

KALAHI ARZone - The KALAHI Agrarian Reform (KAR) Zones were also launched. These
zones consists of one or more municipalities with concentration of ARC population to achieve
greater agro-productivity.

Agrarian Justice - To help clear the backlog of agrarian cases, DAR will hire more paralegal
officers to support undermanned adjudicatory boards and introduce quota system to compel
adjudicators to work faster on agrarian reform cases. DAR will respect the rights of both farmers
and landowners.

President Benigno Aquino III (2010-2016)

President Benigno Aquino III vowed during his 2012 State of the Nation Address that he would
complete before the end of his term the Comprehensive Agrarian Reform Program (CARP), the
centerpiece program of the administration of his mother, President Corazon Aquino.

The younger Aquino distributed their family-owned Hacienda Luisita in Tarlac. Apart from the
said farm lots, he also promised to complete the distribution of privately-owned lands of
productive agricultural estates in the country that have escaped the coverage of the program.

Under his administration, the Agrarian Reform Community Connectivity and Economic Support
Services (ARCCESS) project was created to contribute to the overall goal of rural poverty
reduction especially in agrarian reform areas.
Agrarian Production Credit Program (APCP) provided credit support for crop production to
newly organized and existing agrarian reform beneficiaries’ organizations (ARBOs) and farmers’
organizations not qualified to avail themselves of loans under the regular credit windows of
banks.

The legal case monitoring system (LCMS), a web-based legal system for recording and
monitoring various kinds of agrarian cases at the provincial, regional and central offices of the
DAR to ensure faster resolution and close monitoring of agrarian-related cases, was also
launched.

Aside from these initiatives, Aquino also enacted Executive Order No. 26, Series of 2011, to
mandate the Department of Agriculture-Department of Environment and Natural Resources-
Department of Agrarian Reform Convergence Initiative to develop a National Greening Program
in cooperation with other government agencies.

President Rodrigo Roa Duterte (2016 – present)

Under his leadership, the President wants to pursue an “aggressive” land reform program that
would help alleviate the life of poor Filipino farmers by prioritizing the provision of support
services alongside land distribution.

The President directed the DAR to launch the 2nd phase of agrarian reform where landless
farmers would be awarded with undistributed lands under the Comprehensive Agrarian Reform
Program (CARP).

Duterte plans to place almost all public lands, including military reserves, under agrarian reform.

The President also placed 400 hectares of agricultural lands in Boracay under CARP.

Under his administration the DAR created an anti-corruption task force to investigate and handle
reports on alleged anomalous activities by officials and employees of the department.

The Department also pursues an “Oplan Zero Backlog” in the resolution of cases in relation to
agrarian justice delivery of the agrarian reform program to fast-track the implementation of
CARP.

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III. EXEMPTIONS / EXCLUSIONS

1. Lands ADE used for parks, wildlife, forest reserves, reforestation, fish sanctuaries
and breeding grounds, watershed and mangroves.
2. Private lands ADE used for prawn farms and fish ponds.
3. Lands ADE used and found to be necessary for:
a. National defense;
b. School sites and campuses
c. Seeds and seedling research
d. Church sites and convents
e. Mosque sites and Islamic center
f. Communial burial grounds and cemeteries
g. Penal colonies and penal farms actually worked by the inmates
 h. Government and private research and quarantine facilities
4. All lands not developed for agriculture with 18% slope and over;
5. Agricultural lands devoted for commercial, livestock, poultry and swine raising

SECTION 10. Exemptions and Exclusions. – Lands actually, directly and exclusively used
and found to be necessary for parks, wildlife, forest reserves, reforestation, fish sanctuaries and
breeding grounds, watersheds, and mangroves, national defense, school sites and campuses
including experimental farm stations operated by public or private schools for educational
purposes, seeds and seedlings research and pilot production centers, church sites and
convents appurtenant thereto, mosque sites and Islamic centers appurtenant thereto, communal
burial grounds and cemeteries, penal colonies and penal farms actually worked by the inmates,
government and private research and quarantine centers and all lands with eighteen percent
(18%) slope and over, except those already developed shall be exempt from the coverage of
this Act.

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IV. SUBORDINATE LEGISLATION

It is the authority delegated by the law-making body to the administrative body to adopt
rules and regulations intended to carry out the provisions of a law and implement
legislative policy

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V. JUST COMPENSATION
It is the full and fair equivalent of the property taken from its owner by the expropriator.
The measure is not the taker’s gain, but the owner’s loss. The payment must be “prompt
and full”

Compensation

SECTION 17. Determination of Just Compensation. – In determining just compensation, the

cost of acquisition of the land, the current value of like properties, its nature, actual use and
income, the sworn valuation by the owner, the tax declarations, and the assessment made by
government assessors shall be considered. The social and economic benefits contributed by
the farmers and the farmworkers and by the Government to the property as well as the non-
payment of taxes or loans secured from any government financing institution on the said land
shall be considered as additional factors to determine its valuation.

SECTION 18. Valuation and Mode of Compensation. – The LBP shall compensate the
landowner in such amounts as may be agreed upon by the landowner and the DAR and the
LBP, in accordance with the criteria provided for in Sections 16 and 17 and other pertinent
provisions hereof, or as may be finally determined by the court, as the just compensation for the
land.

The compensation shall be paid in one of the following modes, at the option of the landowner:

(1) Cash payment, under the following terms and conditions;

(a) For lands above – Twenty-five percent
fifty (50) hectares, insofar (25%) cash, the balance to
as the excess hectarage is be paid in government
concerned. financial instruments
negotiable at any time.
(b) For lands above – Thirty percent (30%) cash,
twenty-four (24) hectares the balance to be paid in
and up to fifty (50) hectares. government financial
instruments negotiable
at any time.
(c) For lands twenty-four – Thirty-five percent (35%)
(24) hectares and below. cash, the balance to be paid
in government financial
instruments negotiable at
any time.

(2) Shares of stock in government-owned or controlled corporations, LBP preferred shares,

physical assets or other qualified investments in accordance with guidelines set by the PARC;

(3) Tax credits which can be used against any tax liability;

(4) LBP bonds, which shall have the following features:

(a) Market interest rates aligned with 91-day treasury bill rates. Ten percent (10%) of the face
value of the bonds shall mature every year from the date of issuance until the tenth (10th) year:
Provided, That should the landowner choose to forego the cash portion, whether in full or in
part, he shall be paid correspondingly in LBP bonds;

(b) Transferability and negotiability. Such LBP bonds may be used by the landowner, his
successors in interest or his assigns, up to the amount of their face value, for any of the
following:

(i) Acquisition of land or other real properties of the government, including assets under the
Asset Privatization Program and other assets foreclosed by government financial institutions in
the same province or region where the lands for which the bonds were paid are situated;

(ii) Acquisition of shares of stock of government-owned or controlled corporations or shares of

stocks owned by the government in private corporations;

(iii) Substitution for surety or bail bonds for the provisional release of accused persons, or
performance bonds;

(iv) Security for loans with any government financial institution, provided the proceeds of the
loans shall be invested in an economic enterprise, preferably in a small- and medium-scale
industry, in the same province or region as the land for which the bonds are paid;

(v) Payment for various taxes and fees to government; Provided, That the use of these bonds
for these purposes will be limited to a certain percentage of the outstanding balance of the
financial instruments: Provided, further, That the PARC shall determine the percentage
mentioned above;

(vi) Payment for tuition fees of the immediate family of the original bondholder in government
universities, colleges, trade schools, and other institutions;

(vii) Payment for fees of the immediate family of the original bondholder in government
hospitals; and

(viii) Such other uses as the PARC may from time to time allow.

In case of extraordinary inflation, the PARC shall take appropriate measures to protect the
economy.

SECTION 19. Incentives for Voluntary Offers for Sale. – Landowners, other than banks and
other financial institutions, who voluntarily offer their lands for sale shall be entitled to an
additional five percent (5%) cash payment.

SECTION 20. Voluntary Land Transfer. – Landowners of agricultural lands subject to acquisition
under this Act may enter into a voluntary arrangement for direct transfer of their lands to
qualified beneficiaries subject to the following guidelines:

(a) All notices for voluntary land transfer must be submitted to the DAR within the first year of
the implementation of the CARP. Negotiations between the landowners and qualified
beneficiaries covering any voluntary land transfer which remain unresolved after one (1) year
shall not be recognized and such land shall instead be acquired by the government and
transferred pursuant to this Act.

(b) The terms and conditions of such transfer shall not be less favorable to the transferee than
those of the government’s standing offer to purchase from the landowner and to resell to the
beneficiaries, if such offers have been made and are fully known to both parties.

(c) The voluntary agreement shall include sanctions for non-compliance by either party and shall
be duly recorded and its implementation monitored by the DAR.

SECTION 21. Payment of Compensation by Beneficiaries Under Voluntary Land Transfer. –

Direct payments in cash or in kind may be made by the farmer-beneficiary to the landowner
under terms to be mutually agreed upon by both parties, which shall be binding upon them,
upon registration with and approval by the DAR. Said approval shall be considered given,
unless notice of disapproval is received by the farmer-beneficiary within thirty (30) days from the
date of registration.

In the event they cannot agree on the price of land, the procedure for compulsory acquisition as
provided in Section 16 shall apply. The LBP shall extend financing to the beneficiaries for
purposes of acquiring the land .

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VI. COMPULSORY ACQUISITION PROCESS
The mandatory acquisition of agricultural lands including facilities and improvements
necessary for agricultural production, as may be appropriate, for distribution to qualified
beneficiaries upon payment of just compensation.

Land Acquisition

SECTION 16. Procedure for Acquisition of Private Lands. – For purposes of acquisition of
private lands, the following procedures shall be followed:

(a) After having identified the land, the landowners and the beneficiaries, the DAR shall send its
notice to acquire the land to the owners thereof, by personal delivery or registered mail, and
post the same in a conspicuous place in the municipal building and barangay hall of the place
where the property is located. Said notice shall contain the offer of the DAR to pay a
corresponding value in accordance with the valuation set forth in Sections 17, 18, and other
pertinent provisions hereof.

(b) Within thirty (30) days from the date of receipt of written notice by personal delivery or
registered mail, the landowner, his administrator or representative shall inform the DAR of his
acceptance or rejection of the offer.

(c) If the landowner accepts the offer of the DAR, the Land Bank of the Philippines (LBP) shall
pay the landowner the purchase price of the land within thirty (30) days after he executes and
delivers a deed of transfer in favor of the Government and surrenders the Certificate of Title and
other monuments of title.

(d) In case of rejection or failure to reply, the DAR shall conduct summary administrative
proceedings to determine the compensation for the land by requiring the landowner, the LBP
and other interested parties to submit evidence as to the just compensation for the land, within
fifteen (15) days from the receipt of the notice. After the expiration of the above period, the
matter is deemed submitted for decision. The DAR shall decide the case within thirty (30) days
after it is submitted for decision.

(e) Upon receipt by the landowner of the corresponding payment or, in case of rejection or no
response from the landowner, upon the deposit with an accessible bank designated by the DAR
of the compensation in cash or in LBP bonds in accordance with this Act, the DAR shall take
immediate possession of the land and shall request the proper Register of Deeds to issue a
Transfer Certificate of Title (TCT) in the name of the Republic of the Philippines. The DAR shall
thereafter proceed with the redistribution of the land to the qualified beneficiaries.

(f) Any party who disagrees with the decision may bring the matter to the court of proper
jurisdiction for final determination of just compensation.

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VII. ECONOMIC SIZE FAMILY FARM

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VIII. RA 1199 ON TENANCY RELATIONSHIP

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IX. DIFFERENCE BETWEEN SC RULINGS CENTRAL MINDANAO VS. DARAB; DAR VS.
DECS

CMU VS. DARAB

The land involved was not alienable and disposable land of the public domain
because it was reserved by the late President Carlos P. Garcia under
Proclamation No. 476 for the use of Mindanao Agricultural College (now CMU) for
scientific and technological research in the field of agriculture. The land was
actually, directly and exclusively used and found to be necessary for school sites
and campuses and future educational needs of the CMU.

By the nature of the CMU, which is a school established to promote agriculture

and industry, the need for a vast tract of agricultural land for future programs of
expansion is obvious. The lands by their character have become inalienable from
the moment President Garcia dedicated them for CMU's use in scientific and
technological research in the field of agriculture. They have ceased to be
alienable public lands.

DAR VS. DECS

The lands in this case were not actually and exclusively utilized as school sites
and campuses, as they were leased to Anglo Agricultural Corporation, not for
educational purposes but for the furtherance of its business. It was the income
from the contract of lease and not the subject lands that was directly used for
the repairs and renovations of the schools in the locality.

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X. PRIMARY JURISDICTION
DOCTRINE OF PRIMARY JURISDICTION – means that the court cannot and will not
resolve controversy involving question which is within the jurisdiction of an administrative
tribunal, especially where the questions demands the exercise of sound administrative
discretion requiring special knowledge, experience and services of the administrative
tribunal to determine technical and intricate matters of fact

The doctrine of primary jurisdiction does not warrant a court to arrogate unto itself the
authority to resolve a controversy, the jurisdiction over which is initially lodge with an
administrative body of special competence