VOTING 175 against three with two abstentions, the House of Representatives on Tuesday approved House Bill (HB) No. 10755 on third and final reading to offer foreign investors a lease on private lands for 99 years, almost doubling the present term of 50 years.
Speaker Ferdinand Martin G. Romualdez, principal author of HB No. 10755, part of the
Legislative-Executive Development Advisory Council (LEDAC), said the proposed 99-year lease addresses the concern of foreign capitalists regarding the shorter rental period under the present law, which is 50 years renewal for an additional 25 years.
“We hope they would be satisfied with the proposal. We hope it would attract new foreign investments and encourage existing investors to expand their businesses, thereby creating more job and income opportunities for our people and sustaining our economic growth,” Speaker Romualdez said.
He said the proposal also aligns with the open-door policy of President Ferdinand R. Marcos Jr. for legitimate foreign capital and with existing practices in many countries in the region.
“We want to be competitive regionally and globally in terms of enticing foreign investments,” added the leader of the 300-plus-strong House.
Speaker Romualdez’s co-authors of the bill include Senior Deputy Speaker Aurelio “Dong” Gonzales Jr., Majority Leader Manuel Jose Dalipe, Senior Deputy Majority Leader and Ilocos Norte Rep. Ferdinand Alexander A. Marcos, Reps. Yedda K. Romualdez and Jude Acidre of Tingog Party-list, and scores of other House members.
HB 10755 provides that it is state policy to encourage foreign investments consistent with the constitutional mandate to conserve and develop the nation’s patrimony.
It declares that the state adopts a flexible and dynamic policy on the granting of long-term lease on private lands to foreign investors for the establishment of industrial estates, factories, assembly or processing plants, agro-industrial enterprises, land development for industrial or commercial use, tourism, agriculture, agroforestry, ecological conservation, and other similarly productive endeavors.
It also declares that it is state policy to ensure the reliability of investors’ lease contracts to guarantee stability and return of investment.
The bill added a new provision that defines the term “private lands.”
It shall mean “those lands which have been segregated from the general mass of the public domain and distributed by any form of gratuitous or onerous grant by the state, such as a deed of sale, adjustment title, special grant, or possessory information title
converted into a record of ownership.”
The definition “shall include patrimonial properties of the state owned, held, controlled, supervised, managed, or administered by investment promotion agencies as definite under Republic Act No. 11534, otherwise known as the Corporate Recovery and Incentives for Enterprises or CREATE Act.”
The proposed law provides that any foreign investor investing in the Philippines shall be allowed to lease private lands subject to the following conditions:
The lease period is 99 years.
2. The leases area shall be used solely for the purpose of the investment upon the mutual agreement of the parties.
3. The leased premises shall comprise such area as may reasonably be required for the purpose of the investment, subject to the Comprehensive Agrarian Reform Law and the Local Government Code.
4. The foreign investor has an approved and registered investment under Republic Act No. 7042, otherwise known as the Foreign Investments Act of 1991, as amended.
5. Lease agreements shall be subject to the approval of the Department of Trade and Industry-Board of Investments (DTI-BOI) except for lease of lands with economic zones or free port areas, which shall be subject to the approval of the relevant investment promotion agency (IPA) charged with the management and administration of said economic zones or free port areas.
6. The DTI-BOI or IPA concerned shall approve the a long-term lease contract provided the investor present proof of approved investment, duration of lease is certain, the exact location and metes and bounds of the leased property are identified and there is a provision in the contract for its termination for failure to start the investment project within three years from signing of the contract.
The lessee may be allowed to sublease the rented land with the consent of the lessor, unless there is a provision in the contract to the contrary.
The bill further provides that any lease contract that violates it shall be void from the beginning.
The contracting parties shall be punished with a fine of P1 million (up from P100,000) to P10 million (up from P1 million).
The BOI, in consultation with concerned agencies and stakeholders, shall issue implementing rules and regulations.
