By Junex Doronio
MANILA – The House of Representatives on Tuesday (December 17, 2024) approved House Bill (HB) No. 10755 on third and final reading, granting foreign investors the option to lease private lands for 99 years. This is nearly double the current term of 50 years, with a 25-year renewal period.
Speaker Ferdinand Martin G. Romualdez, the principal author of HB No. 10755 and a member of the Legislative-Executive Development Advisory Council (LEDAC), stated that the proposed 99-year lease addresses concerns from foreign investors about the short rental period under the existing law. The current law allows for a 50-year lease with a 25-year extension.
“We hope they will be satisfied with this proposal. Our goal is to attract new foreign investments and encourage existing investors to expand their businesses, thereby creating more jobs and income opportunities for our people, and sustaining our economic growth,” Speaker Romualdez said.
He emphasized that the proposal aligns with President Ferdinand R. Marcos Jr.’s open-door policy for legitimate foreign capital and mirrors practices in many countries in the region.
“We want to be competitive both regionally and globally in terms of attracting foreign investments,” added Romualdez, who leads the 300-plus members of the House.
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 numerous other House members.
HB 10755 supports state policy encouraging foreign investments in line with the constitutional mandate to conserve and develop the nation’s patrimony.
The bill establishes a flexible and dynamic policy for granting long-term leases on private lands to foreign investors for a variety of uses, including industrial estates, factories, agro-industrial enterprises, tourism, agriculture, and ecological conservation, among others.
It also aims to ensure the stability and reliability of investors’ lease contracts, guaranteeing a return on investment.
The bill introduces a new provision defining “private lands” as lands segregated from the public domain, distributed through grants like deeds of sale or special titles, and includes patrimonial properties managed by investment promotion agencies as defined under the Corporate Recovery and Incentives for Enterprises (CREATE) Act (Republic Act No. 11534).
Under the proposed law, foreign investors in the Philippines can lease private lands under the following conditions:
The lease period is 99 years.
The leased area must be used solely for the agreed investment purposes.
The leased premises must encompass an area reasonably required for the investment, subject to the Comprehensive Agrarian Reform Law and the Local Government Code.
The foreign investor must have an approved and registered investment under the Foreign Investments Act of 1991 (Republic Act No. 7042), as amended.
Lease agreements must be approved by the Department of Trade and Industry-Board of Investments (DTI-BOI), except for lands in economic zones or free port areas, which require approval from the relevant investment promotion agency (IPA).
The DTI-BOI or IPA will approve the lease contract if the investor presents proof of an approved investment, identifies the location and boundaries of the leased property, and includes a provision for termination if the investment project does not start within three years of signing the contract.
The bill also allows lessees to sublease the land with the lessor’s consent, unless otherwise stated in the contract.
Any lease contract violating these provisions will be considered void from the beginning. Contracting parties will be fined between P1 million (up from P100,000) and P10 million (up from P1 million).
The Board of Investments (BOI), in consultation with concerned agencies and stakeholders, will issue implementing rules and regulations.
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