THE COMPREHENSIVE AGRARIAN REFORM LAW

Republic Act No. 6657, as amended

I. Introduction

A. Constitutional Basis

1. Article II, Section 21: The State shall promote comprehensive rural development and agrarian re-
form.

2. Article XII, Section 1: x x x The State shall promote industrialization and full employment based on
sound agricultural development and agrarian reform, x x x

3. Article XIII, Section 3: x x x The State shall regulate the relations between workers and employers,
recognizing the right of labor to its just share in the fruits of production and the right of enterprises
to reasonable returns on investments, and to expansion and growth.

4. Article XIII, Section 4: The State shall, by law, undertake an agrarian reform program founded on the
rights 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.

5. Article XIII, Section 5: The State shall recognize the rights 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.

6. Article XIII, 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 re sourc-
es, including lands of the public domain under lease or concession suitable to agriculture, sub ject 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 agriculture estates which
shall be distributed to them in the manner provided by law.

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

B. Declaration of Principles and Policies [Section 2]

It is the policy of the State to pursue a Comprehensive Agrarian Reform Program (CARP). The welfare
of the landless farmers and farmworkers will receive the highest consideration to promote social justice
and to move the nation toward sound rural development and industrialization, and the establishment of
owner cultivatorship of economic-size farms as the basis of Philippine agriculture.

The State shall promote industrialization and full employment based on sound agricultural
development and agrarian reform, through industries that make full and efficient use of human and
natural resources, and which are competitive in both domestic and foreign markets: Provided, That the
conversion of agricultural lands into industrial, commercial or residential lands shall take into account,
tillers' rights and national food security. Further, the State shall protect Filipino enterprises against unfair
foreign competition and trade practices.

The State recognizes that there is not enough agricultural land to be divided and distributed to each
farmer and regular farmworker so that each one can own his/her economic-size family farm. This being
the case, a meaningful agrarian reform program to uplift the lives and economic status of the farmer and
his/her children can only be achieved through simultaneous industrialization aimed at developing a
self-reliant and independent national economy effectively controlled by Filipinos.

To this end, the State may, in the interest of national welfare or defense, establish and operate vital
industries.

A more equitable distribution and ownership of land, with due regard to the rights of landowners to
just compensation, retention rights under Section 6 of Republic Act No. 6657, as amended, and to the
ecological needs of the nation, shall be undertaken to provide farmers and farmworkers with the
opportunity to enhance their dignity and improve the quality of their lives through greater productivity
of agricultural lands.

The agrarian reform program is 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 the priorities and retention limits set forth in this Act, taking into
account ecological, developmental, and equity considerations, and subject to the payment of just
compensation. The State shall respect the right of small landowners, and shall provide incentive for
voluntary land-sharing.

As much as practicable, the implementation of the program shall be community-based to assure,

among others, that the farmers shall have greater control of farmgate prices, and easier access to credit.

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.

The State shall recognize and enforce, consistent with existing laws, the rights of rural women to own
and control land, taking into consideration the substantive equality between men and women as qualified
beneficiaries, to receive a just share of the fruits thereof, and to be represented in advisory or
appropriate decision-making bodies. These rights shall be independent of their male relatives and of
their civil status.

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 farm workers in its own agricultural estates, which shall
 be distributed to them in the manner provided by law.

By means of appropriate incentives, the State shall encourage the formation and maintenance of
economic-size family farms to be constituted by individual beneficiaries and small landowners.
The State shall protect the rights of subsistence fishermen, especially of local communities, to the
preferential use of communal 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.

The State shall be guided by the principles that land has a social function and land ownership has a
social responsibility. Owners of agricultural land have the obligation to cultivate directly or through labor
administration the lands they own and thereby make the land productive.

The State shall provide incentives to landowners to invest the proceeds of the agrarian reform
program to promote industrialization, employment and privatization of public sector enterprises.
Financial instruments used as payment for lands shall contain features that shall enhance negotiability
and acceptability in the marketplace.

The State may lease undeveloped lands of the public domain to qualified entities for the
development of capital-intensive farms, and traditional and pioneering crops especially those for exports
subject to the prior rights of the beneficiaries under this Act.

C. Definition of Agrarian Reform

1. 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 total-
ity of factors and support services designed to lift the economic status of the benefi ciaries and all
other arrangement alternative to the physical redistribution of lands, such as production or profit-
sharing, labor administration, and the distribution of stock, which will allow beneficiaries to receive a
just share of the fruits of the lands they work. [Section 3(a) of RA 6657]

2. Distinguished from Land Reform

* Land Reform is the physical redistribution of land such as the program under Presidential Decree
No. 27. Agrarian reform means the redistribution of lands including the totality of factors and
support services designed to lift the economic status of the beneficiaries. Thus, agrarian reform
is broader than land reform.

D. RA 6657 is Constitutional

In the case of Association of Small Landowners in the Philippines, Inc. v. Secretary of Agrarian
Reform,1 the Supreme Court held:

1 175 SCRA 343.

 "The case before us presents no knotty complication insofar as the question of compensable taking is
concerned. To the extent that the measures under challenge merely prescribe retention limits for
landowners, there is an exercise of the police power for the regulation of private property in accor dance
with the Constitution. But where, to carry out such regulation, it becomes necessary to deprive such
owners of whatever lands they may own in excess of the maximum area allowed, there is definitely a
taking under the power of eminent domain for which payment of just compensation is imperative. The
taking contemplated is not a mere limitation of the use of the land. What is required is the surrender of
the title to and the physical possession of the said excess and all beneficial rights accru ing to the owner in
favor of the farmer-beneficiary. This is definitely an exercise not of the police power but of the power of
eminent domain.

"Classification has been defined as the grouping of persons or things similar to each other in certain
particulars and different from each other in these same particulars. To be valid, it must conform to the
following requirements: (1) it must be based on substantial distinctions; (2) it must be germane to the
purpose of the law; (3) it must not be limited to existing conditions only; and (4) it must apply equally to
all the members of the class. The Court finds that all these requisites have been met by the measures
here challenged as arbitrary and discriminatory.

"Equal protection simply means that all persons or things similarly situated must be treated alike
both as to the rights conferred and the liabilities imposed. The petitioner have not shown that they
belong to a different class and entitled to a different treatment. The argument that not only landowners
but also owners of other properties must be made to share the burden of implementing land reform
must be rejected. There is a substantial distinction between these two classes of owners that is clearly
visible except to those who will not see. There is no need to elaborate on this matter. In any event, the
Congress is allowed a wide leeway in providing for a valid classification. Its decision is accorded
recognition and respect by the courts of justice except only where its discretion is abused to the detri-
ment of the Bill of Rights.

"It is worth remarking at this juncture that a statute may be sustained under the police power only if
there is a concurrence of the lawful subject and the lawful method. Put otherwise, the interests of the
public generally as distinguished from those of a particular class require the interference of the State and,
no less important, the means employed are reasonably necessary for the attainment of the purpose
sought to be achieved and not unduly oppressive upon individuals. As the subject and purpose of
agrarian reform have been laid down by the Constitution itself, we may say that the first requirement has
been satisfied. What remains to be examined is the validity of the method employed to achieve the
Constitutional goal.

"Eminent domain is an inherent power of the State that enable it to forcibly acquire private lands
intended for public use upon payment of just compensation to the owner. Obviously, there is no need to
expropriate where the owner is willing to sell under terms also acceptable to the purchaser, in which case
an ordinary deed of sale may be agreed upon by the parties. It is only where the owner is unwilling to
sell, or cannot accept the price or other conditions offered by the vendee, that the power of eminent
domain will come into play to assert the paramount authority of the State over the interest of the
property owner. Private rights must then yield to the irresistible demands of the public interest on the
time-honored justification, as in the case of the police power, that the welfare of the people is the
supreme law.

"But for all its primacy and urgency, the power of expropriation is by no means absolute (as indeed
no power is absolute). The limitation is found in the constitutional injunction that "private property shall
not be taken for public use without just compensation" and in the abundant jurisprudence that has
evolved from the interpretation of this principle. Basically, the requirements for a proper exercise of the
 power are: (1) public use and (2) just compensation.

"[T]he determination of just compensation is a function addressed to the courts of justice and may
not be usurped by any other branch or official of the government. EPZA v. Dulay resolved a challenge to
several decrees promulgated by President Marcos providing that the just compensation for property
under expropriation should be either the assessment of the property by the government or the sworn
valuation thereof by the owner, whichever was lower.

"With these assumptions, the Court hereby declares that the content and manner of the just
compensation provided for in the afore-quoted Section 18 of the CARP Law is not viola tive of the
Constitution. We do not mind admitting that a certain degree of pragmatism has influenced our decision
on this issue, but after all this Court is not a cloistered institution removed from the realities and
demands of society or oblivious to the need for its enhancement. The Court is as acutely anxious as the
rest of our people to see the goal of agrarian reform achieved at last after the frustrations and
deprivations of our peasant masses during all these disappointing decades. We are aware that
invalidation of said section will result in the nullification of the entire program, killing the farmer's hopes
even as they approach realization and resurrecting the specter of discontent and dissent in the restless
countryside. That is not in our view the intention of the Constitution, and that is not what we shall
decree today.

"Accepting the theory that payment of the just compensation is not always required to be made fully
in money, we find further that the proportion of cash payment to the other things of value constituting
the total payment, as determined on the basis of the areas of the lands expropriated, is not unduly
oppressive upon the landowner. It is noted that the smaller the land, the bigger the payment in money,
primarily because the small landowner will be needing it more than the big land owner, who can afford a
bigger balance in bonds and other things of value. No less importantly, the government financial
instruments making up the balance of the payment are "negotiable at any time." The other modes,
which are likewise available to the landowner at his option, are also not unreasonable because payment
is made in shares of stock, LBP bonds, other properties or assets, tax credits, and other things of value
equivalent to the amount of just compensation."

II. Scope

A. Lands Covered

1. The Comprehensive Agrarian Reform Law of 1988 shall cover, regardless of tenurial arrangement and
commodity produced, ALL PUBLIC AND PRIVATE AGRICULTURAL LANDS as provided in Proclamation
No. 131 and Executive Order No. 229, including other lands of the public domain suitable for
agriculture: Provided, That landholdings of landowners with a total area of five (5) hectares and
below shall not be covered for acquisition and distribution to qualified beneficiaries. [Section 4]

a. Agricultural land refers to land devoted to agricultural activity and not classified as mineral,
forest, residential, commercial or industrial land [Section 3(c)].
b. Agricultural activity means the cultivation of the soil, planting of crops, growing of fruit trees,
raising of 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 [Section 3(b)].

2. Specifically, the following lands are covered by the Comprehensive Agrarian Reform Program:
 a. All alienable and disposable lands of the public domain devoted to or suitable for agriculture. No
reclassification of forest or mineral lands to agricultural lands shall be undertaken after the
approval of this Act until Congress, taking into account ecological, developmental and equity
considerations, shall have determined by law, the specific limits of the public domain;

b. All lands of the public domain in excess of the specific limits as determined by Congress in the
preceding paragraph;

c. All other lands owned by the Government devoted to or suitable for agriculture; and

d. All private lands devoted to or suitable for agriculture regardless of the agricultural products
raised or that can be raised thereon.

B. Exclusions from the Coverage of CARL

1. Under Section 102, excluded from the coverage of the CARL are lands actually, directly and
exclusively used for:

a. Parks;
b. Wildlife;
c. Forest reserves;
d. Reforestation;
e. Fish sanctuaries and breeding grounds;
f. Watersheds and mangroves.

2. Private lands actually, directly and exclusively used for prawn farms and fishponds shall be exempt
from the coverage of this Act: Provided, That said prawn farms and fishponds have not been
distributed and Certificate of Land Ownership Award (CLOA) issued to agrarian reform
beneficiaries under the Comprehensive Agrarian Reform Program.
In cases where the fishponds or prawn farms have been subjected to the Comprehensive Agrarian
Reform Law, by voluntary offer to sell, or commercial farms deferment or notices of compulsory
acquisition, a simple and absolute majority of the actual regular workers or tenants must consent to
the exemption within one (1) year from the effectivity of this Act. When the workers or tenants do
not agree to this exemption, the fishponds or prawn farms shall be distributed collectively to the
worker-beneficiaries or tenants who shall form a cooperative or association to manage the same.

3. Likewise, execluded from the coverage the CARL are lands actually, directly and exclusively used and
found to be necessary for:

a. National defense;
b. School sites and campuses including experimental farm stations operated by public or private
schools for educational purposes;
c. Seeds and seedling research and pilot production center;
d. Church sites and convents appurtenant thereto;
e. Mosque sites and Islamic centers appurtenant thereto;
f. Communal burial grounds and cemeteries;
g. Penal colonies and penal farms actually worked by the inmates; and
h. Government and private research and quarantine centers.

4. All lands with eighteen percent (18%) slope and over which are not developed for agriculture are

2 As amended by Republic Act No. 7881.

 exempted from the coverage of CARL.

* An eighteen percent slope is not equivalent to an eighteen degree angle. Eighteen percent
slope is obtained by having a 100 meter run and an 18 meter rise.

5. In the case of Luz Farms v. Secretary of Agrarian Reform,3 the Supreme Court has excluded
agricultural Lands Devoted to Commercial Livestock, Poultry and Swine Raising from the coverage of
CARL.

The Supreme Court said:

"The transcripts of the deliberations of the Constitutional Commission of 1986 on the meaning
of the word "agricultural," clearly show that it was never the intention of the framers of the Constitu-
tion to include livestock and poultry industry in the coverage of the constitutionally-mandated
agrarian reform program of the Government.

"The Committee adopted the definition of "agricultural land" as defined under Section 166 of RA
3844, as lands devoted to any growth, including but not limited to crop lands, saltbeds, fishponds,
idle and abandoned land (Record, CONCOM, August 7, 1986, Vol. III, p. 11).

"The intention of the Committee is to limit the application of the word "agriculture." Commis-
sioner Jamir proposed to insert the word "ARABLE" to distinguish this kind of agricultural land from
such lands as commercial and industrial lands and residential properties because all of them fall
under the general classification of the word "agricultural." This proposal, however, was not consid-
ered because the Committee contemplated that agricultural lands are limited to arable and suitable
agricultural lands and therefore, do not include commercial, industrial and residential lands (Record,
CONCOM, August 7, 1986, Vol. III, p. 30).

"In the interpellation, then Commissioner Regalado (now a Supreme Court Justice), posed
several questions, among others, quoted as follows:

xxx xxx xxx

"Line 19 refers to genuine reform program founded on the primary right of farmers and
farmworkers. I wonder if it means that leasehold tenancy is thereby proscribed under this
provision because it speaks of the primary right of farmers and farm workers to own directly or
collectively the lands they till. As also mentioned by Commissioner Tadeo, farmworkers include
those who work in piggeries and poultry projects.
I was wondering whether I am wrong in my appreciation that if somebody puts up a piggery
or a poultry project and for that purpose hires farmworkers therein, these farmworkers will
automatically have the right to own eventually, directly or ultimately or collectively, the land on
which the piggeries and poultry projects were constructed. (Record, CONCOM, August 2, 1986,
p. 618).
xxx xxx xxx"

"The question were answered and explained in the statement of the then Commissioner Tadeo,
quoted as follows:

xxx xxx xxx

"Sa pangalawang katanungan ng Ginoo ay medyo hindi kami nagkaunawaan. Ipinaaalam ko
kay Commissioner Regalado na hindi namin inilagay ang agricultural worker sa kadahilanang
kasama rito ang piggery, poultry at livestock workers. Ang inilagay namin dito ay farm worker

3 192 SCRA 51.

 kaya hindi kasama ang piggery, poultry at livestock workers (Record, CONCOM, August , 1986,
Vol. II, p. 621).

"It is evident from the foregoing discussion that Section 11 of RA 6657 which includes "private
agricultural lands devoted to commercial livestock, poultry and swine raising" in the definition of
"commercial farms" is invalid, to the extent that the aforecited agro-industrial activities are made to
be covered by the agrarian reform program of the State. There is simply no reason to include live-
stock and poultry lands int he coverage of agrarian reform. (Rollo, p. 21).

"PREMISES CONSIDERED, the instant petition is hereby GRANTED. Sections 3(b), 11, 13 and 32 of
R.A. No. 6657 insofar as the inclusion of raising of livestock, poultry and swine in its coverage as well
as the Implementing Rules and Guidelines promulgated in accordance therewith, are hereby
DECLARED null and void for being unconstitutional and the writ of preliminary injunction issued is
hereby MADE permanent."

III. Schedule of Implementation

A. Period for Implementation [Section 5]

1. The DAR, in coordination with the Presidential Agrarian Reform Council (PARC) shall plan and
program the final acquisition and distribution of all remaining unacquired and undistributed
agricultural lands from the effectivity of this Act until June 30, 2014.

B. Priorities [Section 7]

1. Guiding Principle: In effecting the transfer, priority must be given to lands that are tenanted.

2. Factors to consider in the Implementation

a. Need to distribute lands to the tillers at the earliest practical time;

b. Need to enhance agricultural productivity; and
c. Availability of funds and resources to implement and support the program

3. Phases of Implementation

Phase One: During the five (5)-year extension period hereafter all remaining lands above fifty (50)
hectares shall be covered for purposes of agrarian reform upon the effectivity of this Act. All private
agricultural lands of landowners with aggregate landholdings in excess of fifty (50) hectares which have
already been subjected to a notice of coverage issued on or before December 10, 2008; rice and corn
lands under Presidential Decree No. 27; all idle or abandoned lands; all private lands voluntarily offered
by the owners for agrarian reform: Provided, That with respect to voluntary land transfer, only those
submitted by June 30, 2009 shall be allowed: Provided, further, That after June 30, 2009, the modes of
acquisition shall be limited to voluntary offer to sell and compulsory acquisition: Provided, furthermore,
That all previously acquired lands wherein valuation is subject to challenge by landowners shall be
completed and finally resolved pursuant to Section 17 of Republic Act No. 6657, as amended: Provided,
finally, as mandated by the Constitution, Republic Act No. 6657, as amended, and Republic Act No.
3844,as amended, only farmers (tenants or lessees) and regular farmworkers actually tilling the lands, as
certified under oath by the Barangay Agrarian Reform Council (BARC) and attested under oath by the
landowners, are the qualified beneficiaries. The intended beneficiary shall state under oath before the
judge of the city or municipal court that he/she is willing to work on the land to make it productive and
to assume the obligation of paying the amortization for the compensation of the land and the land taxes
thereon; all lands foreclosed by government financial institutions; all lands acquired by the Presidential
Commission on Good Government (PCGG); and all other lands owned by the government devoted to or
suitable for agriculture, which shall be acquired and distributed immediately upon the effectivity of this
Act, with the implementation to be completed by June 30, 2012.
Phase Two: (a) Lands twenty-four (24) hectares up to fifty (50) hectares shall likewise be covered for
purposes of agrarian reform upon the effectivity of this Act. All alienable and disposable public
agricultural lands; all arable public agricultural lands under agro-forest, pasture and agricultural leases
already cultivated and planted to crops in accordance with Section 6, Article XIII of the Constitution; all
public agricultural lands which are to be opened for new development and resettlement: and all private
agricultural lands of landowners with aggregate landholdings above twenty-four (24) hectares up to fifty
(50) hectares which have already been subjected to a notice of coverage issued on or before December
1O, 2008, to implement principally the rights of farmers and regular farmworkers, who are landless, to
own directly or collectively the lands they till, which shall be distributed immediately upon the effectivity
of this Act, with the implementation to be completed by June 30, 2012; and

(b) All remaining private agricultural lands of landowners with aggregate landholdings in excess of
twenty-four (24) hectares, regardless as to whether these have been subjected to notices of coverage or
not, with the implementation to begin on July 1, 2012 and to be completed by June 30, 2013

Phase Three: All other private agricultural lands commencing with large landholdings and
proceeding to medium and small landholdings under the following schedule:

(a) Lands of landowners with aggregate landholdings above ten (10) hectares up to twenty - four
(24)hectares, insofar as the excess hectarage above ten (10) hectares is concerned, to begin on July
1,2012 and to be completed by June 30, 2013; and

(b) Lands of landowners with aggregate landholdings from the retention limit up to ten (10) hectares, to
begin on July 1, 2013 and to be completed by June 30, 2014; to implement principally the right of
farmers and regular farmworkers who are landless, to own directly or collectively the lands they till.

The schedule of acquisition and redistribution of all agricultural lands covered by this program shall
be made in accordance with the above order of priority, which shall be provided in the implementing
rules to be prepared by the PARC, taking into consideration the following: the landholdings wherein the
farmers are organized and understand ,the meaning and obligations of farmland ownership; the
distribution of lands to the tillers at the earliest practicable time; the enhancement of agricultural
productivity; and the availability of funds and resources to implement and support the program:
Provided, That the PARC shall design and conduct seminars, symposia, information campaigns, and other
similar programs for farmers who are not organized or not covered by any landholdings. Completion by
these farmers of the aforementioned seminars, symposia, and other similar programs shall be
encouraged in the implementation of this Act particularly the provisions of this Section.

The PARC shall establish guidelines to implement the above priorities and distribution scheme,
including the determination of who are qualified beneficiaries: Provided, That an owner -tiller may be a
beneficiary of the land he/she does not own but is actually cultivating to the extent of the difference
between the area of the land he/she owns and the award ceiling of three (3) hectares: Provided, further,
That collective ownership by the farmer beneficiaries shall be subject to Section 25 of Republic Act No.
6657, as amended: Provided, furthermore, That rural women shall be given the opportunity t o
participate in the development planning and implementation of this Act: Provided, finally, That in no case
 should the agrarian reform beneficiaries' sex, economic, religious, social, cultural and political attributes
adversely affect the distribution of lands.

C. Exceptions from the Implementation Phases

1. Land acquisition and distribution shall be completed by June 30, 2014 on a province -by- province
basis. In any case, the PARC or the PARC Executive Committee (PARC EXCOM), upon recommendation
by the Provincial Agrarian Reform Coordinating Committee (PARCCOM), may declare certain
provinces as priority land reform areas, in which case the acquisition and distribution of private
agricultural lands therein under advanced phases may be implemented ahead of the above
schedules on the condition that prior phases in these provinces have been completed: Provided, That
notwithstanding the above schedules, phase three (b) shall not be implemented in a particular
province until at least ninety percent (90%) of the provincial balance of that particular province as of
January 1, 2009 under Phase One, Phase Two (a), Phase Two (b),,and Phase Three (a), excluding lands
under the jurisdiction of the Department of Environment and Natural Resources (DENR), have been
successfully completed. PARC, upon recommendation of the Provincial Agrarian Reform Coordinating
Committee (PARCCOM), may declare certain provinces or regions as priority land reform areas, in
which case the acquisition and distribution of private agricultural lands therein may be implemented
ahead of schedule. [Section 7]

2. The PARC may suspend the implementation of CARL with respect to ancestral lands for purpose of
identifying and delineating such lands. [Section 9]

IV. Improvement of Tenurial and Labor Relations

A. Leasehold Tenancy

1. Tenancy in General

a. Definition: Agricultural tenancy is the physical possession by a person of land devoted to agricul-
ture, belonging to or legally possessed by another for the purpose of production through the
labor of the former and of the members of his immediate farm household in consider ation of
which the former agrees to share the harvest with the latter or to pay a price certain or ascer -
tainable, either in produce or in money, or in both [Section 3 of RA 1199, Guerrero v. CA 4]

b. Types of Tenancy Relation

i. Sharehold Tenancy; and
ii. Leasehold Tenancy

2. Leasehold vs. Sharehold Tenancy

* The two tenancy systems are distinct and different form each other. In sharehold, the tenant
may choose to shoulder, in addition to labor, any one or more of the items of contri butions (such
as farm implements, work animals, final harrowing, transplanting), while in leasehold, the tenant
or lessee always shoulders all items of production except the land. Under the sharehold system,
the tenant and the landholder are co-managers, whereas in leasehold, the tenant is the sole
manager of the farmholding. Finally, in sharehold tenancy, the tenant and the landholder divide
the harvest in proportion to their contributions, while in leasehold tenancy, the tenant or lessee

4 142 SCRA 136.

 gets the whole produce with the mere obligation to pay a fixed rental. [People v. Adillo 5]

Sharehold Leasehold
Expenses of Production Tenant and Landowner Tenant

Management Tenant and Landowner Tenant

Payment Tenant and landowner divide the Tenant gets the whole produce with the
harvest in proportion to their contribu- mere obligation to pay rent.
tions.

3. Leasehold vs. Civil Lease

* There are important differences between a leasehold tenancy and a civil law lease. The subject
matter of leasehold tenancy is limited to agricultural lands; that of civil law lease may be either rural
or urban property. As to attention and cultivation, the law requires the leasehold tenant to
personally attend to, and cultivate the agricultural land, whereas the civil law lessee need not
personally cultivate or work the thing leased. As to purpose, the landholding in leasehold tenancy is
devoted to agriculture, whereas in civil law lease, the purpose may be for any other lawful pursuit.
As to the law that governs, the civil law lease is governed by the Civil Code, whereas leasehold
tenancy is governed by special laws. [Gabriel v. Pangilinan 6]

Leasehold Tenancy Civil Law Lease

Subject Matter Agricultural lands only Both rural and urban properties

Attention and Cultivation Tenant must personally culti- Lessee does not have to per-
vate sonally cultivate

Purpose Agriculture only Any lawful purpose

Governing Law Special laws Civil Code

4. Purpose of the Leasehold Relation: To protect and improve the tenurial and economic status of the
farmers in tenanted lands. [Section 12]

5. Application [Section 12]

a. Tenanted lands under the retention limit; and

b. Tenanted lands not yet acquired under the CARL

B. Production Sharing Plan

1. Application [Section 13]

a. Any enterprise adopting the scheme provided for in Section 32;

5 68 SCRA 90.

6 58 SCRA 590.
 b. Any enterprise operating under a production venture, lease, management contract or other
similar arrangement;
c. Any farm covered by Section 8 (Private agricultural lands leased by Multinational corporations)
and Section 11 (Commercial farming); and
d. Corporate farms pending final land transfer.

2. Period for Compliance: Within ninety (90) days from effectivity of CARL

3. Scheme (Applies to those individuals or enterprises realiz ing gross sales in excess of five million
pesos per annum, unless the DAR sets a lower ceiling) [Section 32]

a. Three percent (3%) of the gross sales from the production of such lands;
b. Distributed within sixty (60) days of the end of the fiscal year;
c. Treated as additional compensation to regular and other farmworkers of such lands;
d. During the transitory period (before the land is turned over to the farmworker-beneficiaries), at
least one percent (1%) of the gross sales shall be distributed to the managerial, supervisory and
technical group; and
e. If profit is realized, an additional ten percent (10%) of the net profit after tax shall be distributed
to the regular and other farmworkers within ninety (90) days of the end of the fiscal year.

V. Registration

A. Within 180 days from the effectivity of CARL, landowners, natural or juridical, shall file a sworn statement
in the assessor's office the following information:

a. the description and area of the property;

b. the average gross income from the property for at least 3 years;
c. the names of all tenants and farmworkers therein;
d. the crops planted in the property and the area covered by the crop as of June 1, 1987;
e. the terms of mortgages, leases and management contracts subsisting as of June 1, 1987; and
f. the latest declared market value of the land as determined by the city or provincial assessor. (Section
14)

B. The DAR, in coordination with the Barangay Agrarian Reform Committee (BARC) shall register all agricul -
tural lessees, tenants and farmworkers who are qualifies to be beneficiaries under the CARL. These
potential beneficiaries shall provide the following data:

a. names and members of their immediate farm household;

b. owners and administrators of the lands they work on and the length of tenurial relationship;
c. location and area of the land they work;
d. crops planted; and
e. their share in the harvest or amount of rental paid or wages received.

VI. Private Land Acquisition

A. Retention Limit [Section 6]

 1. Five hectares is the retention limit. No person may own or retain, directly or indirectly, any public
or private agricultural land, the size of which shall vary according to factors governing a viable family-
sized farm, such as commodity produced, terrain, infrastructure, and soil fertility as determined by
the Presidential Agrarian Reform Council (PARC), but in no case shall the retention limit exceed five
(5) hectares.

2. Additional three hectares may be awarded to each child, subject to the following qualifications:

a. That the child is at least fifteen (15) years of age; and

b. That the child is actually tilling the land or directly managing the farm.

3. Exceptions to the retention limit of five hectares.

a. Landowners whose lands have been covered by PD 27; and

b. Original homestead grantees or direct compulsory heirs who still own the original homestead at
the time of the approval of CARL, as long as they continue to cultivate said homestead.
C. Provincial, city and municipal government ,units acquiring private agricultural lands by
expropriation or other modes of acquisition to be used for actual, direct and exclusive public
purposes, such as roads and bridges, public markets, school sites, resettlement sites, local
government facilities, public parks and barangay plazas or squares, consistent with the approved
local comprehensive land use plan, shall not be subject to the five (5)-hectare retention limit
under this Section and Sections 70 and 73(a) of Republic Act No. 6657, as amended: Provided,
That lands subject to CARP shall first undergo the land acquisition and distribution process of the
program: Provided, further, That when these lands have been subjected to expropriation, the
agrarian reform beneficiaries therein shall be paid just compensation [Section 6-A].

4. Right to choose the area to be retained.

The right to choose the area to be retained, which shall be compact or contigu ous, shall pertain
to the landowner. If the land retained is tenanted, the tenant shall have the option to choose
whether to remain therein or be a beneficiary in the same or another agricultural land. In case the
tenant chooses to remain in the retained area, he shall be considered a leaseholder and shall lose his
right to be a beneficiary under this Act. In case the tenant chooses to be a beneficiary in another
agricultural land, he loses his right as a leaseholder to the land retained by the landowner. The
tenant must exercise this option within a period of one (1) year from the time the landowner
manifest his choice of the area for retention.

B. Procedure

1. Voluntary Land Transfer (VLT) [Section 20]

a. Must be submitted to the DAR within one year from effectivity of the CARl;
b. Must not be less favorable to the transferee than those of the government's standing ; and
c. Shall include sanctions for non-compliance by either party and shall be duly recorded and its
implementation monitored by the DAR.
D. Only those submitted by June 30, 2009 shall be allowed.

2. Compulsory Acquisition [Section 16]

a. Notice to acquire the land shall be sent to the landowner and the beneficiaries. The notice shall
 also be posted in a conspicuous place in the municipal building and the barangay hall of the
place where the property is located.
b. Within thirty (30) days from receipt of the written notice, the landowner shall inform the DAR of
his acceptance or rejection of the offer.
c. If the offer is accepted, the LBP pays the landowner and within thirty (30) days, the landowner
executes and delivers a deed of transfer to the Government and surrenders the Certificate of
Title and other muniments of title.
d. In case of rejection or failure to reply, the DAR shall conduct summary administrative
proceedings to determine the compensation. If he does concur with the compensation deter-
mined by the DAR, he can the matter to the Courts.
e. Payment of the just compensation as determined by the DAR or the Court.
f. Registration with the Register of Deeds for the issuance of Transfer Certificate of Title in the
name of the Republic of the Philippines.
g. Standing Crops: The landowner shall retain his share of any standing crops unharvested at the
time the DAR shall take possession of the land and shall be given reasonable time to harvest the
same (Section 28).

C. Compensation

1. Determination of Just Compensation.

In determining just compensation, the cost of acquisition of the land, the value of the standing
crop, the current: value of like properties, its nature, actual use and income, the sworn valuation by
the owner, the tax declarations, the assessment made by government assessors, and seventy percent
(70%) of the zonal valuation of the Bureau of Internal Revenue (BIR), translated into a basic formula
by the DAR shall be considered, subject to the final decision of the proper court. The social and
economic benefits contributed by the farmers and the farmworkers and by the Government t o the
property as well as the nonpayment 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 17].

2. Under EO 405 (1990), Land Bank of the Philippines shall be primarily responsible for the determina -
tion of the land valuation and compensation.

3. Mode of Payment [Section 18]

a. Cash under the following scheme:

i. For lands above 50 hectares : 25%

ii. For lands above 24 and up to 50 : 30%
iii. For lands 24 and below : 35%

* In case of VOS, the landowner shall be entitled to an additional 5% cash pay ment. [Section
19]

b. Balance in any of the following:

i. Shares of stock in government-owned or controlled corporations, LBP preferred shares,

physical assets or other qualified investments;
ii. Tax credits which can be used against any tax liability;
 iii. Land Bank of the Philippines Bonds which shall have the following features:
* 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 year; and
* Transferability and negotiability

c. Set-off

* All arrearages in real property taxes, without penalty or interest, shall be deductible from
the compensation to which the owner is entitled. [Section 66]

D. Exemptions from Taxes and Fees

1. Transactions under CARL involving a transfer of ownership, whether from natural or juridical persons,
shall be exempted from taxes arising from capital gains. These transactions shall also be exempted
from the payment of registration fees, and all other taxes and fees for the conveyance or transfer
thereof; Provided, That all arrearages in real property taxes, without penalty or interest, shall be de-
ducted from the compensation to which the owner may be entitled. [Section 66]

2. All Registers of Deeds are hereby directed to register, free from payment of all fees and other
charges, patents, titles and documents required for the implementation of CARP. [Section 67]

VII. Land Redistribution

A. Beneficiaries [Section 22]

Beneficiaries, in their order of priority, are:

1. Agricultural lessees and share tenants;

2. Regular Farmworkers: a natural person who is employed on a permanent basis by an agricultural
enterprise or farm [Section 3(h)];

a. Farmer refers to a natural person whose primary livelihood is cultivation of land or the
production of agricultural crops, livestock and/or fisheries either by himself/herself, or primarily
with the assistance of his/her immediate farm household, whether the land is owned by
him/her, or by another person under a leasehold or share tenancy agreement or arrangement
with the owner thereof [Section 3(f)].
b. Farmworker is a natural person who renders service 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. It 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 [Section 3(g)].

3. Seasonal farmworkers: a natural person who is employed on a recurrent, periodic or intermittent

basis by an agricultural enterprise or farm, whether as a permanent or an non-permanent laborer,
such as "dumaan", "sacada", and the like [Section 3(i)];

4. Other farmworkers: a farmworker who is not a regular nor a seasonal farmworker [Section 3(j)];
 5. Actual tillers or occupants of public lands;

6. Collective or cooperatives of the above beneficiaries; and

* 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 [Section 3(k)].

7. Others directly working on the land.

Before any award is given to a farmer, the qualified children of the landowner must receive their
three hectare award.

Rural women refer to women who are engaged directly or indirectly in farming and/or fishing as
their source of livelihood, whether paid or unpaid, regular or seasonal, or in food preparation, managing
the household, caring for the children, and other similar activities [Section 3(l)].

B. Disqualifications of Beneficiaries [Section 22]

1. Beneficiaries under Presidential Decree No. 27 who have culpably sold, disposed of, or abandoned
their land;

2. Beneficiaries guilty of negligence or misuse of the land or any support extended to them;

* The mere fact that the expected quantity of harvest, as visualized and calculated by agricultural
experts, is not actually realized, or that the harvest did not increase, is not a sufficient basis for
concluding that the tenants failed to follow proven farm practices. [Belmi v. CAR 7]

3. Beneficiaries with at least three (3) hectares of agricultural land; and

* Under the CARL, a beneficiary is landless if he owns less than three (3) hectares of agri cultural
land. [Section 25]

4. Beneficiaries whose land have been the subject of foreclosure by the Land Bank of the Philippines.
[Section 26]

* Under the CARL, the LBP may foreclose on the mortgage for non-payment of the beneficiary of
an aggregate of three (3) annual amortizations. [Section 26]

C. Awards

1. Emancipation Patents (EPs) are issued for lands covered under Operation Land Transfer (OLT) of
Presidential Decree No. 27.

2. Certificates of Land Ownership Award (CLOAs) are issued for private agricultural lands and resettle-
ment areas covered under Republic Act No. 6657, otherwise known as the Comprehensive Agrarian
Reform Law of 1988.

7 7 SCRA 812.
 3. Free Patents are issued for public agricultural lands.

* Under Section 15 of EO 229 (1987), all alienable and disposable lands of the public domain
suitable for agriculture and outside proclaimed settlements shall be redistributed by the
Department of Environment and Natural Resources (DENR).
4. Certificates of Stewardship Contracts are issued for forest areas under the Integrated Social Forestry
Program.

D. Manner of Payment [Section 26]

1. Lands awarded shall be paid by the beneficiaries to the LBP in thirty (30) annual amortizations at six
percent (6%) interest per annum. The payments for the first three (3) years after the awards may be
at reduced amounts as established by the PARC: Provided, That the first five (5) annual payments
may not be more than five percent (5%) of the value of the annual gross production as established by
the DAR. Should the scheduled annual payments after the fifth year exceed ten percent (10%) of the
annual gross production and the failure to produce accordingly is not due to the beneficiary's fault,
the LBP may reduce the interest rate or reduce the principal obligation to make the repayment
affordable.

2. Payment shall be:

a. Thirty (30) annual amortizations (First 3 years may be at reduced amounts);

b. Six percent (6%) interest per annum; and
c. First five (5) annual payments may not be more than five percent (5%) of the value of the annual
gross production.

E. Ownership Limitations on the Awarded Lands

1. Transferability of Awarded Lands. - Lands acquired by beneficiaries may not be sold, transferred or
conveyed except through hereditary succession, or to the government, or to the Land Bank of the
Philippines, or to other qualified beneficiaries for a period of ten (10) years. [Section 27]

* If the land is sold to the government or to the LBP, the children or the spouse of the transferee
shall have a right to repurchase within a period of two (2) years.

2. Conversions of Lands. - An application for conversion may be entertained only after the lapse of five
(5) years from the award, when the land ceases to be economically feasible and sound for agri -
cultural purposes or the locality has become urbanized and the land will have a greater economic
value for residential, commercial or industrial purpose. [Section 66]

VIII. Corporate Farms

A. Definition

* Corporate farms are farms which are owned or operated by corporations or other business associa-
tions. [Section 29]
 B. Distribution

1. Land Transfer (Voluntarily Offer to Sell or Compulsory Acquisition)

a. General rule: Lands shall be distributed directly to the individual farmworker-beneficiaries.

b. Exception: However, if it is not economically feasible and sound to divide the land, then it shall
be owned collectively by the farmworker-beneficiaries through a workers' cooperative or
association. [Section 29]
c. In case the land is transferred to a cooperative or association, the individual members of the
cooperatives shall be provided with homelots and small farmlots for their family use, to be taken
from the land owned by the cooperative. [Section 30]

2. Capital Stock Transfer [Section 31]

a. This is a non-land transfer. Corporations or associations which voluntarily divest a proportion of

their capital stock, equity or participation in favor of their workers or other qualified beneficia-
ries shall be deemed to have complied with CARL.
b. Amount to be divested: Corporations owning agricultural lands may give their qualified
beneficiaries the right to repurchase such proportion of the capital stock of the corpo ration that
the agricultural land, actually devoted to agricultural activities, bears in relation to the
company's total assets.

* Agricultural activity means the cultivation of the soil, planting of crops, growing of fruit
trees, raising of 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 [Section 3(b)].

c. Conditions of the Capital Stock Transfer.

i. The books of the corporation shall be subject to periodic audit by certified public accoun -
tants chosen by the beneficiaries;
ii. The beneficiaries shall be assured of at least one (1) representative in the board of direc tors,
or in a management or executive committee, if one exists;
iii. Any share acquired by the beneficiaries shall have the same rights and features as all other
shares; and
iv. Any transfer of shares of stock by the original beneficiaries shall be void ab initio unless said
transaction is in favor of a qualified and registered beneficiary within the same corporation.

d. Period for Compliance: If within TWO (2) YEARS from the approval of CARL or from the approval
of the PARC of the plan for stock distribution, the stock transfer is not made or realized, the
agricultural land shall be subject to compulsory coverage of the CARL.

IX. Support Services

A. General Support and Coordinative Services [Section 35]

1. Irrigation facilities;
 2. Infrastructure development and public works projects in areas and settlements that come under
agrarian reform;
3. Government subsidies for the use of irrigation facilities;
4. Price support and guarantee for all agricultural produce;
5. Extending the necessary credit;
6. Promoting, developing and extending financial assistance to small and medium scale industries in
agrarian reform areas;
7. Assigning sufficient numbers of agricultural extension workers to farmers' organizations;
8. Undertaking research, development and dissemination of information on agrarian reform and low-
cost and ecologically sound farm inputs and technologies to minimize reliance on expensive and
imported agricultural inputs;
9. Development of cooperative management through intensive training;
10. Assistance in the identification of ready markets for agricultural produce and training in other various
aspects of marketing; and
11. Administration, operation, management and funding of support service programs and projects
including pilot projects and models related to agrarian reform.

B. Support Services to Beneficiaries [Section 37]

1. Land surveys and titling;

2. Liberalized terms on credit facilities and production loans;
3. Extension services by way of planting, cropping, production and post-harvest technology transfer, as
well as marketing and management assistance and support to cooperatives and farmers'
organizations;
4. Infrastructure such as access trail, mini-dams, public utilities, marketing and storage facilities; and
5. Research, production and use of organic fertilizers and other local substances necessary in farming
and cultivation.

C. Support Services to Landowners [Section 38]

1. Investment information, financial and counselling assistance;

2. Facilities, programs and schemes for the conversion or exchange of bonds issued for payment of the
lands acquired with stocks and bonds issued by the National Government, the Central Bank and
other government institutions and instrumentalities;
3. Marketing of LBP bonds, as well as promoting the marketability of said bonds in traditional and non-
traditional financial markets and stock exchanges;
4. Other services designed to utilize productively the proceeds of the sale of such lands for rural indus-
trialization;
5. Incentives granted to a registered enterprise engaged in a pioneer or preferred area of invest ment as
provided for in the Omnibus Investment Code or granted by the PARC, the LBP or other government
financial institutions for those who invests in rural-based industries; and
6. Redemption by the LBP of up to thirty percent (30%) of the face value of the its bonds for
landowners who will invest the proceeds of the redemption in a BOI-registered company or in any
agri-business or agro-industrial enterprise in the region where they have previously made
investments.

D. Funding

* At least twenty-five percent (25%) of all appropriations for agrarian reform shall be immediately set
 aside and made available for support services. In addition, the DAR shall be authorized to package
proposals and receive grants, aid and other forms of financial assistance from any source. [Section
36]

X. Special Areas of Concern [Section 40]

A. Subsistence Fishing: Small fisherfolk, including seaweed farmer, shall be assured of greater access to the
utilization of water resources.

B. Logging and Mining Concessions: Subject to the requirement of a balanced ecology and conservation of
water resources, suitable areas in logging, mining and pasture areas, shall be opened up for agrarian
settlements whose beneficiaries shall be required to undertake reforestation and conservation production
methods.

* Certificates of Stewardship Contracts are issued for forest areas under the Integrated Social For estry
Program.

C. Sparsely Occupied Public Agricultural Lands: Sparsely occupied agricultural lands of the public domain
shall be surveyed, proclaimed and developed as farm settlements for qualified landless people.

* Agricultural land allocations shall be made for ideal family-size farms.

* Uncultivated lands of the public domain shall be made available on a lease basis to interested and
qualified parties. Priority shall be given to those who will engage in the development of capital-
intensive, traditional or pioneering crops.

D. Idle, Abandoned, Forecloses and Sequestered Lands: Idle, abandoned, foreclosed and sequestered
lands shall be planned for distribution as home lots and family-size farmlots to actual occupants. If land
area permits, other landless families shall be accommodated in these lands.

E. Rural Women: All qualified women members of the agricultural labor force must be guaranteed and
assured equal rights to ownership of the land, equal shares of the farm's produce, and representation in
advisory or appropriate decision-making bodies.

F. Veterans and Retirees: Landless ware veterans and veterans of military campaigns, their surviving
spouses and orphans, retirees of the Armed Forces of the Philippines and the Integrated National Police,
returnees, surrenderees and similar beneficiaries shall be given due consideration in the disposition of
agricultural lands of the public domain.

G. Agriculture Graduates: Graduates of agricultural schools who are landless shall be assisted by the
government in their desire to own and till agricultural lands.

XI. Program Implementation

A. Presidential Agrarian Reform Council (PARC)

 1. Composition [Section 41]

a. Chairman: President of the Philippines

b. Vice-Chairman: Secretary of Agrarian Reform
c. Members:
i. Secretary of Agriculture;
ii. Secretary of Environment and Natural Resources;
iii. Secretary of Budget and Management;
iv. Secretary of Local Government;
v. Secretary of Public Works and Highways;
vi. Secretary of Trade and Industry;
vii. Secretary of Finance;
viii. Secretary of Labor and Employment;
ix. Director-General of National Economic and Development Authority;
x. President of Land Bank of the Philippines;
xi. Administrator of National Irrigation Authority;
xii. Three (3) representatives of affected landowners to represent Luzon, Visayas and Mindanao;
and
xiii. Six (6) representatives of agrarian reform beneficiaries, two (2) each from Luzon, Visayas
and Mindanao, provided that one of them shall be from cultural communities.

2. Functions and Duties [EO 229, 1987]

a. Formulate and implement policies, rules and regulations necessary to implement the CARP;
b. Recommend small farm economy areas;
c. Schedule the acquisition and distribution of specific agrarian reform areas; and
d. Control mechanisms for evaluating the owner's declaration of current fair market value.

3. Executive Committee (EXCOM) of the PARC [Section 42]

a. There shall be an Executive Committee of the PARC which shall meet and decide on any and all
matters in between meetings of the PARC: Provided, however, That its decision must be
reported in the PARC immediately and not later than the next meeting.
b. Composition: The Secretary of Agrarian Reform shall be the Chairman and its members shall be
designated by the President, taking into account Article XIII, Section 5 of the Consti tution (Rights
of farmers to participate in the planning, organization and management of the CARP).

4. PARC Secretariat [Section 43]

a. A PARC Secretariat is established to provide general support and coordinative services such as
inter-agency linkages, program and project appraisal and evaluation and general operations
monitoring for the PARC.
b. Composition: The Secretariat shall be headed by the Secretary of Agrarian Reform who shall be
assisted by an Undersecretary and supported by a staff whose composition shall be determined
by the PARC Executive Committee.

B. Provincial Agrarian Reform Coordinating Committee (PARCCOM)

1. Composition (Section 44)

a. Chairman: an appointee of the President upon recommendation of the PARC EXCOM;

 b. Executive Officer: Provincial Agrarian Reform Officer;
c. Members:
i. Representative from the Department of Agriculture;
ii. Representative for the Department of Environment and Natural Resources;
iii. Representative for the Land Bank of the Philippines;
iv. One representative each from existing farmers' organizations, agricultural cooperatives and
non-governmental organizations in the province;
v. Two representatives from the landowners, at least one of whom shall be a producer repre-
senting the principal crop of the province;
vi. Two representatives from farmers and farmworker beneficiaries, at least one of whom shall
be a farmer or farmworker representing the principal crop of the province; and
vii. In areas where there are cultural communities, there shall be one representative from
them.

2. Functions and Duties

a. Coordinate and monitor the implementation of the CARP in the province;

* The PARC shall provide the guidelines for a province-by-province implementation of the
CARP. The ten-year program of distribution of public and private lands in each province
shall be adjusted from year to year by the province's PARCCOM, in accordance with the level
of operations previously established by the PARC, in every case ensuring that support
services are available or have been programmed before actual distribution is effected. [Sec-
tion 45]
b. Provide information on the following:
i. Provisions of the CARP;
ii. Guidelines issued by the PARC; and
iii. Progress of the CARP in the province.

C. Barangay Agrarian Reform Committee (BARC)

1. Composition [EO 229, 1987]

* The BARC shall be operated on a self-help basis and will be composed of the following:

a. Representatives of farmer and farmworker beneficiaries;

b. Representatives of farmer and farmworker non-beneficiaries;
c. Representatives of agricultural cooperatives;
d. Representatives of other farmer organizations;
e. Representatives of the Barangay Council;
f. Representatives of non-governmental organization (NGOs);
g. Representatives of landowners;
h. Department of Agriculture official assigned to the area;
i. Department of Environment and Natural Resources official assigned to the area;
j. DAR Agrarian Reform Technologist assigned to the area; and
k. Land Bank of the Philippines representative.

2. Functions [EO 229, 1987 and Section 47]

* The BARC shall have the following functions:

a. Mediate and conciliate between parties involved in an agrarian dispute;

 b. Assist in the identification of qualified beneficiaries and landowners within the barangay;
c. Attest to the accuracy of the initial parcellary mapping of the beneficiary's tillage;
d. Assist qualified beneficiaries in obtaining credit from lending institutions;
e. Assist n the initial determination of the value of the land;
f. Assist the DAR representative in the preparation of periodic reports on the CARP implemen-
tation;
g. Coordinate the delivery of support services to beneficiaries;
h. Participate and give support in the implementation of CARP; and
i. Perform such other functions as may be assigned by the PARC and DAR.

D. Others

1. No injunction, restraining order, prohibition or mandamus shall be issued by the lower courts against
the DAR, DA, DENR and DOJ in their implementation of CARP. [Section 68]

* This does not apply to the Supreme Court.

2. The PARC, in the exercise of its functions, is hereby authorized to call upon the assistance and
support of other government agencies, bureaus and offices, including government-owned or
controlled corporations. [Section 69]

XII. Administrative Adjudication

A. Jurisdiction

1. The Department of Agrarian Reform is hereby vested with primary jurisdiction to determine and
adjudicate agrarian reform matters and shall have exclusive original jurisdiction over all matter
involving the implementation of agrarian reform, except those falling under the exclusive juris-
diction of the Department of Agriculture and the Department of Environment and Natural
Resources. [Section 50]

2. DAR Adjudicator

a. Department of Agrarian Reform Adjudication Board (DARAB)

i. Exercises both original and appellate jurisdiction
ii. Exercises functional supervision over the RARADs and PARADs

b. Regional Agrarian Reform Adjudicator (RARAD)

i. Executive Adjudicator in his region
ii. Receives, hears and adjudicates cases which the PARAD cannot handle because the latter is
disqualified or inhibits himself or because the case is complex or sensitive

c. Provincial Agrarian Reform Adjudicator (PARAD)

3. Exclusive Jurisdiction of the Secretary of Agrarian Reform

* Matter involving strictly the administrative implementation of the CARP and agrarian laws
 and regulations shall be the exclusive prerogative of and cognizable by the Secretary of Agrarian
Reform

B. BARC Certification Requirement

1. The DAR shall not take cognizance of any agrarian dispute of controversy unless a certification from
the BARC that the dispute has been submitted to it for mediation and concilia tion without any
success of settlement is presented. [Section 53]

* Failure to present a BARC certification is not a ground for dismissal of the action. The
complainant or petitioner will be given every opportunity to secure the BARC certification. [Rule
III, Section 1(c) of the DARAB Rules]

2. Exceptions to the BARC Certification Requirement:

a. Failure of the BARC to issue a certification within thirty (30) days after a matter or issue is
submitted to it;
b. The required certification cannot be complied with for valid reasons like the non-existence or
non-organization of the BARC or the impossibility of convening it. A certification to that effect
may be issued by the proper agrarian reform officer in lieu of the BARC certification; [Rule III,
Section 1(b) of DARAB Rules]
c. The issue involves the valuation of the land to determine just compensation; [Rule III, Section 2
of DARAB Rules]
d. The parties reside in different barangays, unless they adjoin each other;
* Where the lands involved in the dispute straddles two or more barangays, the BARC of the
Barangay where the biggest portion lies, shall have the authority to conduct the mediation
or conciliation proceeding.
e. One of the party is a public or private corporation, a partnership, association or juridical person,
or a public officer or employee and the dispute relates to the performance of his official
functions;
f. The issue involves merely the administrative implementation of agrarian reform law, rule,
guideline or policy; and
g. The issue is beyond the pale of mediation, conciliation or compromise, as determined by the
Secretary of Agrarian Reform.

C. Rules of Procedure

1. It shall not be bound by technical rules of procedure and evidence but shall proceed to hear and
decide all cases, disputes or controversies in a most expeditious manner, employing all reasonable
means to ascertain the facts of every case in accordance with justice and equity and the merits of
the case. [Section 50]

2. Responsible leaders shall be allowed to represent themselves, their fellow farmers, or their organi-
zations in any proceedings before the DAR [Section 50]

3. To discourage frivolous or dilatory appeals from the decision or order on the local or provincial
levels, the DAR may impose reasonable penalties, including but not limited to fines or censures upon
erring parties. [Section 52]

D. Enforcement Powers
 1. It shall have the power to summon witnesses, administer oaths, take testimony, require submission
of reports, compel the production of books and documents and answers to interrogatories and issue
subpoena, and subpoena duces tecum and to enforce its writs through sheriffs or other duly depu -
tized officers. It shall likewise have the power to punish direct and indirect contempt in the same
manner and subject to the same penalties as provided in the Rules of Court. [Section 50]

2. The DAR has executed a Memorandum of Agreement with the Philippine National Police, in order
that the latter may assist the DAR in the enforcement of its orders.

E. Judicial Review

1. Any decision, order, award or ruling of the DAR on any agrarian dispute or on any matter pertaining
to the application, implementation, enforcement or interpretation of the CARL and other pertinent
laws on agrarian reform may be brought to the Court of Appeals by certiorari within fifteen (15)
days from receipt of a copy thereof. [Section 54]

2. The findings of fact of the DAR shall be final and conclusive if based on substantial evidence.

3. Notwithstanding an appeal to the Court of Appeals, the decision of the DAR shall be immediately
executory. [Section 50]

XIII. Special Agrarian Court

A. Jurisdiction [Section 57]

1. The Special Agrarian Courts (Regional Trial Courts) shall have original and exclusive jurisdiction over:

a. All petitions for the determination of just compensation to landowners; and

b. The prosecution of all criminal offenses under the CARL.

2. The Special Agrarian Courts, upon their own initiative or at the instance of any of the parties, may
appoint one or more commissioners to examine, investigate and ascertain facts relevant to the
dispute, including the valuation of properties and to file a written report thereof with the court.

B. Appeals

1. Appeal from the Decision of the Special Agrarian Court

* Within fifteen (15) days from the receipt of the decision of the Special Agrarian Court, an appeal
may be taken by filing a petition for review with the Court of Appeals.

2. Appeal from the Decision of the Court of Appeals

* Within a non-extendible period of fifteen (15) days from the receipt of the decision of the Court of
Appeals, an appeal may be taken by filing a petition for review with the Supreme Court.
XIV. Prohibited Acts and Omissions

A. Prohibited Acts and Omissions

1. Section 73. The following are prohibited.

a. The ownership or possession, for the purpose of circumventing the provisions of CARL, of
agricultural lands in excess of the total retention limits or award ceilings by any person, natural
or juridical, except those under collective ownership by farmer-beneficiaries.
b. The forcible entry or illegal detainer by persons who are not qualified beneficiaries to avail
themselves of the rights and benefits of the CARP.
c. The conversion by any landowner of his agricultural land into non-agricultural uses with intent to
avoid the application of CARL to his landholdings and to dispossess his tenant farmers of the
land tilled by them.
d. The willful prevention or obstruction by any person, association or entity of the implementation
of the CARP.
e. The sale, transfer, conveyance or change of the nature of lands outside of urban centers and city
limits either in whole or in part after the effectivity of CARL.
i. Upon the effectivity of CARL, any sale, disposition, lease, management contract or transfer
of possession of private lands executed by the original landowner in violation of CARL shall
be null and void; Provided, however, that those executed prior to CARL shall be valid only
when registered with the Register of Deeds within a three (3) months after the effect ivity of
CARL. [Section 6]

* Exception: Banks and other financial institutions allowed by law to hold mortgage rights or
security interests in agricultural lands to secure loans and other obligations of borrowers,
may acquire title to these mortgaged properties, regardless of area, subject to existing laws
on compulsory transfer of foreclosed assets and acquisition as prescribed under Section 16
of CARL [Section 71]

ii. Disposition of private lands is in violation of CARL if it is over the retention limit.

iii. The date of registration of the deed of conveyance in the Register of Deeds with respect to
title lands and the date of the issuance of the tax declaration to the transferee of the
property with respect to untitled lands shall be conclusive for this purpose.

f. The sale, transfer of conveyance by a beneficiary of the right to use or any other usufructuary
right over the land he acquired by virtue of being a beneficiary, in order to circumvent the
provisions of CARL. [Refer to VII(E) of this Outline]

2. Any person who knowingly or willfully violates the provisions of CARL shall be punished by
imprisonment of not less than one (1) month to not more than three (3) years or a fine of not less
than one thousand pesos (P 1,000.00) and not more than fifteen thousand pesos (P 15,000.00), or
both at the discretion of the court.
If the offender is a corporation or association, the officer responsible therefor shall be criminally
liable.

B. Conversions

1. Authority to Allow Conversion of Agricultural Land for Non-agricultural Uses

 a. Under Executive Order No. 129-A, Series of 1987, the Department of Agrarian Reform is
authorized to:
i. Approve or disapprove the conversion, restructuring or readjustment of agricultural lands
into non-agricultural uses; [Section 4(j)]
ii. Have exclusive authority to approve or disapprove conversion of agricultural lands for
residential, commercial, industrial and other land uses as may be provided for by law.
[Section 5(l)]

b. The Comprehensive Agrarian Reform Law provides that the DAR ... may authorize the
reclassification or conversion on the land and its disposition. [Section 65]

2. Conversion

a. After the lapse of five (5) years from its award, when the land ceases to be economically feasible
and sound for agricultural purposes, or the locality has become highly urbanized and the land
will have greater economic value for residential, commercial or industrial purposes, the DAR,
upon application of the beneficiary or the landowner, may authorize the reclassification or
conversion on the land and its disposition: Provided, That the beneficiary shall have fully paid
his obligation. [Section 65]

b. Grounds for conversion

i. Five (5) years had lapsed from the award of the land;
ii. The land ceases to be economically feasible and sound for agricultural purposes, or the
locality has become highly urbanized and the land will have greater econom ic value for
residential, commercial or industrial purposes; and
iii. Beneficiary shall have fully paid his obligation.

c. Administrative Order No. 20, Series of 1992 [Took effect on 30 December 1992]

* President Fidel V. Ramos directed the observance by all agencies and local government units
the following interim guidelines on agricultural land use conversion.

i. All irrigated or irrigable agricultural lands shall not be subject to and non-negotiable for
conversion;
ii. All other agricultural lands may be converted only upon strict compliance with existing
laws, rules and regulations.

3. Disturbance Compensation

* Section 36(1) of Republic Act No. 3844, as amended provides: the agricultural lessee shall be
entitled to disturbance compensation equivalent to five years rental on his landholding.

* Displaced farmers are entitled to disturbance compensation which varies depending on the
agreement between the farmers and the landowners.

XV. Relation to Other Laws

 A. Suppletory Application: The provisions of Republic Act No. 3844, as amended, Presidential Decree Nos.
27 and 266, as amended, Executive Order Nos. 228 and 229, both Series of 1987; and other laws not
inconsistent with this Act shall have suppletory effect. [Section 75]

B. Repealing Clause: Section 35 of Republic Act No. 3844, Presidential Decree No. 316, the last two
paragraphs of Section 12 of Presidential Decree No. 946, Presidential Decree No. 1038, and all other laws,
decrees, executive orders, rules and regulations, issuances or parts thereof inconsistent with CARL are
hereby repealed or amended accordingly.

XVI. Effectivity

* CARL takes effect immediately after publication in at least two (2) national newspapers of general
circulation. CARL was printed 15 June 1988.

Prepared by: Atty. Ferdinand M. Casis