Be It Enacted by The Senate and House of Representatives of The Philippines in Congress Assembled

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REPUBLIC ACT NO. -7652- ] (1) No lease contract shall be for a period
exceeding fifty (50) years, renewable once for a
AN ACT ALLOWING THE LONG-TERM LEASE OF period of not more than twenty- five (25) years;
PRIVATE LANDS BY FOREIGN INVESTORS
(2) The leased area shall be used solely for the
Be it enacted by the Senate and House of purpose of the investment upon the mutual
Representatives of the Philippines in Congress agreement of the parties;
assembled:
(3) The leased premises shall comprise such area
SECTION 1. Title. – This Act shall be known as the as may reasonably be required for the purpose of
“Investors’ Lease Act.” the investment subject however to the
Comprehensive Agrarian Reform Law and the
SEC. 2. Declaration of Policy. – It is hereby declared Local Government Code.
the policy of the State to encourage foreign
investments consistent with the constitutional The leasehold right acquired under long-term
mandate to conserve and develop our own lease contracts entered into pursuant to this Act
patrimony. Towards this end, the State hereby may be sold, transferred, or assigned: Provided,
adopts a flexible and dynamic policy on the That when the buyer, transferee, or assignee is a
granting of long-term lease on private lands to foreigner or a foreign-owned enterprise, the
foreign investors for the establishment of conditions and limitations in respect to the use of
industrial estates, factories, assembly or the leased property as provided for under this Act
processing plants, agro-industrial enterprises, shall continue to apply.
land development for industrial, or commercial
use, tourism, and other similar priority productive SEC. 5. Limitations. – (1) Foreign individuals,
endeavors. corporations, associations, or partnerships not
otherwise investing in the Philippines as defined
SEC. 3. Definitions. – For purposes of this Act, herein shall continue to be covered by
unless the context indicates otherwise, the term: Presidential Decree No. 471 and other existing
laws in lease of lands to foreigners.
(1) “Investing in the Philippines” shall mean
making an equity investment in the Philippines (2) Withdrawal of the approved investment in the
through actual remittance of foreign exchange or Philippines within the period of the lease
transfer of assets, whether in the form of capital agreement entered into under this Act, or use of
goods, patents, formulae, or other technological the leased area for the purpose other than that
rights or processes, upon registration with the authorized, shall warrant the ipso
Securities and Exchange Commission; and facto termination of the lease agreement without
prejudice to the right of the lessor to be
(2) “Withdrawal of approved investment” shall compensated for the damages he may have
mean either; (a) the failure to operate the suffered thereby.
investment project for any three (3) consecutive
years; or (b) outright abandonment of the (3) Any lease agreement under this Act which is
investment project at any time during the renewable at the option of the lessee subject to
approved lease period: Provided, That failure to the same terms and conditions of the original
pay lease rental for three (3) consecutive months contract shall be interpreted to mean as
coupled with the failure to operate the investment renewable upon the mutual agreement of the
project for the same period shall be deemed an parties.
outright abandonment of the project.
(4) In addition to the conditions for the renewal of
SEC. 4. Coverage. – Any foreign investor investing a lease agreement after the period of fifty (50)
in the Philippines shall be allowed to lease private years as provided herein, the foreign lease shall
lands in accordance with the laws of the Republic show that it has made social and economic
of the Philippines subject to the following contributions to the country.
conditions:

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(5) In the case of tourism projects, lease of private SEC. 10. Effectivity Clause. – this Act shall take
lands by foreign investors qualified herein shall be effect immediately upon its approval.
limited to projects with an investment of not less
than five million (5M) US dollars, seventy percent
(70%) of which shall be infused in said project
within three years from the signing of the lease
contract.

SEC. 6. Termination of Lease Contract. – The


Secretary of Trade and Industry shall terminate
any lease contract entered into under the
provisions of this Act, if the investment project is
not initiated within three (3) years from the
signing of the lease contract.

SEC. 7. Penal Provision. – Any contract or


agreement made or executed in violation of any of
the following prohibited acts shall be null and
void ab initio and both contracting parties shall be
punished by a fine of not less than One Hundred
thousand pesos (P100,000) nor more than One
million pesos (P1,000,000), or imprisonment of
six (6) months to (6) years, or both, at the
discretion of the court:

(1) Any provision in the lease agreement


stipulating a lease period in excess of that
provided in paragraph (1) of Section 4;

(2) Use of the leased premises for the purpose


contrary to existing laws of the land, public order,
public policy, morals, or good customs;

(3) Any agreement or agreements resulting is the


lease of land in excess of the area approved by the
DTI: Provided, That, where the excess of the
totality of the area leased is due to the acts of the
lessee, the lessee shall be held solely liable
therefor: Provided, further, That, in the case of
corporations, associations, or partnerships, the
president, manager, director, trustee, or officers
responsible for the violation hereof shall bear the
criminal liability.

SEC. 8. Separability Clause. – In case any provision


of this Act or the application of such provision is
deemed unconstitutional, the remaining
provisions of this Act or the application of such
provisions shall not be affected thereby.

SEC. 9. Repealing Clause. – All acts, rules and


regulations contrary to or inconsistent with this
Act are hereby repealed or modified accordingly.

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