The plenary hall of the House of Representatives (Dexter Barro II/MANILA BULLETIN)

The House of Representatives has overwhelmingly passed on third and final reading the proposed statute that would foreign investors a lease on private lands for 99 years, which almost doubles the present term of 50 years.

Approved on the strength of 175 affirmative votes during plenary session on Tuesday afternoon, Dec. 17 was House Bill (HB) No. 10755, one of the Marcos administration’s priority bills under the Legislative-Executive Development Advisory Council (LEDAC).

House Speaker Martin Romualdez served as principal author of the measure, which received only three negative votes and two absententions during nominal voting.

He said the proposed 99-year lease addresses the concern of foreign capitalists regarding the shorter rental period under the present law, which was 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,” the Speaker said in a statement shortly after the bill's third reading passage.

He said the proposal also aligns with the open-door policy of President Marcos 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.

HB No.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".

Conditions

The proposed law provides that any foreign investor investing in the Philippines shall be allowed to lease private lands for a period is 99 years. It says the leased area shall be used solely for the purpose of the investment upon the mutual agreement of the parties.

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.

The foreign investor has an approved and registered investment under Republic Act (RA) No. 7042, otherwise known as the Foreign Investments Act of 1991, as amended.

The bill says 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.

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.