August 25, 2003
DAR OPINION NO. 14-03
Director Renato R. Navata
DAR Region II
Tuguegarao City
Cagayan
Dear Director Navata:
This refers to your letter dated November 6, 2002, regarding the transfer of lands acquired by the Cagayan Economic Zone Authority (CEZA) in favor of the government. AacCHD
You presented the following queries:
1. If the transferee is a government owned and controlled corporation like the applicant, is it still required to secure a DAR clearance as a precondition for the registration of such acquired agricultural lands in the name of the Republic of the Philippines as represented by its Administrator?
DAR Administrative Order No. 01, Series of 1989 (RULES AND PROCEDURES GOVERNING LAND TRANSACTIONS), enumerates the transactions which may be registered by the Register of Deeds without prior clearance from DAR, to wit:
"II. RULES ON VALIDITY OF LAND TRANSACTIONS
(a) The following are not prohibited transactions and may be registered by the Register of Deeds without prior clearance from DAR:
a. Deed of extra judicial partition of the property of deceased who died prior to June 15, 1988.
b. Deed of partition of property owned in common by co-owners prior to June 15, 1988.
c. Sub-division of title without change of ownership.
d. Deed of real (es)state mortgage executed by the original landowner or beneficiary."
Nothing in the abovementioned enumeration includes the case at hand. Therefore, the CEZA has first to secure a DAR clearance before the subject lands herein may be registered with the Register of Deeds.
2. In case such DAR clearance is still necessary, is it still required to submit the requisite Affidavit of property holdings since the transferee is the Republic of the Philippines although represented by its Administrator in all its transactions?
Normally, we require the submission of an Affidavit attesting that transferee's aggregate landholding does not exceed five (5) hectares. However, in the case at hand, we are foregoing the said requirement, for the reason that Economic Zones like the CEZA, would naturally possess vast tracts of land exceeding five (5) hectares. Limiting acquisition of lands (particularly agricultural) would defeat the national interest and public purpose of their creation.
3. If the landholdings have an area beyond five (5) hectares, is the DAR bound to issue the required certification; and if yes, is the PARO clothed with jurisdiction to issue the same?
The Memorandum of Agreement (MOA) between DAR and CEZA, states that:
"Sec. 1. The DAR shall:
1.2. Issue the appropriate clearance lot (sic) lands acquired within the Zone by the CEZA, as may be proper under existing laws, rules and regulations;" (emphasis ours)
In addition to this, DAR A.O. No. 01, Series of 1989 provides:
"The following transactions are valid:
b) Those in favor of the government, DAR or the Land Bank of the Philippines;"
Since the CEZA is a government-owned and controlled corporation and the subject landholdings will be registered in the name of the Republic of the Philippines, the transfer would be a valid transaction as it is a transfer in favor of the government. It must be stressed, however, that the DAR clearance being sought is solely for purposes of registration with the Register of Deeds.
As stated in DAR OPINION NO. 07, S. 2003, dated June 6, 2003, "[p]lease note that the issuance of a DAR clearance involving the disposition or transfer of agricultural lands coverable under the Comprehensive Agrarian Reform Program (CARP) merely signifies that the transaction is not in circumvention of the Comprehensive Agrarian Reform Law (CARL) and may therefore be registered. It is not synonymous with a DAR Conversion Order/Clearance which is issued only after determination on the merits of a duly filed application for conversion the effect of which is to change the current physical use of a piece of agricultural land into some other use."
In connection therewith, the PARO is clothed with jurisdiction to issue the said certification in accordance with DAR A.O. 01, Series of 1989 and per Memorandum of Agreement between DAR and CEZA.
It must, however, be made a condition that should the CEZA fail to make use of the subject landholdings in accordance with the purposes for which it was created, said lands devoted to or suitable for agriculture, shall eventually be covered under the Comprehensive Agrarian Reform Program (CARP). CSTEHI
Moreover, the transferor should only be allowed to sell not more than his/her 5-hectare retention area, otherwise, the disposition in favor of CEZA may be used as a scheme to avoid coverage under the CARP.
As a final note, please bear in mind that the tenurial rights and interests of CLOA or EP awardees and other farmworkers who may be displaced/affected by this undertaking, if any, should in all cases be protected/safeguarded. Thus, please ensure that the affected ARBs/awardees in subject landholdings be still entitled as ARBs/awardees to other landholdings if qualified and/or be paid the disturbance compensation.
This opinion is rendered on the basis of the facts presented. However, if upon investigation it will be disclosed that the facts are different, then this opinion shall be considered null and void.
We hope that we have cleared the matter with you.
(SGD.) RICARDO S. ARLANZA
Undersecretary for Policy, Planning
and Legal Affairs Office