April 30, 1998

DAR OPINION NO. 55-98

MR. OSCAR P. BAYLAN

Project Development Manager

Kahayagan Realty and Development Corp.

P.O., Box 81307

Davao City

Dear Mr. Baylan:

This has reference to your letter requesting DAR's position on the issue of the eligibility or non-eligibility for land conversion of commercial farms still under deferment from the coverage of R.A. No. 6657 (Comprehensive Agrarian Reform Law).

The coverage of agricultural lands under Comprehensive Agrarian Reform Program is not affected by the fact that they were placed under commercial deferment. Specifically, this scheme is resorted purposely to allow landowners the chance to recover their investments and insulate them from possible disruptions in operations and productivity during land acquisition and distribution. It is a 10-year transition period pending final transfer of the land to agrarian reform beneficiaries.

While conversion of agricultural lands to non-agricultural uses is allowed, the same is not absolute. Administrative Order No. 363 of the Office of the President and DAR Administrative Order No. 07, Series of 1997 (copy attached) laid down the procedures together with the documentary requirements in applying for land use conversion. It has to be stressed in this context, however, that conversion of an agricultural land shall be determined on the merits thereof and is not supposed to be an alternative option available to the landowners to spare their agricultural lands from CARP coverage. Section 73 (c) of R.A. No. 6657 does not sanction this practice by specifically prohibiting "the conversion by any landowner of his agricultural land into any non-agricultural use with intent to avoid the application of this Act to his landholdings and to dispossess his tenant farmers of the land tilled by them".

We hope to have clarified the matter with you.

Very truly yours,

(SGD.) ARTEMIO A. ADASA, JR.

Undersecretary for Legal Affairs, and Policy and Planning