An Act Liberalizing the Lease of Private Lands by Foreign Investors, Establishing the Stability of Long-Term Land Lease Contracts, amending for the purpose Republic Act No. 7652, otherwise known as the “Investors’ Lease Act”
The amendment to the thirty-one (31) year old Investors’ Lease Act 1 has been approved on third and final reading in December 2024 by both the lower and upper chambers of the Legislative Branch.
The bill reflects the State’s encouragement to foreign investments consistent with the constitutional mandate to conserve and develop our own patrimony2. In this regard, the bill adopts a flexible and dynamic policy on the granting of long-term land lease to foreign investors for the establishment of industrial estates, factories, assembly or processing plants, agro-industrial enterprises, land development for or commercial use, tourism, agriculture, agro-forestry, ecological conservation, and other similar priority productive endeavors. It is the bill’s aim to ensure the reliability of investors’ lease contracts to provide a stable environment for foreign investments.3
Through this bill, any foreign investor investing in the Philippines will be allowed to lease private lands in the aggregate period of ninety-nine (99) years. However, the leased area must be used solely for the approved and registered investment.4
Foreign investments are encouraged to fill in capital gaps, help provide employment, increase production, and provide a base for the overall development of the economy. Investment rules and regulations have thus been liberalized to facilitate entry of foreign investments.5
The Philippines, with its strategic location, is a gateway to the huge Asian market. Its considerable attractions as an investment destination include, among others:
- A pool of English-speaking people who are highly trainable. Their capabilities and merits as blue-collar workers, technicians, professionals and managers have been confirmed in postings with foreign firms operating in the Philippines and overseas.
- The potential growth construction enterprises can attain in the country because of the implemented build-operate-transfer (BOT) scheme by the government. The said scheme provides for the development opportunity of construction enterprises, investors funding the construction, operates the facility for a fixed term, recover their investments plus adequate rate of return and fees then transfer the facility to the government.
- A highly developed legal system.6
Legal Expertise
It is vital to keep an eye on contracts and all other paperwork involving your investments as to save yourself from unnecessary headaches and expenses. You get to avoid costly mistakes like penalties, legal fees, and whatnot. A competent legal team will be responsible for drafting agreements, negotiating its terms, finalizing documents, managing final signoffs, monitoring its performance, and addressing potential and actual breaches.7
Written by: Catherine Anne Magsaysay
- https://www.gmanetwork.com/news/money/economy/930136/senate-oks-bill-extending-land-lease-limits-for-foreigners-to-99-years/story/ ↩︎
- Section 1, Senate Bill No. 2898, 19th Congress. ↩︎
- Id ↩︎
- Section 2, Senate Bill No. 2898, 19th Congress. ↩︎
- https://beta.tourism.gov.ph/doing-business/#:~:text=Foreign%20investments%20are%20encouraged%20to,facilitate%20entry%20of%20foreign%20investments. ↩︎
- Id ↩︎
- https://pro.bloomberglaw.com/insights/contracts/guide-to-legal-contract-management/#:~:text=Often%20attorneys%20are%20responsible%20for,or%20other%20issues%20impeding%20performance. ↩︎