Republic of the Philippines 
House of Representatives 
Quezon City, Metro Manila 
1 
Nineteenth Congress 
Third Regular Session 
HOUSE BILL NO. ______ 
Introduced by Representative LORDAN G. SUAN 
AN ACT 
LIBERALIZING THE LEASE OF LANDS BY FOREIGN INVESTORS, ESTABLISHING 
THE STABILITY OF LONG-TERM LEASE CONTRACTS, AMENDING FOR THE 
PURPOSE REPUBLIC ACT NO. 7652, OTHERWISE KNOWN AS THE "INVESTORS' 
LEASE ACT" 
EXPLANATORY NOTE 
The government recognizes that foreign investments are critical in 
achieving vital development goals such as creating jobs, stimulating the 
economy, transferring technology, expanding market access, developing 
infrastructure, and generating tax revenue. 
To attract foreign investors, the government has enacted several laws: (1) 
the Public Service Act (PSA) Amendatory Law (RA 11659); (2) the Foreign 
Investments Act (FIA) Amendatory Law (RA 11647); (3) the Retail Trade 
Liberalization Act (RTLA) Amendatory Law (RA 11595); and the Corporate 
Recovery and Tax Incentives for Enterprises (CREATE) Law (RA 11534). 
To further encourage foreign investments in the Philippines, the Investors' 
Lease Act (RA 7652) was enacted. This law provides a legal framework for long-
term leases of private lands for foreign investors, increasing the lease period to 
a total of 75 years from the original 50 years provided by Presidential Decree No. 
471 (PD 471) which applied to all foreigners.However, over the years, the Act has 
faced criticisms for its relatively short lease periods and certain restrictions that 
have hindered foreign investors' confidence. To address these shortcomings and 
create a more conducive investment climate, this proposed amendment seeks 
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August 20, 2024
6:10 pm


2 
to liberalize the leasing of lands by foreign investors and establish the stability of 
long-term lease contracts. 
One of the most significant changes proposed in the amendment is the 
extension of the maximum lease period from 75 years to 99 years. This 
substantial increase in the lease duration provides investors with greater 
certainty and security, allowing them to make long-term investments and plan 
for their operations with confidence. By offering such extended lease periods, 
the Philippines can compete more effectively with other countries that have 
similar investment incentives. 
Furthermore, the amendment includes agriculture among the priority 
productive endeavors eligible for long-term leases. This recognition of the 
importance of agriculture in the Philippine economy is timely, as the country 
seeks to modernize its agricultural sector and attract foreign investment in this 
area. By allowing foreign investors to lease lands for agricultural purposes, the 
amendment can contribute to increased food production, rural development, 
and job creation. 
Another key provision in the amendment is the allowance for subleasing 
with the lessor's consent. This flexibility can enhance the efficiency of land use 
and 
promote 
economic 
activity. 
The 
amendment 
can 
encourage 
entrepreneurship and create additional business opportunities by enabling 
lessees to sublease portions of their leased properties. 
To ensure the security and enforceability of lease contracts, the 
amendment requires the registration of both lease and sublease contracts with 
the Registry of Deeds. This will provide public notice of the lease arrangements 
and protect the rights of both investors and landowners.  
In light of the preceding, this bill’s approval is fervently sought. 
LORDAN G. SUAN 
Cagayan de Oro City – 1st District 


Republic of the Philippines 
House of Representatives 
Quezon City, Metro Manila 
1 
Nineteenth Congress 
Third Regular Session 
HOUSE BILL NO. ______ 
Introduced by Representative LORDAN G. SUAN 
AN ACT 
LIBERALIZING THE LEASE OF LANDS BY FOREIGN INVESTORS, ESTABLISHING 
THE STABILITY OF LONG-TERM LEASE CONTRACTS, AMENDING FOR THE 
PURPOSE REPUBLIC ACT NO. 7652, OTHERWISE KNOWN AS THE "INVESTORS' 
LEASE ACT" 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
SECTION 1. Section 2 of Republic Act No. 7652, otherwise known as the 
1 
"Investors' Lease Act", is hereby amended to read as follows: 
2 
"SEC. 2. Declaration of Policy. - It is hereby declared the 
3 
policy of the State to encourage foreign investments consistent 
4 
with the constitutional mandate to conserve and develop our own 
5 
patrimony. Towards this end, the State hereby adopts a flexible and 
6 
dynamic policy on the granting of long-term lease on private lands 
7 
to foreign investors for the establishment of industrial estates, 
8 
factories, 
assembly 
or 
processing 
plants, 
agro-industrial 
9 
enterprises, land development for industrial[,] or commercial use, 
10 
tourism, AGRICULTURE, and other similar priority productive 
11 
endeavors. 
12 
IT IS THE POLICY OF THE STATE TO ENSURE THE RELIABILITY 
13 
OF INVESTORS' LEASE CONTRACTS TO GUARANTEE STABILITY AND 
14 
RETURN OF INVESTMENT." 
15 
SECTION 2. Section 4 of Republic Act No. 7652 is hereby amended to read 
16 
as follows: 
17 
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2 
 
1 
"SEC. 4. Coverage. - Any foreign investor investing in the 
2 
Philippines shall be allowed to lease private lands in accordance 
3 
with the laws of the Republic of the Philippines subject to the 
4 
following conditions: 
5 
(1) [No] THE AGGREGATE PERIOD OF THE lease contract shall 
6 
[be for a period] NOT exceed[ing fifty (50) years, renewable once 
7 
for a period of not more than twenty-five (25) years] NINETY-NINE 
8 
(99) YEARS; 
9 
(2) The leased area shall be used solely for the purpose of the 
10 
investment upon the mutual agreement of the parties; 
11 
(3) The leased premises shall comprise such area as may 
12 
reasonably be required for the purpose of the investment subject 
13 
however to the Comprehensive Agrarian Reform Law and the Local 
14 
Government Code; 
15 
(4) THE FOREIGN INVESTOR HAS AN APPROVED OR 
16 
REGISTERED INVESTMENT UNDER REPUBLIC ACT NO. 11534, 
17 
OTHERWISE KNOWN AS THE "CORPORATE RECOVERY AND TAX 
18 
INCENTIVES FOR ENTERPRISES ACT", REPUBLIC ACT NO. 7042, 
19 
OTHERWISE KNOWN AS THE "FOREIGN INVESTMENTS ACT OF 
20 
1991", AS AMENDED, AND UNDER OTHER RELEVANT LAWS, OR HAS 
21 
COMPLIED WITH THE REQUIREMENTS PRESCRIBED BY THE 
22 
APPROPRIATE INVESTMENT PROMOTION AGENCY (IPA) OR 
23 
GOVERNMENT AGENCY WHICH REGISTERS SPECIFIC INVESTMENT 
24 
ENTITIES AND/OR CLASSES OF PERSONS PURSUANT TO EXISTING 
25 
LAWS; 
26 
(5) THE LEASE CONTRACTS SHALL BE REGISTERED WITH THE 
27 
REGISTRY OF DEEDS OF THE PROVINCE OR CITY WHERE THE LEASED 
28 
AREA IS LOCATED AND ANNOTATED ON THE TITLE TO THE LAND; 
29 
AND 
30 
(6) THE REGISTER OF DEEDS SHALL REGISTER A LONG-TERM 
31 
LEASE CONTRACT UPON COMPLIANCE WITH THE FOLLOWING 
32 
CONDITIONS: 
33 
(A) THE INVESTOR PRESENTS PROOF OF AN APPROVED 
34 
AND/OR REGISTERED INVESTMENT UNDER SUBPARAGRAPH 4 
35 
HEREOF; 
36 


 
3 
(B) THE DATE OF COMMENCEMENT AND MAXIMUM 
1 
DURATION OF THE LEASE ARE CERTAIN; 
2 
(C) THE EXACT LOCATION, METES, AND BOUNDS OF THE 
3 
PROPERTY SUBJECT OF THE LEASE ARE IDENTIFIED; AND 
4 
(D) THERE IS A PROVISION IN THE LEASE CONTRACT 
5 
PROVIDING FOR ITS TERMINATION FOR FAILURE TO COMMENCE 
6 
THE INVESTMENT PROJECT WITHIN THREE (3) YEARS FROM 
7 
SIGNING OF THE CONTRACT. 
8 
The leasehold right acquired under long-term lease contracts 
9 
entered into pursuant to this Act may be sold, transferred, or 
10 
assigned, OR MAY SERVE AS SECURITY FOR A LOAN: Provided, That 
11 
when the buyer, transferee, or assignee is a foreigner or a foreign-
12 
owned enterprise, the conditions and limitations in respect to the 
13 
use of the leased property as provided for under this Act shall 
14 
continue to apply." 
15 
SECTION 3. A new Section 4-A is hereby inserted after Section 4 of 
16 
Republic Act No. 7652, to read as follows: 
17 
"SEC. 4-A. OPERATIVE ACT OF REGISTRATION. - THE 
18 
REGISTRATION OF THE LONG-TERM LEASE CONTRACT SHALL BE 
19 
THE OPERATIVE ACT THAT RENDERS THE LEASE BINDING AGAINST 
20 
THIRD PERSONS. REGISTRATION SHALL BE MADE IN ACCORDANCE 
21 
WITH THE PROVISIONS OF PRESIDENTIAL DECREE NO. 1529, AS 
22 
AMENDED. 
23 
THE REGISTERED LEASE CONTRACT SHALL NOT BE SUBJECT 
24 
TO COLLATERAL ATTACK. IT CANNOT BE ALTERED, MODIFIED, OR 
25 
CANCELLED EXCEPT IN A DIRECT PROCEEDING IN ACCORDANCE 
26 
WITH LAW." 
27 
SECTION 4. Section 5 of Republic Act No. 7652 is hereby amended 
28 
to read as follows: 
29 
"SEC. 5. Limitations. - (1) Foreign individuals, corporations, 
30 
associations, or partnerships not otherwise investing in the 
31 
Philippines as defined herein shall continue to be covered by 
32 
Presidential Decree No. 471 and other existing laws in lease of lands 
33 
to foreigners[.]; 
34 
(2) Withdrawal of the approved investment in the Philippines 
35 
within the period of the lease [agreement] CONTRACT entered into 
36 
under this Act, or use of the leased area for the purpose other than 
37 


 
4 
that authorized, shall warrant the ipso facto termination of the 
1 
lease [agreement] CONTRACT without prejudice to the right of the 
2 
lessor to be compensated for the damages [he] THE LESSOR may 
3 
have suffered thereby[.]; 
4 
(3) Any lease agreement under this Act which is renewable 
5 
at the option of the lessee subject to the same terms and conditions 
6 
of the original contract shall be interpreted to mean as renewable 
7 
upon the mutual agreement of the parties[.];  
8 
(4) In addition to the conditions for the renewal of a lease 
9 
agreement [after the period of fifty (50) years as provided herein], 
10 
the foreign lease shall show that it has made social and economic 
11 
contributions to the country[.]; AND  
12 
(5) In the case of tourism projects, lease of private lands by 
13 
foreign investors qualified herein shall be limited to projects with 
14 
an investment of not less than five million (5M) US dollars, seventy 
15 
percent (70%) of which shall be infused in said project within three 
16 
years from the signing of the lease contract." 
17 
SECTION 5. A new Section 5-A is hereby inserted after Section 5 of 
18 
Republic Act No. 7652, to read as follows: 
19 
"SEC. 5-A. SUBLEASE. - UNLESS THERE IS AN EXPRESS 
20 
PROHIBITION IN THE CONTRACT, THE LESSEE MAY SUBLET THE 
21 
PROPERTY WITH THE CONSENT OF THE LESSOR. THE CONDITIONS 
22 
UNDER SECTION 4 OF THIS ACT SHALL APPLY TO THE SUBLEASE 
23 
CONTRACT." 
24 
SECTION 6. A new Section 5-B is hereby inserted after the new Section 5-
25 
A of Republic Act No. 7652, to read as follows: 
26 
"SEC. 5-B. REGISTRATION OF SUBLEASE CONTRACTS. - 
27 
SUBLEASE CONTRACTS WITH A TERM OF TWENTY-FIVE (25) YEARS 
28 
OR MORE SHALL BE REGISTERED WITH THE REGISTRY OF DEEDS 
29 
AND ANNOTATED ON THE TITLE TO THE LAND. SUBLEASE 
30 
CONTRACTS WITH A TERM OF LESS THAN TWENTY-FIVE (25) 
31 
YEARS ARE EXEMPT FROM MANDATORY REGISTRATION BUT MAY 
32 
BE REGISTERED VOLUNTARILY FOR LEGAL PROTECTION AND 
33 
PUBLIC NOTICE." 
34 
SECTION 7. Section 6 of Republic Act No. 7652 is hereby amended to read 
35 
as follows: 
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5 
"SEC. 6. Termination of Lease Contract. – [The Secretary of 
1 
Trade and Industry shall terminate any lease contract entered into 
2 
under the provisions of this Act, if the investment project is not 
3 
initiated within three (3) years from the signing of the lease 
4 
contract.] FAILURE TO INITIATE THE INVESTMENT PROJECT WITHIN 
5 
THREE (3) YEARS FROM THE SIGNING OF THE LEASE CONTRACT 
6 
SHALL TERMINATE THE LEASE, REVOKE ALL ENTITLEMENTS 
7 
GRANTED UNDER THIS ACT, AND CAUSE THE AUTOMATIC 
8 
REVERSION OF THE PROPERTY TO THE LESSOR OR LANDOWNER." 
9 
SECTION 8. Section 7 of Republic Act No. 7652 is hereby amended to read 
10 
as follows: 
11 
"SEC. 7. Penal Provision. - Any contract [or agreement] made 
12 
or executed in violation of any of the following prohibited acts shall 
13 
be null and void ab initio and both contracting parties shall be 
14 
punished by a fine of not less than [One hundred thousand pesos 
15 
(P 100,000)] ONE MILLION PESOS (PHP 1,000,000.00) [nor] BUT 
16 
NOT more than [One million pesos (P 1,000,000.00)] TEN MILLION 
17 
PESOS (PHP 10,000,000.00), or imprisonment of six (6) months to 
18 
six (6) years, or both, at the discretion of the court: 
19 
(1) Any provision in the lease [agreement] CONTRACT 
20 
stipulating a lease period in excess of that provided in paragraph (1) 
21 
of Section 4; 
22 
(2) Use of the leased premises for the purpose contrary to 
23 
existing laws of the land, public order, public policy, morals, or good 
24 
customs; 
25 
(3) Any agreement [or agreements] resulting [is] IN the lease 
26 
of land in excess of the [area] approved AREA [by the DTI]: Provided, 
27 
That, where the excess of the totality of the area leased is due to 
28 
the acts of the lessee, the lessee shall be held solely liable therefor 
29 
[Provided, further, That, in the case of corporations, associations, or 
30 
partnerships, the president, manager, director, trustee or officers 
31 
responsible for the violation hereof shall bear the criminal liability]. 
32 
IN THE CASE OF CORPORATIONS, ASSOCIATIONS, OR 
33 
PARTNERSHIPS, THE PRESIDENT, MANAGER, DIRECTOR, TRUSTEE, 
34 
OR RESPONSIBLE OFFICERS SHALL BE HELD CRIMINALLY LIABLE. 
35 
THE PENALTIES PROVIDED UNDER THIS SECTION SHALL BE 
36 
APPLICABLE TO ALL SUBLEASE CONTRACTS." 
37 


 
6 
SECTION 9. Implementing Rules and Regulations. — Upon the effectivity 
1 
of this Act, the Board of Investments, the Fiscal Incentives Review Board, and the 
2 
Land Registration Authority, in consultation with other concerned government 
3 
agencies and stakeholders, shall promulgate the necessary implementing rules 
4 
and regulations for the effective implementation of this Act. 
5 
SECTION 10. Separability Clause. — If any provision of this Act is declared 
6 
unconstitutional, the remainder thereof not otherwise affected shall remain in 
7 
full force and effect. 
8 
SECTION 11. Repealing Clause. — All other laws, presidential decrees, 
9 
executive orders, letters of instruction, proclamations, or administrative 
10 
regulations that are inconsistent with the provisions of this Act are hereby 
11 
repealed, amended, or modified accordingly. 
12 
SECTION 12. Effectivity Clause. — This Act shall take effect after fifteen 
13 
(15) following its publication in the Official Gazette, or in a newspaper of general 
14 
circulation.
15 
Approved,