THIRTEENTH CONGRESS OF THE REPUBLIC 
) 
OF THE PHILIPPINES 
) 
First Regular Session 
) 
S E N A T E  
c 
Introduced by Senator S. R. OsmeAa Ill 
EXPLANATORY NOTE 
Republic Act No. 6657, otherwise known as the Comprehensive Agrarian 
Reform Law (CARL) was enacted to fortify the Constitutional mandate to promote 
comprehensive rural development and agrarian reform. 
The vision of CARL was to emancipate the farmer from the exploitative 
hold of the landlord. However, the failure to develop institutions that could take 
the place of the tenancy relationship has left the farmer isolated from markets for 
his products, and sources of production inputs such as credit and technology. 
Among its provisions, the CARL prohibits farmer beneficiaries from selling, 
transferring or conveying the land upon full payment thereof, and from 
mortgaging their rights to it during the period of time when full payment has not 
been conveyed. The objective of this provision is clearly to prevent farmer- 
beneficiaries from reversing the effects of agrarian reform by relinquishing 
ownership of the land through the sale or mortgage. 
However, this prohibition againsi mortgages on the CARL-subjected land 
has effectively dried up the credit market in the rural areas, and doomed the 
agricultural sector to a long spell of stagnation. 
This bill seeks to remedy this problem by allowing farmer-beneficiaries to 
sell, transfer, convey, lease, usufruct or mortgage the land. In this manner, the 
farmer-beneficiary is being given the economic decision on what to do with the 
land awarded to him. Farmer-beneficiaries are allowed to dispose of their entire 
awarded land or parts thereof. This will remove the restriction of the Department 
of Agrarian Reform prohibiting the disposition of only a portion of the awarded 
land and thus allow the farmer to dispose of that part of land that will satisfy his 
financial needs. 
Also, lands which have already been redistributed pursuant to the 
Comprehensive Agrarian Reform Program, including those retained by the 
landowner may be sold, transferred or conveyed to any person, and said person 
shall no longer be subject to any limitation on the total area of lands he owns. 


The social justice principle had already been served with the redistribution of the 
lands. This will also allow the banks and other lenders to own lands, as a result 
of foreclosure, in excess of the 5-hectare limit. 
The goals of agricultural modernization and rural development can only 
become feasible in a free market environment where individuals have freedom of 
choice in their investment and production decisions. The strictures imposed by 
the CARL stand in the way of such an environment obtaining in rural markets. 
In view of the foregoing, early passage of this bill is earnestly requested. 
S E ~ G I O  
OSMENA III 
Senator 
2 


”j% JJi 30 p 2 3 6  
THIRTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
) 
First Regular Session 
) 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
Introduced by Senator S. R. Osmeiia Ill 
AN ACT 
AMENDING CERTAIN SECTIONS OF REPUBLIC ACT NUMBERED 6657, 
OTHERWISE KNOWN AS “THE COMPREHENSIVE AGRARIAN REFORM 
LAW OF 1988”, AS AMENDED, AND FOR OTHER PURPOSES 
Be it enacted by the House of Representatives and the Senate of the Republic of 
the Philippines in Congress assembled: 
SECTION 1. Section 2 of Republic Act No. 6657, otherwise known as the 
Comprehensive Agrarian Reform Law of 1988, is hereby amended to read as 
follows: 
“SEC. 2. Declaration of Principles and Policies. - It is the 
policy of the State to pursue a Comprehensive Agrarian Reform 
Program .(CARP). 
The welfare of the landless farmers and 
farmworkers will receive the highest consideration to promote social 
justice and to move the nation toward sound rural development and 
industrialization, and the establishment of owner cultivatorship of 
economic-size farms as the basis of Philippine agriculture. 
“To this end, a more equitable distribution and ownership of 
land, with due regard to the rights of landowners to just 
compensation and to the ecological needs of the nation, shall be 
undertaken to 
provide farmers and farmworkers with the 
opportunity to enhance their dignity and improve the quality of their 
lives through greater productivity of agricultural lands. 
1 


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
“Th.e agrarian reform program is founded on the right of 
farmers and regular farmworkers, who are landless, to own directly 
or collectively the lands they till or, in the case of other 
farmworkers, to receive a just share of the fruits thereof. To this 
end, the State shall encourage and undertake the just distribution of 
all agricultural lands, subject to the priorities and retention limits set 
forth in this Act, taking into account ecological, developmental, and 
equity considerations, and subject to the payment of just 
compensation. 
The State shall respect the right of small 
landowners, and shall provide incentives for [voluntary land- 
sharing] THE USE OF MECHANISMS FOR THE COLLECTIVE 
SHARING OF BENEFITS AND 
RESOURCES, INCLUDING 
COOPERATIVE AND CORPORATIVE FARMING. 
X X X I I  
SEC. 2. Section 6 of the same law is likewise hereby amended to read as 
follows: 
“SEC. 6. Retention Limits. -- Except as otherwise provided 
in this Act, no [person] LANDOWNER may own or retain, directly or 
indirectly, any public or private agricultural land, [the size of which 
shall vary according to factors governing a viable family-size farm, 
such as commodity produced, terrain, infrastructure, and soil fertility 
as determined by the Presidential Agrarian Reform Council (PARC) 
created hereunder, but in no case shall retention by the landowner] 
WHICH exceeds five (5) hectares. Three (3) hectares may be 
awarded to each child of the landowner, subject to the following 
qualifications: (I) that he is at least fifteen (15) years of age; and (2) 
that he is actually tilling the land or directly managing the farm: 
Provided, That landowners whose lands have been covered by 
Presidential Decree NO. 27 shall be allowed to keep the area 
L 


1 
2 
3 
4 
5 
said homestead. 
6 
x x x” 
7 
8 
as follows: 
9 
“SEC. 27. Transferability of Awarded Lands. -- Lands, OR 
10 
PARTS THEREOF, acquired by beneficiaries under this Act may 
11 
[not] 
be 
sold, transferred, [or] 
conveyed, 
LEASED, OR 
12 
USUFRUCTED TO ANY PERSON, NATURAL OR JURIDICAL. 
13 
[except through hereditary succession, or to the government, or to 
14 
the LBP, or to other qualified beneficiaries for a period of ten (IO) 
15 
years: Provided, however, That the children or the spouse of the 
16 
transferor shall have the right to repurchase the land from the 
17 
government or LBP within a period of two (2) years. Due notice of 
18 
the availability of the land shall be given by the LBP to the 
19 
Barangay Agrarian Reform Committee (BARC) of the barangay 
20 
where the land is situated. 
The Provincial Agrarian Reform 
21 
Coordinating Committee (PARCCOM) as herein provided, shall, in 
22 
turn, be given due notice thereof by the BARC.] 
23 
“THE SALE, TRANSFER, OR CONVEYANCE OF THE 
24 
LANDS SHALL NOT REQUIRE THE APPROVAL OF THE DAR: 
25 
PROVIDED, THAT THE DAR SHALL BE INFORMED AND GIVEN 
26 
A COPY OF THE AGREEMENT OF SUCH SALE, TRANSFER OR 
27 
CONVEYANCE. 
28 
29 
originally retained by them thereunder: Provided, further, That 
original homestead grantees or their direct compulsory heirs who 
still own the original homestead at the time of the approval of this 
Act shall rktain the same areas as long as they continue to cultivate 
SEC. 3. Section 27 of the same law is likewise hereby amended to read 
“[If the land has not yet been fully paid by the beneficiary, the 
rights to the land may be transferred or conveyed, with prior 
3 


1 
approval of the DAR, to any heir of the beneficiary or to any other 
2 
beneficiary who, as a condition for such transfer or conveyance, 
3 
shall cultivate the land himself. Failing compliance herewith, the 
4 
land shall be transferred to the LBP, which shall give due notice of 
5 
the availability of the land in the manner specified in the 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
I 9  
20 
21 
22 
23 
24 
25 
26 
27 
28 
immediately preceding paragraph] 
“[In the event of such transfer to the LBP, the latter shall 
compensate the beneficiary in one lump sum for the months the 
latter has already paid, together with the value of improvements he 
has made on the land.]” 
Sec. 4. A new section is hereby inserted after Section 27, to be 
designated as Section 27-A, to read as follows: 
“SEC. 27-A. AWARDED LAND AS COLLATERAL. -- THE 
LAND AWARDED TO THE FARMER-BENEFICIARY MAY BE 
MORTGAGED TO ANY PERSON, NATURAL OR JURIDICAL. 
“IN THE EVENT OF DEFAULT BY THE FARMER- 
BENEFICIARY, THE MORTGAGEE MAY FORECLOSE ON THE 
LAND SUBJECT TO EXISTING LAW: PROVIDED, THAT THE 
FARMER-BENEFICIARY SHALL HAVE THE RIGHT TO REDEEM 
THE LAND WITHIN TWO (2) YEARS. 
“LANDS WHICH HAVE ALREADY BEEN SUBJECTED TO 
REDISTRIBUTION UNDER THE COMPREHENSIVE AGRARIAN 
REFORM PROGRAM INCLUDING LANDS RETAINED BY THE 
ORIGINAL LANDOWNER SUBJECT TO RETENTION LIMITS IN 
SECTION 6, MAY BE SOLD, TRANSFERRED OR CONVEYED 
TO ANY. PERSON AND SUCH PERSON SHALL NOT BE 
SUBJECT TO ANY LIMITATION ON THE TOTAL AREA OF 
LANDS HE MAY OWN.” 
4 


I 
SEC. 5. A new section after Section 27 is hereby inserted, to be 
2 
3 
4 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
designated as Section 27-B, to read as follows: 
“SEC. 27-B. 
MORTGAGE OR SALE OF CULTIVATION 
RIGHTS. -- THE FARMER-BENEFICIARY MAY MORTGAGE OR 
SELL HIS CULTIVATION RIGHTS OVER THE LAND TO ANY 
PERSON. 
“IN CASE OF DEFAULT, THE MORTGAGEE MAY 
ASSUME THE CULTIVATION RIGHTS OVER THE LAND.” 
SEC. 6. Section 70 of the same law is hereby amended to read as 
follows: 
“Sec. 70. Disposition of Private Agricultural Lands. -- [The 
sale or disposition of agricultural lands retained as a consequence 
of Section 6 hereof shall be valid as long as the total landholdings 
that shall be owned by the transferee thereof inclusive of the land to 
be acquired shall not exceed the landholding ceilings provided for 
in this Act.] 
x x x  
“[Transferees of agricultural 
lands 
shall 
furnish the 
appropriate Register of Deeds and BARC an affidavit attesting that 
his total landholdings as a result of the said acquisition do not 
exceed the landholding ceiling. The Register of Deeds shall not 
register the transfer of any agricultural land without submission of 
this sworn statement with the proof of service of a copy thereof to 
the BARC.] 
SEC. 7. 
Sec. 73 of the same law is likewise amended to read as 
follows: 
“SEC. 73. Prohibited Acts and Omissions. -- The following 
are prohibited: 
5 


1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 
26 
27 
28 
29 
“(a) The ownership or possession, for the purpose of 
circumventing the provisions of this Act, of agricultural lands in 
excess of the total retention limits or award ceilings by any 
person, natural or juridical, except those under collective 
ownership by farmer-beneficiaries AND THOSE PURSUANT 
TO SECTION 27-A HEREOF. 
x x x  
“[(f) 
The sale, transfer or conveyance by a beneficiary of the 
right to use or any other usufructuary right over the land he 
acquired by virtue of being a beneficiary, in order to circumvent 
the provisions of this Act.] 
SEC. 8. Within sixty (60) days from the effectivity of this Act, the 
Department of Agrarian Reform (DAR) shall draft the necessary rules and 
regulations (IRR) to implement the provisions of this Act. Said IRR shall be 
submitted to the Congressional Oversight Committee (COC) which shall review, 
revise and approve the same within a period of sixty (60) days from the date of 
receipt thereof after which the DAR shall promulgate the IRR. 
SEC. 9. There is hereby created a Congressional Oversight Committee 
(COC) to be headed 
the Chairs of the Committee on Agrarian Reform of both 
Houses, and composed of four (4) other members from the Senate and four (4) 
other members from the House of Representatives, who shall be appointed by 
the Senate President and the Speaker of the House of Representatives, 
respectively, based on proportional representation: Provided, that at least two (2) 
of the members from both the Senate and from the House of Representatives 
shall come from the minority: Provided, further, that after the COC has approved 
the IRR, it shall thereafter become functus officio, and therefore cease to exist. 
SEC. 10. All laws, decrees, executive orders, rules and regulations, or 
parts hereof inconsistent with the prcvision of this Act are hereby repealed, 
amended or modified accordingly. 
6 


1 
SEC. 11. 
This Act shall take effect fifteen (15) days following its 
2 
publication 
in 
at 
least 
two 
(2) 
newspapers of 
general 
circulation. 
Approved, 
7