Republic of the Philippines
HOUSE OF REPRESENTATIVES,
Queson City

SEVENTEENTH CONGRESS
‘Second Regular Session

HOUSE BILL NO.G293

introduced by HON. LUIS RAYMUND “LRAY” F. VILLAFUERTE, JR.

EXPLANATORY NOTE

Many Filipino farmers were awarded land grants through the Agricultural Free Patents
(AFPs) with the passage of the Commonwealth Act No. 141, or the Public Land Act.
The passage of the Public Land Act as a landmark measure for a mechanism for land
ownership supported the productivity of the agricultural sector. However, despite the
awarding of AFPs to deserving farm entrepreneurs, the sector continues to face a lack
of access to credit due to the non-tradeable and non-bankable nature of the
agricultural land titles the law has promised.

Currently, those who hold AFPs are hindered by a five-year prohibition to
encumbrance and alienation. This restriction, under the Public Land Act, bar farm
owners from selling or loaning against it. These agricultural land titles in turn become
non-tradeable and non-bankable. These restrictions have caused uncertainty to
possible buyers resulting to a reluctance in improvements and additional investment
to these lands. Consequently, transactions for lands in the formal market are hindered
by these restrictions leaving the patentees vulnerable to lower prices and unregulated
informal credit suppliers.

This bill proposes to amend Section 44 of the Public Land Act and remove these
restrictions to make agricultural land titles immediately tradeable and bankable, among
other benefits. This bill would allow AFP grantees to legally capitalize on their awarded
land in the market. This would also allow them to acquire much needed capital in order
to enhance agricultural productivity and spur development of the sector.

The approval of this bill is eamestly sought.

LUIS UND \Y" F. VILLAFUERTE, JR.


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
Second Regular Session

House BILL No. 6293

Introduced by HON. LUIS RAYMUND “LRAY” F. VILLAFUERTE, JR.

AN ACT REMOVING THE RESTRICTIONS IN THE REGISTRATION OF LAND
TITLES UNDER SECTIONS 118, 119, AND OTHER RESTRICTIONS AGAINST
ENCUMBRANCE OR ALIENATION ON FREE PATENTS ISSUED UNDER
SECTION 44 OF COMMONWEALTH ACT NO. 141 OR THE PUBLIC LAND ACT,
AS AMENDED

Be it enacted by the Senate and House of Representatives of the Philippines
in Congress assembled:

SECTION 1. Short Tile. — This Act shall be known as the Agricultural Free Patent
Reform Act of 2017.

SECTION 2. Declaration of Policy. — \t is the policy of the State to remove the
restrictions on free patents to allow the efficient and effective utilization of these lands
to contribute to wealth creation, entrepreneurship, and economic development.

SECTION 3. Removal of Restrictions, — Agricultural public lands alienated or
disposed in favor of qualified public land applicants under Section 44 of
Commonwealth Act No. 141, as amended, shall not be subject to restrictions regarding
encumbrances, conveyances, transfers, or dispositions imposed under Sections 118
and 119 thereof. Agricultural free patent shall now be considered as title in fee simple
and shall not be subject to any restriction against encumbrance or alienation.

SECTION 4. Retroactive Effect. — This Act shall have retroactive effect and any
restriction regarding encumbrances, conveyances, or transfers, or dispositions
imposed on agricultural free patents issued under Section 44 of Commonwealth Act


No. 141, as amended, before the effectivity of the Act shall be removed and are hereby
immediately lifted.

SECTION 5. Repealing Clause. — All laws, decrees, orders, rules, and regulations, or
other issuances or parts thereof inconsistent with the provisions of this Act are hereby
repealed or modified accordingly.

SECTION 6. Separability Clause. - \f any portion or provision of the Act is declared
unconstitutional, the remainder of this Act or any provision not affected thereby shall
remain in force and effect.

SECTION 7. Effectivity Clause. - This Act shall take effect after fifteen (15) days
following completion of its publication either in the Official Gazette or in a newspaper

of general circulation in the Philippines.

Approved,