Here we have
some Basic Information On Property Ownership In The Philippines
Owning
Property By Foreigners
Owning
Property By Former Filipinos
General
Rules of Holding or Owning Real Estate
Erstwhile
Filipino Citizens' Reacquisition of Rights And Privileges of 2004
The Laws
Requirements
For Land Registration or original Certificate of Title (Judicial Titling)
Requirements
For Land Transfer or Transfer Certificate of Title
Acquisition
By Former Natural-Born Filipino Citizens
Stewardship Concept of Ownership
Fee
Simple
Lands of The Public Domain
Rights
of Accession
Hidden Treasure
Meaning
of “Title”
Modes of Acquiring Title
Limitations to Bundle of Rights
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Philippines
Property Primer
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Ultimate
guide in buying, investing and managing property in the
Philippines
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You are taking the first step in finding out how
to purchase, lease or rent property in the Philippines. |
http://www.census.gov.ph/index.html
http://www.census.gov.ph/data/civilreg/civapfaq.html
Owning
Property By Foreigners
Every
foreigner who has tried to buy property or just wanted to open a bank
account in the Philippines has received a somewhat nasty surprise: It not
allowed for foreigners to own something in the Philippines, if not a
Filipino partner is available as well. Basically this means that either
both share the property with equal rights, or the Filipino owns 51% or
more, and the foreigner owns 49 % and less.
Ok,
so you think that this is not a major problem? You are married to your
beautiful Filipina wife, and that solves the problem of the Filipino
participation anyway. Well, be warned. Divorce may not be permitted in the
Philippines, but there it is allowed in most other countries. So if you
happen to split with your wife, and you did not provide for some method to
guarantee your property, you might loose it.
So
what can you do? You can arrange for an additional contract certified by a
lawyer that guarantees that your partner will never be able to do anything
with her/his part of the property without your explicit consent. You paid
100 percent anyway, so that kind of contract is quite normal in the
Philippines.
Owning
of houses
or buildings
is possible as well, as long as the foreigner does not own the land on
which the house is build. The land though can be leased by the foreigner
on a long-term contract, and the house can be legally his.
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Owning property by former Filipinos
Now
for a different issue. You are a Filipina, and you have managed to buy
some land in your home country, and you have secured the life of your
family on that piece of land. Now you have decided to change your
citizenship to that of the country where you are living. The advantages
are clear: No more travel tax for your trips to the Philippines, and no
more visa requirements when you travel around the world. But what happens
to your property? Now you cannot own it anymore?
Well,
you are lucky. Sometimes the Philippine government actually does something
right. All of the property that you owned in the Philippines before you
gave up your Philippine citizenship you can keep without any problems. You
can even buy property within limits as a former Philippine citizen. There
is only one drawback. As a former Filipino
you can only buy additional property up to the limits mentioned below. So
if you already own more than 1000 sqm of land for housing, there is no
possibility to buy any more land.
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General
Rules of Holding or owning Real Estate
- General
Rule – only Filipino citizens and corporations at least sixty
percent of the capital of which is owned by Filipino are entitled to
acquire and own land in the Philippines.
- 2.
Exceptions to General Rule – Alien acquisition of real estate in the
Philippines is allowed in the following cases:
a)
Acquisition before the 1935 Constitution;
b)
Acquisition thru hereditary succession if the alien acquires is a
legal heir.
c)
Purchase of not more than forty percent interest in a condominium
project.
d)
Purchase by former natural-born Filipino citizens subject to the
limitations prescribed by law (Batas Pambansa 185 and R.A. 8179).
- A
Filipino who marries an alien retains her Philippine citizenship
(unless by her act or omission she is deemed to have renounced
Philippine citizenship), and may therefore acquire real estate in the
Philippines.
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Erstwhile
Filipino Citizens' Reacquisition of Rights and Privileges of 2001
An
act allowing natural-born citizen as the Philippines who have lost their
Filipino citizenship to retail certain rights and privileges, subject to
certain constitutional limitations and for other purposes.
This
act was proposed and passed in the Philippine government in 2004, so it is
valid law.
(HB00081,HB00330,HB01238,HB01771,HB02531,HB03369,HB03370).
The idea in this proposals is to make certain privileges available to
former natural born Filipinos. The above mentioned proposal allows former
Filipinos to:
·
Operation
of Rural Banks
·
Engaging
in retail business
·
Operation
of overseas shipping
·
Engaging
in the rice and corn industry
·
Private
employment without need of any government permit
·
Engaging
in the tax-free industries
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Contracts
for supply for the government
·
Engaging
in the brokerage business
·
Practice
of certain profession
As
soon as there are changes in the Philippine law, this page will be updated
to reflect the new changes.
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The
Law
Just
read the following official statements:
The
Laws on Land Ownership by former Filipinos
Article
XII, Section 8,
of the Philippine Constitution provides that a natural born citizens of
the Philippines who has lost his or her Philippine citizenship may be a
transferee of private lands, subject to limitations provided by law.
Section 7 of the same Article entitles
former Filipinos to own and acquire lands through hereditary succession,
i.e. by virtue of inheritance.
The laws on land
ownership by natural-born Filipinos who have lost their Philippine
citizenship are governed by Batas Pambansa Blg. 185 (BP 185), which was
enacted in March 1982, and Republic Act 8179 (RA 8179), which amended the
Foreign Investment Act of 1991. The following are the provisions of BP 185
and RA 7042, as amended by RA 8179, pertinent to land ownership by former
Filipinos:
PARTICULARS
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PROVISIONS
UNDER BP 185
(Applies to acquisition of land for purposes of residence)
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PROVISIONS
UNDER RA 7042 AS AMENDED BY RA 8179
(Applies to acquisition of land for purposes of business or
commerce)
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Size/Area
Coverage
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Maximum
of 1000 sq. meters for urban land
Maximum
of one (1) hectare for rural land
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Maximum
of 5000 sq. meters for urban land
Maximum
of three (3) hectares for rural land
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Land
Acquisition for Both Spouses
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Either
of the spouses may avail of this privilege
In
case both spouses wish to acquire lands for this purposes, the
total area acquired should not exceed the maximum
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Either
of the spouses may avail of this privilege
In
case both spouses wish to acquire lands for this purposes, the
total area acquired should not exceed the maximum
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Additional
Land Acquisition
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In
case he/she already owns urban or rural lands for residential
purposes, he/she may acquire additional urban or rural lands,
which when added to those he/she presently owns shall not exceed
the authorized maximum area.
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In
case he/she already owns urban or rural lands for business
purposes, he/, she may acquire additional urban or rural lands
which when added to those he/she presently owns shall not exceed
the authorized maximum area.
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Limits
to Acquisition of Land
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A
person may acquire not more that two (2) lots which should be
situated in different municipalities or cities anywhere in the
Philippines, provided that the total area of those lots do not
exceed 1,000 sq. meters for urban land or one (1) hectare for
rural land for use as residence. An individual who has already
acquired urban land shall be disqualified from acquiring rural
land and vice versa.
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A
person may acquire not more that two (2) lots which should be
situated in different municipalities or cities anywhere in the
Philippines, provided that the total area of those lots do not
exceed 5,000 sq. meters for urban land or three (3) hectares for
rural land for use as residence.
Under
Section 4 of Rule XII of the Implementing Rules and Regulations of
RA 704 as amended by RA 8179, a transferee who has already
acquired urban land shall be disqualified from acquiring rural
land and vice versa. However, if the transferee has disposed of
his rural land, he may still acquire rural land and vice versa,
provided that this will be used for business.
A
transferee of residential land acquired under Batas Pambansa Blg.
185 may still avail of the privilege granted under this law.
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Use
of Land
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The
acquired land should not be used for any purpose other than for
his/her residence.
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Section
5 of Rule XII specifically states that “the land should be
primarily, directly and actually used in the performance or
conduct of the owner’s business or commercial activities in the
broad areas of agriculture, industry and services including the
lease of land but excluding the buying or selling thereof.
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Special
Requirements
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In
addition to the requirements provided for in other laws for the
registration of titles to lands, the transferee should submit to
the Register of Deeds of the province or city where the property
is located a sworn statement showing the following:
Date
and place of birth
Names
and addresses of his/her parents, his/her spouse, and children, if
any;
The
area, location, and mode of acquisition of his/her landholdings in
the Philippines, if any;
His/her
intention to reside permanently in the Philippines;
Date
he/she lost his/her Philippine citizenship and the country of
which he/she is presently a citizen.
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In
addition to the usual registration requirements pertinent to the
conveyance of real estate, the transfer contemplated shall not be
recorded unless the transferee submits to the Registry of Deeds of
the province or city where the land is situated, the following:
Certification
of business registration issued by the Bureau of Trade Regulation
and Consumer Protection of the Department of Trade and Industry;
Sworn
statement same as that in BP 185;
Certification
from the assessor of the municipality or province where the
property is situated that the subject land for transfer is in an
urban or rural area;
If
an agricultural land is acquired, a certification from the
Department of Agrarian Reform that the land is a retained area of
the transferor and an affidavit of the transferee attesting that
his total landholdings inclusive of the land to be acquired does
not exceed the 5-hectare limit fixed by RA 6657 (the Comprehensive
Agrarian Reform Act – CARP).
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Requirements
For Land Registration or original Certificate of Title (Judicial Titling)
The
application for land registration should be filed in triplicate with the
Clerk of the Regional Trial Court of the province/city where the property
is located. The following documents should be attached to the application:
- The
original plan on tracing cloth duly approved by the Director of Lands
or Regional Land Director, or in lieu thereof, a true copy of the same
on a tracing cloth properly attested and certified by said office or
official authorized to make such certification, together with two (2)
print copies thereof;
- Technical
description, three (3) copies
- Surveyor’s
certificate, three (3) copies
- Certificate
of the assessed value of the property issued by the provincial
treasurer, in quadruplicate
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Requirements
For Land Transfer or Transfer Certificate of Title
The
following documents are required for the filing of land transfer:
- Copies
of the Deed of Absolute Sale
- Latest
real estate tax payments
- Latest
tax declaration of the property
- Certificate
from the Bureau of Internal Revenue that the capital gains tax and
documentary stamps have been paid
- Transfer
tax
- Receipt
of payment of the transfer and registration fees
- Owning
Property by Foreigners:
- No
foreigner is allowed to own property in the Philippines, as already
mentioned in the top section.
But
there are exceptions:
- Foreigners
are allowed to own property, especially land, by hereditary
succession. This simply means, when your Filipina wife dies, you as
the natural heir will become the legal owner of her property.
- The
same is true for the children, every natural child (legitimate or
illegitimate) can inherit the property for his/her Filipina mother,
even when the child does not have the Philippine citizenship.
- There
is one other exception: condominium
units and apartments.
These can be owned by any foreigner, provided that the alien
participation in the complete complex does not exceed 40% of value.
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Acquisition
By Former Natural- Born Filipino Citizens
- Mode
of acquisition is not limited to voluntary deeds (such as sale or
donation) but includes involuntary deeds (such as tax sale,
foreclosure sale, or execution sale).
- Maximum
area that may be acquired is as follows :
a)
For residential purpose – 1,000 square meters of urban land or
one hectare of rural land.
b)
For business purpose – 5,000 square meters of urban land or three
hectares of rural land.
- “Business
purpose” refers to the use of the land primarily, directly, and
actually in the conduct of business or commercial activities in the
broad areas of agriculture, industry and services, including the lease
of land, but excluding the buying and selling thereof.
- In
case of married couple where both spouses are former natural-born
Filipino citizens, one or both of them may avail of the privilege,
provided that the total acquisition shall not exceed the maximum area
allowed.
- A
transferee who already owns urban or rural land for residential
purpose acquired while still a Filipino citizen, may acquire
additional urban or rural land for residential purpose which, when
added to that already owned by him, shall not exceed the maximum area
allowed by law.
- The
same privilege applies to a transferee who already owns urban or rural
land for business purpose.
- A
transferee who already acquired urban land for residential purpose
shall be disqualified to acquire rural for residential purpose, and
vice-versa. The same rule applies to a transferee of land for business
purpose.
- However,
a transferee of residential land under B.P. 185 may still avail of the
privilege to acquire land for business purpose under R.A. 8179.
- For
registration of a conveyance in favor of the transferee, he must
submit to the
- Register
of Deeds a sworn statement on the following: date and place of birth;
name of parents, brothers, sisters, and spouse; location, area and
mode of acquisition of present landholding; date when he lost his
Philippine citizenship; and his present citizenship.
- For
transferees of land for residential purpose, the sworn statement shall
include his intention to reside permanently in the Philippines.
- For
transferees of land for business purpose , the sworn statement shall
include a declaration to use the land for business purpose.
Furthermore, the transferee shall submit a certification of business
name registration with the Bureau of Trade
- Regulation
and Consumer Protection. And in case the land is agriculture, he shall
likewise submit a certification from the Department of Agrarian Reform
that the land is a retained area of the transferor and an affidavit of
the transferee that the total landholding inclusive of the land to be
acquired does not exceed five hectares.
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Stewardship Concept of Ownership
Ownership
carries with it a social obligation. As stewards of their land, owners are
obliged to use their property to promote not only their interest but also
the general welfare. When a person’s landholding exceeds the requirement
of his needs, or his utilization is not conducive to general welfare, the
State may exercise its power to regulate and control ownership.
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Fee
Simple
This
refers to the “bundle of rights” or attributes which are inherent or
appurtenant to ownership, without any limitation or restriction other than
those imposed by law or contract. The bundle of rights includes the right
to use, to possess, to the fruits, to dispose, and to vindicate or
recover.
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Lands of The Public Domain
- Under
the Constitution, lands of the public domain are classified into
agricultural, forest or timber, mineral, and national parks.
- Alienable
lands of the public domain shall be limited to agricultural lands.
- Filipino
citizens may acquire alienable lands of the public domain not more
than twelve hectares by purchase , homestead , or patent ; or lease
not more than 500 hectares
- Private
corporations cannot acquire, but may only lease alienable lands of the
public domain for a period not exceeding twenty-five years, renewable
for the same term, and not to exceed 1,000 hectares
Rights
of Accession
- In
General – The ownership of property
gives the right by accession to everything which is produced thereby,
or which is incorporated or attached thereto, whether naturally or
artificially.
- With
Respect to Produce of Property – to the owner belongs the:
a)
Natural fruits – the spontaneous product of the soil.
b)
Industrial fruits – those produced by land cultivation or labor.
c)
Civil fruits – the rental income of buildings and/or lands.
- With
Respect to Immovable Property:
a)
The owner of land on which anything has been built, sown or planted
in good faith shall have the right :
i.
to appropriate as his own the works, sowing or planting after
payment of indemnity provided by law.
ii.
to oblige the builder or planter to pay the price of the land.
However, the builder or planter cannot be obliged to pay for the if its
value is considerably more than that of the building or planting. In such
case, he shall pay reasonable rent if the owner does not choose to
appropriate the building after proper indemnity. The parties shall agree
on the terms of the lease and in case of disagreement, the court shall fix
the terms thereof.
b)
The owner of the land on which anything has been built , planted or
sown in bad faith may :
i.
Demand and demolition of the work or removal of the planting or
sowing at the expense of the builder or planter, or
ii.
bb) Compel the builder or planter to pay the price of the land and
the sower, the proper rent.
c)
The landowner is also entitled to damages from the builder, planter
or sower.
i.
If there was bad faith on the part of the landowner and the
builder/planter/sower, the rights of the parties shall be the same as if
both had acted in good faith.
ii.
to the owners of land adjoining the banks of rivers belong the
accretion which they gradually receive from the effects of the current of
the water.
iii.
The owners of estates adjoining ponds or lagoons do not acquire the
land left dry by the natural decrease of the waters, or lose that
inundated by them in extraordinary floods.
iv.
River beds which are abandoned through the natural change in the
course of the waters belong to the owners whose lands are occupied by the
new bed in proportion to the are lost. However, the owner’s of the land
adjoining the old bed shall have the right to acquire the same by paying
the value of the area occupied by the new bed.
v.
Whenever a river, changing its course by natural causes, opens a
new bed through a private estate, the bed shall become a public dominion.
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Hidden
Treasure
- Hidden
treasure belongs to the owner of the land, building, other property on
which it is found.
- When
the discovery is made on the property of another, or of the State or
any of its subdivisions, and by chance, one-half of the treasure,
shall be allowed to the finder. If the finder is a trespasser, he
shall not be entitled to any share of the treasure.
- If
the things found be of interest to science or arts, the State may
acquire them at their just price, which shall be divided in conformity
with the rule above stated.
- Hidden
treasure, for legal purpose is understood to be any hidden and unknown
deposit of money, jewelry, or other precious objects, the lawful
ownership of which does not appear.
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Meaning
of “Title”
“Title”
is not synonymous with torrens Certificate of Title. Rather, it is a
generic word which means proof, evidence, or monument of ownership, such
as tax declaration, realty tax receipts, deed of sale, and torrens
Certificate of Title. But, of course, the best title or best evidence of
ownership is the torrens Title because it is indefeasible,
imprescriptibly, and binding against the whole world.
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Modes
of Acquiring Title
-
Private Grant -
voluntary transfer or conveyance of private property by a private
owner, such as sale or donation.
-
Public Grant –
acquisition of alienable lands of the public domain by homestead
patent, free patent, sales patent, or other government awards.
- Involuntary
Grant – acquisition of private party against the consent of the
former owner, such as foreclosure sale, execution sale, or tax sale.
- Inheritance
– acquisition of private property through hereditary succession.
- Reclamation
– filling of submerged land, subject to existing laws and government
regulations.
- Accretion
– acquisition of more lands adjoining the banks of rivers due to the
gradual deposit of soil as a result of the river current.
- Prescription
– acquisition of title by actual, open, continuous, and
uninterrupted possession in the concept of owner for the period
required by law.
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Limitations
to Bundle of Rights
- Legal
or Governmental Limitations:
a)
Zoning – refers to land use classifications and the allowable
utilization under each classification.
b)
Taxation – the power of the government or any of its political
subdivisions to impose charge or burden upon persons, property or property
rights for the use and support of the government.
c)
Eminent Domain – the power of the State or any of its
instrumentalities to take private property for public use and payment of
just compensation.
d)
Other provisions of law such as legal easement, the requirement of
legitime in succession, prohibition against sale and encumbrance of
property acquired by patent, rent control, laws on subdivision
development, urban and agrarian reform, etc.
- Contractual
or Voluntary Limitations:
Those imposed by
the grantor of the property to the grantee, either by contract (e.g.
donation), or by last will; or those imposed by the owner, himself such as
voluntary easement, mortgage, lease, use restrictions in subdivision
contracts, etc.
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