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REPUBLIC ACT NO. 7652
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AN ACT ALLOWING THE LONG-TERM LEASE

OF PRIVATE LANDS BY FOREIGN INVESTORS

Q:1) What are the purpose of the investors Lease Act?

A:) The purposes are as follows:

a.) To encourage foreign investments consistent with the constitutional
mandate to conserve and develop our own patrimony.
b.) To adopts a flexible and dynamic policy of the granting of long-term
lease on private lands to foreign investors for the establishment of
industrial estates, factories, assembly or processing plants, agro-
industrial enterprises, land development for industrial, or commercial
use, tourism, and other similar priority productive endeavors.

Q:2) What is meant by "Investing in the Philippines"?

A:) It shall mean making an equity investment in the Philippines through actual
remittance of foreign exchange or transfer of assets, whether in the form of
capital goods, patents, formulas, or other technological rights or processes, upon
registration with the Securities and Exchange Commission.

Q:) Who are those covered by the lease agreement?

A:) Any foreign investor investing in the Philippines shall be allowed to lease
private lands in accordance with the laws of the Republic of the Philippines.

Q:) Enumerate the conditions provided in the lease agreement entered into with
the foreign investors.

A:) (1) No lease contract shall be for a period exceeding fifty (50) years, renewable
once for a period of not more than twenty- five (25) years;

(2) The leased area shall be used solely for the purpose of the
investment upon the mutual agreement of the parties;

(3) The leased premises shall comprise such area as may reasonably be
required for the purpose of the investment subject however to the
Comprehensive Agrarian Reform Law and the Local Government Code.
Q:) Under what circumstances may ipso facto warrant the termination of the lease
agreement?

A:) (1) Withdrawal of the approved investment in the Philippines within the period
of the lease agreement entered into which shall mean either:
a) the failure to operate the investment project for any three (3)
consecutive years; or
b) outright abandonment of the investment project at any time during
the approved lease period.
(2) use of the leased area for the purpose other than that authorized.

Q:) Who shall effect the termination of lease?

A:) The Secretary of Trade and Industry shall terminate any lease contract entered
into under the provisions of this Act, if the investment project is not initiated
within three (3) years from the signing of the lease contract.

Q:) Enumerate the prohibited acts provided in the lease agreement.

A:) (1) Any provision in the lease agreement stipulating a lease period in excess of
that provided in paragraph (1) Section 4;

(2) Use of the leased premises for the purpose contrary to existing laws
of the land, public order, public policy, morals, or good customs;

(3) Any agreement or agreements resulting is the lease of land in

excess of the area approved by the DTI.

Q:) What is the effect if the prohibited act is violated?

A:) (1) Any contract or agreement made or executed in violation of any of

the preceding prohibited acts shall be null and void ab initio.

(2) Both contracting parties shall be punished by a fine of not less than
One Hundred thousand pesos (P100,000) nor more than One million pesos
(P1,000,000), or imprisonment of six (6) months to (6) years, or both, at the
discretion of the court.