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SECTION 28. Standing Crops at the Time of Acquisition

The landowner shall retain his share of any standing crops unharvest at the time
the DAR shall take possession of the land under Section 16 of the Act, and shall
be given a reasonable time to harvest the same.

28.1 Standing crop

Refers to harvestable agricultural produce or a portion thereof normally harvested
for such particular crop growing on land at the time the DAR takes possession
thereof
● In the case of lands planted to sugarcane and such other crops with
ratoons.
● Exists at the time of actual possession is already the first or second ratoon
crop

28.2 Payment to landowner completes acquisition process

● The payment to the landowner as evidenced by the Certification of Deposit
(COD) issued by the Land Bank of the Philippines (LBP) pursuant to Sec. 16
and 24 of the CARL signals the completion of the acquisition process over a
specific landholding

28.4 Taking of Possession Construed

● Refers to the explicit act/s of the DAR, through an ocular inspection or any
other acts by which the landowner is informed of DAR’s taking actual and
physical possession of a certain agricultural land acquired under CARP as
evidenced by a COD issued by the LBP pursuant to sec. 16 (e) and 24 of the
CARL

28.5 Standing crops not a hindrance to ARB’s exercise of right to possess

awarded land/s
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● The presence of standing crops shall not pose as a hindrance to the exercise
by the ARBS of their right of possession over the land awarded to them
through Certificates of Landownership Award (CLOAs) issued pursuant to
the CARL, regardless of wether or not an Order from the DAR directing the
physical possession of the land by ARBs has been secured.

28.6 Crops not yet harvestable deemed as plantings or sowings in good faith
Crops which are not yet harvestable and introduced by the former landowner
prior to the latter’s receipt of the corresponding notice or advice are considered
plantings or sowings in good faith
 Belong to the CLOA-title holders
 Entitled to reimbursement for the cost of plantings or sowings
 Payment thereof shall only be made after the CLOA-title holders obtained
the proceed from the initial harvest
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Chapter VIII Corporate Farms

SECTION 29. Farms Owned or Operated by Corporations or Other Business

Associations.
In the case of farms owned or operated by corporations or other business
associations, the following rules shall be observed by the PARC:
In general, lands shall be distributed directly to the individual worker-
beneficiaries.
In case it is not economically feasible and sound to divide the land
 Then it shall be owned collectively by the workers' cooperative or
association which will deal with the corporation or business association.
 Until a new agreement is entered into by and between the workers'
cooperative or association and the corporation or business association

29.1 Collective Ownership allowed under CARL

Collective ownership is permitted in two (2) provisions of the CARL.
Section 29 allows workers cooperatives or associations to collectively own the
land
Section 31 allows corporations or associations to own agricultural land with the
farmers becoming stock-holders or members
Cooperatives can be registered with the Cooperative Development Authority
(CDA) and acquire legal personality of their own.
Corporations are juridical persons under the Corporation Code of the Philippines
or Batas Pambansa Bilang 68
29.2 Rules governing farms owned or operated by business entities
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(a) In general, lands shall be distributed directly to the individual worker-

beneficiaries;
(b) In case it is not economically feasible and sound to divide the land, then it shall
be owned collectively by the workers cooperative or association which will deal
with the corporation or business association; and
(c) Until a new agreement is entered into by and between the workers cooperative
or association and the corporation or business association, any agreement existing
at the time the CARL takes effect between the former and the previous land
owner shall be respected by both the workers cooperative or association and the
corporation or business association.

29.3 Total Area to be awarded to co-owners, cooperative or collective

organization
Shall not exceed the total number of its members multiplied by the award
limit of three (3) hectares, except in meritorious cases as determined by PARC.
Title to the property shall be issued in the name of the co-owners or the
cooperative or collective organization as the case may be.
SECTION 30. Homelots and Farmlots for Members of Cooperatives.
The individual members of the cooperatives or corporations mentioned in
the preceding section shall be provided with homelots and small farmlots for their
family use, to be taken from the land owned by the cooperative or corporation.

30.1 Provision of homelots for family use to individual members

Shall be provided with homelots and small farmlots for the use of their
families which shall be taken from the land owned by the cooperative or
corporation
30.2 Homelot defined
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Refers to a lot suitable for dwelling with an area of not more than three
percent (3%) of the area of the land-holding provided that it does not exceed one
thousand (1000) square meters and that it shall be located at a convenient and
suitable place within the land of the landholder to be designed by the latter,
where the tenant shall construct his dwelling.
30.3 Where homelot is situated in retained area
An ARB may be awarded the homelot he actually occupies if It is subject of
land distribution under CARP, provided said homelot does not form part of the
retained area of the land owner
A tenant-beneficiary who is awarded a farmlot but has his homelot within
the retained area of the landowner
The landowner may opt to request the farmworker-beneficiary not to
remove the dwelling or other improvements for the former’s own use.
SECTION 31. Corporate Landowners.
Corporate landowners may voluntarily transfer ownership over their
agricultural landholdings to the Republic of the Philippines pursuant to Section 20
hereof or to qualified beneficiaries, under such terms and conditions, consistent
with this Act, as they may agree upon, subject to confirmation by the DAR.
Upon certification by the DAR, corporations owning agricultural lands may
give their qualified beneficiaries the right to purchase such proportion of the
capital stock of the corporation that the agricultural land, actually devoted to
agricultural activities, bears in relation to the company's total assets, under such
terms and conditions as may be agreed upon by them.
In no case shall the compensation received by the workers at the time the
shares of stocks are distributed be reduced. The same principle shall be applied to
associations, with respect to their equity or participation.
Corporations or associations which voluntarily divest a proportion of their
capital stock, equity or participation in favor of their workers or other qualified
beneficiaries under this section shall be deemed to have complied with the
provisions of the Act: Provided, That the following conditions are complied with:
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a) In order to safeguard the right of beneficiaries who own shares of stocks to

dividends and other financial benefits, the books of the corporation or
association shall be subject to periodic audit by certified public accountants
chosen by the beneficiaries;
b) Irrespective of the value of their equity in the corporation or association, the
beneficiaries shall be assured of at least one (1) representative in the board of
directors, or in a management or executive committee, if one exists, of the
corporation or association; and
c) Any shares acquired by such workers and beneficiaries shall have the same
rights and features as all other shares.
d) Any transfer of shares of stocks by the original beneficiaries shall be void ab
initio unless said transaction is in favor of a qualified and registered beneficiary
within the same corporation.
If within two (2) years from the approval of this Act, the land or stock transfer
envisioned above is not made or realized or the plan for such stock distribution
approved by the PARC within the same period, the agricultural land of the
corporate owners or corporation shall be subject to the compulsory coverage of
this Act.
31.1 Voluntary transfer of agricultural landholdings by corporate landowners to
the government
31.2 Voluntary divestment by corporations of a proportion of their capital stock
in favour of their workers; stock distribution plan
31.3 options no longer available to corporate landowners
(a) Voluntary land transfer (VLT)
(b) Stock distribution plan (SDP)
31.4 VLT and SDP no longer available options for corporate landowners per RA
9700
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31.5 Formula in computing the number of shares that can be bought by farmers
does not mean loss of control on their part over the land.
 Depends on the value of the agricultural land and the value of the total
assets of the corporation.
31.6 Duty of DAR and PARC to ensure majority representation of farmers in the
Corporation’s Board
31.8 PARC’s authority to approve SDP necessarily carries with it the power to
revoke the same.
 The authority to approve the stock distribution plan (SDP) of the corporate
landowner belongs to Presidential Agrarian Reform Council
 Power to revoke the SDP which it previously approved.
31.9 Power to revoke SDP pertains to PARC alone
 Only PARC can effect the revocation of the SDP.
SECTION 32. Production-Sharing.
Pending final land transfer, individuals or entities owning, or operating
under lease or management contract, agricultural lands are hereby mandated to
execute a production-sharing plan with their farm workers or farmworkers'
reorganization, if any, whereby three percent (3%) of the gross sales from the
production of such lands are distributed within sixty (60) days of the end of the
fiscal year as compensation to regular and other farmworkers in such lands over
and above the compensation they currently receive: Provided, That these
individuals or entities realize gross sales in excess of five million pesos per annum
unless the DAR, upon proper application, determines a lower ceiling
In the event that the individual or entity realizes a profit, an additional ten
percent (10%) of the net profit after tax shall be distributed to said regular and
other farmworkers within ninety (90) days of the end of the fiscal year.

To forestall any disruption in the normal operation of lands to be turned

over to the farmworker-beneficiaries mentioned above, a transitory period, the
length of which shall be determined by the DAR, shall be established.
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During this transitory period, at least one percent (1%) of the gross sales of
the entity shall be distributed to the managerial, supervisory and technical group
in place at the time of the effectivity of this Act, as compensation for such
transitory managerial and technical functions as it will perform, pursuant to an
agreement that the farmworker-beneficiaries and the managerial, supervisory and
technical group may conclude, subject to the approval of the DAR.

32.1 Mandatory execution of production sharing plan with farm workers or farm
wokers organization
32.2 Gross Sales defined
Means the total annual revenue from the sale of all agricultural products, in
their raw or or original state, derived from the land or farm owned, operated
under lease, management, production, grower or service contract, or the similar
arrangement by an agricultural enterprise.
32.3 Employers covered
(1) Any enterprise owning or operating agricultural lands under lease,
management contract, production venture or other similar arrangements,
agricultural land;
(2) Multinational corporations engaged in agricultural activities; and
(3) ) Commercial farms devoted to commercial livestock, poultry and swine
raising, aquaculture including saltbeds, fishponds, fruit farms, orchards,
vegetable and cut-flower farms, and cacao, coffee and rubber plantations
32.4 Employees Covered
All farmworkers of covered employers, wether classified as regular,
seasonal, technical or other farmworker, but excluding managerial and
supervisory employees of covered employers, are included in the mandated
Production and Profit Sharing. Provided, that any farmworker who renders
service, regardless of duration, within a covered period shall be entitled to this
benefit. Provided, further, that in the absence of any Presidential Agrarian Reform
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Council (PARC) determination of a specific award limit, the farmer-beneficiary

shall not own more than three (3) hectares of agricultural land.
32.5 Additional compensation to farmworkers in case of realized profit
 Within 6 months from the effectivity of RA 7881. Execute an incentive plan.
 Under the incentive plan, seven point five percent of their net profit before
tax from the operation of the fishpond or prawn farms.
 Shall be subject to to periodic audit or inspection by certified public
accountants chosen by the workers.
 Shall not apply to agricultural lands subsequently converted to fishpond or
prawn farms, provided the size of the land converted does not exceed the
retention limit of the landowner.
32-A.2 Prawn farms and fishponds generally exempt from CARP coverage;
exception
 Exempt from the Coverage of CARP
 Private agricultural lands owned by individuals
 Or Entities actually, directly and exclusively used for prawn and
fishponds as of March 12,1995