House, Senate OK bills extending foreign land lease limits
THE Senate and House of Representatives on Wednesday separately approved on second reading bills that seek to extend land lease limits for foreign investors to 99 from 75 years in a bid to entice foreign investments.
Approved by congressmen via voice vote, House Bill No. 10755 liberalizes Philippine land lease policies to help improve the country’s investment climate, which is expected to result in “economic growth and create jobs,” according to the measure.
Senate Bill No. 2898 also allows foreign investors to sublet properties unless barred by a contract.
Under the House bill, foreign private land leases related to tourism will be limited to investments of not less than $5 million, 70% of which must be infused within three years after a contract is signed.
“[It aims] to promote the Philippines as a top investment destination, encourage investors to engage in strategic investments and ensure that the country’s regulatory environment is conducive to business operations,” Iloilo Rep. Ferjenel G. Biron, who heads the House trade and industry committee, said in his sponsorship speech on Tuesday.
The measure is a legislative priority of President Ferdinand R. Marcos, Jr.’s government. It seeks to amend the 31-year-old Investors’ Lease Act, which allows foreign investors to lease private land for an initial period of 50 years, renewable once for a period no longer than 25 years.
The Philippines is hard-pressed on attracting foreign investments despite being one of Asia’s fastest-growing economies as weak infrastructure, high electricity costs and tight regulations deter foreign investors.
A total of $8.9 billion in foreign direct investments flowed into the Philippines in 2023, compared with Singapore’s $159.6 billion, Indonesia’s $21.6 billion and Vietnam’s $18.5 billion, based on an Association of Southeast Asian Nations report.
The proposal will permit foreign investors to lease land for agriculture, agroforestry and ecological conservation purposes, according to an amendment by Baguio Rep. Mark O. Go accepted by the House floor.
The measure provides that lease agreements for lots outside economic zones or freeport areas will be subject to the Board of Investments’ approval. It also aims to allow foreign investors to sublet their leased land.
Foreign investors who fail to initiate their planned investment projects on the leased lands within three years risk having their land contracts terminated by the Trade secretary or the heads of economic zones or freeport areas, according to the bill.
The proposal also imposes a jail term of up to six years and a fine of as much as P6 million on lessees and investors who use the leased land contrary to Philippine laws. — Kenneth Christiane L. Basilio and John Victor D. Ordonez
