LAND ACQUISITION IN A SPECIAL

ECONOMIC ZONE
The very crucial phase in establishing ECOZONES is the assembly of land parcels with
secure title and development rights by the government to economic zones development
groups, development of better land use/ownership laws and regulations and adaptation
of enforceable zoning and land use plans.
And perceptibly, one of the major procedures taken upon registration of an ECOZONE
Enterprise is the acquisition of land where these zones may be establish. All sites of the
ECOZONES and other areas where ECOZONES may be established shall conform to
the following general criteria to ensure their viability and geographical dispersal.
Foreign corporations may acquire and own land in the Philippines provided that it is a
private land, which means any land of private ownership; and the foreign equity in the
corporation must not exceed forty percent (40%). If a foreign ownership in the
corporation exceeds 40%, the effect would be that the foreign corporation would lose its
capacity to hold the private land. They may, however, be granted temporary rights such
as a lease contract which is not prohibited by the Constitution.
Registered Enterprises under PEZA enjoy various fiscal and non-fiscal incentives with
the exception on real property tax on land owned by developers.
LEASE OF LANDS AND BUILDINGS IN THE ECOZONES
Qualifications
Lands and buildings within an ECOZONE can be leased only to ECOZONE
enterprises / entities authorized by or registered with the PEZA and owned or controlled
either by Philippine nationals or by aliens under such terms and conditions as the Board
may formulate.
With respect, however, to lease of lands to ECOZONE enterprises wholly owned or
controlled by aliens, the following limitations and conditions shall apply:
a. The lease period shall not exceed fifty (50) years extendible once for a period not
more than twenty five (25) years.
b. The area leased shall be used exclusively for the purpose of investments as
approved by the PEZA and other government agencies, if applicable. In case the leased
premises or any part thereof is used for any other purpose different from that as
approved or not related thereto or connected therewith, without the prior written

approval by the PEZA, the lease may be considered terminated and / or cancelled by
the PEZA without prejudice to the penalties provided for under Section 7 of R.A. No.
7652, otherwise known as the Investors Lease Act, and compensation for damages
suffered by the lessor.
c. The lease premises shall comprise only such area as may reasonably be required for
the project contemplated in the investment. Additional areas for future or intended
expansion may also be leased upon satisfactory showing of the viability of the proposed
expansion and payment of reservation fee for the land within a period as may be
determined by the Board.
d. In case the ECOZONE enterprise desires to extend the lease after the initial period of
fifty (50) years, it shall present proof that it has made social and economic contributions
to the country, otherwise, the application for renewal/ extension shall be disapproved.
e. In case of tourism projects, lease of private lands by a registered ECOZONE Tourism
Enterprise, wholly foreign-owned or more than 40% of whose outstanding capital stock
is owned by aliens, shall be limited to projects with a projected investment of not less
than Five Million ($5 Million) US Dollars seventy percent (70%) of which should be
infused in said project not later than three (3) years within the execution of the lease
agreement. In case of violation of this condition, the lease agreement shall be deemed
cancelled and terminated upon the expiration of the three (3) year period unless an
extension is granted by the PEZA upon clearly meritorious grounds.

However, if the entire period of lease of private land is less than fifty (50) years or not
exceeding fifty (50) years with no right to extend the lease period, the foregoing
requirement as to the minimum amount of projected investment in tourism projects by
foreign owned or controlled ECOZONE Tourism Enterprises shall be prescribed by the
Board.

With respect to tourism projects wholly owned or controlled by Philippine nationals, the
above prescribed minimum investment in tourism projects within an ECOZONE shall not
apply.

Cancellation of Lease
Any long term lease contract referred to in Section 1 hereof may be cancelled at the
instance of the PEZA, if the project is not initiated within the period as stated in the
contract or three (3) years from the date of the lease contract whichever comes earlier,
unless an extension is granted by the PEZA upon valid meritorious grounds.

Transfer of Leasehold Rights

All leasehold rights acquired under long term lease contracts in accordance with this
Rule and the Act may be sold, transferred, assigned or conveyed: Provided, That if the
transferee or assignee is a Filipino citizen or an enterprise wholly owned by Filipino
citizens, the limitations contained in Section 1 hereof with respect to the maximum
period of lease shall not apply: Provided, finally, That the transferee or assignee shall be
a registered ECOZONE enterprise or possesses all the qualifications and none of the
disqualifications to be eligible for registration as an ECOZONE enterprise to be
determined by the PEZA.

SALE OF LAND

Land Acquisition
An ECOZONE enterprise duly registered with the PEZA may acquire lands within the
ECOZONE subject to compliance with the nationality requirements under the Philippine
Constitution and existing laws and to the terms and conditions as may be prescribed by
the Board. If the ECOZONE enterprise is a corporation desiring to acquire lands within
the ECOZONE, it must be duly organized under the laws of the Philippines and at least
sixty percent (60%) of its outstanding capital stock and entitled to vote is owned and
held by citizens of the Philippines.

URBAN PLANNING
ON March 16, 2021, it will be 500 years after Magellan discovered the Philippines. Also
last March 16, 2016, Mr. FELINO A. PALAFOX, JR. as the guest speaker at the
American Chamber of Commerce in the Philippines talked about Philippines at 500,
Philippines 2021 and beyond: Vision Plan and Manila Megalopolis 2021 towards 2050.
The vision plan 2021 puts forward a strategy to create urban development corridors by
clustering major cities as urban growth centers to act as counter magnets to Metro
Manila, spurring new investments nationwide and redevelopment opportunities in the
other cities, creating jobs and economic opportunities for the urban poor in the
provinces.
Aside from decongesting Metro Manila, economic zones are vital to the growth of our
nation for they encourage international trade and contribute to the overall Gross
Domestic Product.
In their involvement in the master plan and design of economic zones and business
parks in the Philippines, Palafox Associates and Palafox Architecture have come up with
four essential considerations.

First, know the current products and employment of the local population and use the
information to their benefit. For example, if the major income source is agricultural, then
post-harvest facilities would be good to incorporate in the plan.

Second, an ECOZONE must have efficient transportation links. It would not work if
connections to air, land, and sea are lacking.

Another point to consider is designing the streets in the human scale. In relation to
transport, it is necessary to prioritize walking and biking within ECOZONES. As such
developments usually occupy big plots of land, this could be a bit trickier to execute so it
would be best to work with master planning experts.

Last, but definitely not the least, ECOZONES should have a mix of uses. It cannot all be
industries and offices. There should also be places to live, dine, play, shop, and
worship, among others. Mixed-use developments also provide for different incomes,
generations, and housing types.

(For Ppt)

1st slide:

LAND ACQUISITION IN A SPECIAL

ECONOMIC ZONE
2nd slide:
Foreign corporations may acquire and own land in the Philippines provided that it is a
private land, which means any land of private ownership; and the foreign equity in the
corporation must not exceed forty percent (40%).
3rd slide:
LEASE OF LANDS
4th slide:
Qualifications:
ENTERPRISES AUTHORIZED AND REGISTERED WITH THE PEZA

Limitations to ECOZONE enterprises wholly owned or controlled by aliens:

The lease period shall not exceed fifty (50) years extendible once for a period not
more than twenty five (25) years.
The area leased shall be used exclusively for the purpose of investments
The lease premises shall comprise only such area as may reasonably be required
for the project contemplated in the investment.
In case the ECOZONE enterprise desires to extend the lease after the initial period
of fifty (50) years, it shall present proof that it has made social and economic

contributions to the country, otherwise, the application for renewal/ extension shall
be disapproved.
For tourism projects, the lease shall be limited to projects with an investment of not
less than US$5M, 70% of which shall be infused in said project within 3 years from
signing of the lease contract.

5th slide:
Cancellation of Lease
Any long term lease contract referred to in Section 1 hereof may be cancelled at the
instance of the PEZA

Transfer of Leasehold Rights

All leasehold rights acquired under long term lease contracts in accordance with this
Rule and the Act may be sold, transferred, assigned or conveyed

6th slide:
SALE OF LAND WITHIN AN ECOZONE

7th slide:

Land Acquisition
Foreign corporations may acquire and own land in the Philippines provided that it is a
private land, which means any land of private ownership; and the foreign equity in the
corporation must not exceed forty percent (40%).

8TH slide:

TH

slide:

URBAN PLANNING

Philippines at 500, Philippines 2021 and beyond: Vision Plan and Manila Megalopolis
2021 towards 2050.
American Chamber of Commerce in the Philippines
March 16, 2016
Mr. FELINO A. PALAFOX, JR. - Guest Speaker

10th slide:
Four essential considerations in the design of economic zones and business parks in
the Philippines by the Palafox Associates and Palafox Architecture:

o Know the current products and employment of the local population and use the
information to their benefit.
o An ECOZONE must have efficient transportation links. It would not work if
connections to air, land, and sea are lacking.
o Designing the streets in the human scale.
o ECOZONES should have a mix of uses.

QUIZ
1. It is also known as Investors Lease Act which states that Foreign investors can
enter lease agreements with Filipino landowners.
a. R.A. No. 7625

b. R.A. No. 7652

c. R.A. No. 7612

d. R.A. No. 7621

Answer: B.

2. For tourism projects, the lease shall be limited to projects with an investment of
not less than?
a. US$3M
Answer: A.

b. US$5M

c. P3M

D. P5M