September 17, 2003

DAR OPINION NO. 18-03

Joseph Jason M. Natividad
7th Floor, Montepino Building
Adelantado corner Gamboa Streets,
Legaspi Village, Makati City

Dear Mr. Natividad:

This refers to your letter-request for opinion on whether or not there is a need for a DAR Conversion Clearance before an agricultural land can be developed into a farmlot subdivision.   acCTSE

In your letter, you stated, among others the following: that your client has a proposed farmlot subdivision project over an 80-hectare agricultural land which will be subdivided into 1,000 square meter lots for sale to weekend farmers; that the agricultural nature of the lands will not be lost since the subdivided farmlots will still be primarily devoted to agricultural activities although farm to market roads and other infrastructures incidental thereto will be constructed to serve the needs of the lot buyers; and that subdividing the 80-hectare agricultural land will not necessarily convert the land to residential on the assumption that it will be primarily devoted to agricultural activity and only a small portion will be allocated for dwelling or housing purposes.

In DAR Opinion No. 10, Series of 2001, we earlier already had the occasion to address a similar issue on whether or not there is still a need to secure a DAR Conversion Clearance as regards the development of farmlot subdivision, quote:

"As defined in DAR Administrative Order No. 1, Series of 1999 [REVISED RULES AND REGULATIONS ON THE CONVERSION OF AGRICULTURAL LANDS TO NON-AGRICULTURAL USES], "land use conversion" refers to the act or process of changing the current use of a piece of agricultural land into some other use as approved by DAR on the other hand, a "farmlot subdivision" had been defined under the Human Settlements Regulatory Commission (now Housing and Land Use Regulatory Board) Rules and Regulations Implementing Farmlot Subdivision Plan as "a planned community intended primarily for intensive agricultural activities, and secondarily for housing."

If the proposed farmlot subdivision of your client falls squarely within the cited definition, the fact that there is a housing requirement is an indication to change the use of an agricultural land to residential and this is covered by the definition of "land use conversion." The slighted change in the agricultural land use to some other non-agricultural use which in this case is residential), no matter how minimal the area to be covered by such change and even if housing is a secondary purpose, will be interpreted as land use conversion as defined in the cited DAR A.O. As such, there is a need to apply for a conversion clearance from the DAR. . . . .

Additionally, Section 2 (C1) of the above mentioned HLURB Rules and Regulations provides that a clearance from the Department of Agrarian Reform is required from applicants of farmlot subdivision." (emphasis supplied)   TIaCHA

It bears stressing here, moreover, Sections 4 (d) and 6 (1st paragraph) of R.A. No. 6657 (Comprehensive Agrarian Reform Law), which provide:

"SECTION 4.          Scope — The Comprehensive Agrarian Reform Law of 1988 shall cover, regardless of tenurial arrangement and commodity produced, all public and private agricultural lands as provided in Proclamation No. 131 and Executive Order No. 229, including other lands of the public domain suitable for agriculture. More specifically, the following lands are covered by the Comprehensive Agrarian Reform Program:

xxx                      xxx                      xxx

d)      All private lands devoted to or suitable for agriculture regardless of the agricultural products raised or that can be raised thereon." (emphasis supplied)

"SECTION 6.          Retention Limits. — . . . In no case shall retention by the landowner exceed five (5) hectares. . . ."

From the aforequoted provisions of R.A. No. 6657, it is clear that all private lands devoted to or suitable for agriculture in excess of the 5-hectare retention limit shall be acquired under the Comprehensive Agrarian Reform Program (CARP) for distribution to qualified agrarian reform beneficiaries (as defined and contemplated under existing agrarian laws, rules and regulations) and not to "weekend farmers."

It is the spirit and intent of the law to cover all agricultural lands devoted to or suitable for agriculture. Moreover, since R.A. No. 6657 is a social welfare legislation, the rules on exemptions, exclusions and/or conversions must be interpreted restrictively and any doubt as to the applicability of the law should be resolved in favor of inclusion. Thus, the subject agricultural landholding which is beyond the 5-hectare retention area, if not converted, may be acquired under the CARP for distribution to agrarian reform beneficiaries.

If we are to opine, as requested, that portions of the proposed farmlot subdivision devoted to agricultural use will no longer require a conversion clearance, we would in effect be saying that they are not coverable under CARP contrary to the spirit and intent of the law (R.A. No. 6657) to cover all agricultural lands devoted to or suitable for agriculture.   SaITHC

Accordingly, given all the foregoing, an application for conversion and a DAR conversion order duly issued on the merits shall still be required.

We hope to have clarified the matter.

Very truly yours,

(SGD.) RICARDO S. ARLANZA
Undersecretary for Policy Planning and
Legal Affairs Office