CONVERSION Section 65, RA 6657 Section 65. Conversion of Lands.

After the lapse of five (5) years from its award, when the land ceases to be economically feasible and sound for agricultural purposes, or the locality has become urbanized and the land will have a greater economic value for residential, commercial or industrial purposes, the DAR, upon application of the beneficiary or the landowner, with due notice to the affected parties, and subject to existing laws, may authorize the reclassification or conversion of the land and its disposition: provided, that the beneficiary shall have fully paid his obligation. Section 20, RA 7160 Section 20. Reclassification of Lands. (a) A city or municipality may, through an ordinance passed by the sanggunian after conducting public hearings for the purpose, authorize the reclassification of agricultural lands and provide for the manner of their utilization or disposition in the following cases: (1) when the land ceases to be economically feasible and sound for agricultural purposes as determined by the Department of Agriculture or (2) where the land shall have substantially greater economic value for residential, commercial, or industrial purposes, as determined by the sanggunian concerned: Provided, That such reclassification shall be limited to the following percentage of the total agricultural land area at the time of the passage of the ordinance: (1) For highly urbanized and independent component cities, fifteen percent (15%); (2) For component cities and first to the third class municipalities, ten percent (10%); and (3) For fourth to sixth class municipalities, five percent (5%): Provided, further, That agricultural lands distributed to agrarian reform beneficiaries pursuant to Republic Act Numbered Sixty-six hundred fiftyseven (R.A. No. 6657). otherwise known as "The Comprehensive Agrarian Reform Law", shall not be affected by the said reclassification and the conversion of such lands into other purposes shall be governed by Section 65 of said Act. (b) The President may, when public interest so requires and upon recommendation of the National Economic and Development Authority, authorize a city or municipality to reclassify lands in excess of the limits set in the next preceding paragraph. (c) The local government units shall, in conformity with existing laws, continue to prepare their respective comprehensive land use plans enacted through zoning ordinances which shall be the primary and dominant bases for the future use of land resources: Provided. That the requirements for food production, human settlements, and industrial expansion shall be taken into consideration in the preparation of such plans. (d) Where approval by a national agency is required for reclassification, such approval shall not be unreasonably withheld. Failure to act on a proper and complete application for reclassification within three (3) months from receipt of the same shall be deemed as approval thereof. (e) Nothing in this Section shall be construed as repealing, amending, or modifying in any manner the provisions of R.A. No. 6657. MEMORANDUM CIRCULAR NO. 54 PRESCRIBING THE GUIDELINES GOVERNING SECTION 20 OF RA 7160 OTHERWISE KNOWN AS THE LOCAL GOVERNMENT CODE OF 1991 AUTHORIZING CITIES AND MUNICIPALITIES TO RECLASSIFY AGRICULTURAL LANDS INTO NON-AGRICULTURAL USES WHEREAS, RA 7160, otherwise known as the Local Government Code of 1991 (LGC), provides that cities and municipalities may reclassify agricultural lands into non-agricultural uses within their respective jurisdictions, subject to the limitations and other conditions prescribed under Section 20 of the LGC; WHEREAS, the implementing Rules and Regulations (IRR) of the LGC provides that cities and municipalities shall continue to prepare their respective comprehensive land use plans, enacted through zoning ordinances, subject to applicable laws and rules and regulations; WHEREAS, the IRR also prescribes that such plans shall serve as the primary and dominant bases for future use of land resources and reclassification of agricultural lands; WHEREAS, the IRR further provides that the requirements for food production, human settlements, ecological balance, and industrial expansion shall be considered in the preparation of comprehensive land use plans; WHEREAS, EO 129-A, s. of 1987, mandates the Department of Agrarian Reform (DAR) to approve or disapprove the conversion, restructuring or readjustment of agricultural lands into non-agricultural uses;

WHEREAS, the said EO has also vested in DAR exclusive authority to approve or disapprove conversion of agricultural lands for residential, commercial, industrial, and other land uses; WHEREAS, Section 65 of RA 6657, otherwise known as the Comprehensive Agrarian Reform Law of 1988 (CARL), likewise empowers DAR to authorize, under certain conditions, the reclassification or conversion of lands awarded to agrarian reform beneficiaries; WHEREAS, pursuant to the pertinent provisions of EO 129-A (1987), EO 229 (1987), and RA 6657, DAR issued various rules and regulations governing the conversion or reclassification of agricultural lands into non-agricultural uses; WHEREAS, there is a need to harmonize the provisions of Section 20 of the LGC with those of EO 129-A (1987), EO 229 (1987), RA 6657, and other national policy issuances and other pertinent laws to ensure a more rational and holistic approach to land use, taking into account the objectives of the CARL and the decentralized framework of local governance; NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Philippines, by virtue of the powers vested in me by law, upon the recommendation of the Oversight Committee created under Sec. 533 of the LGC, do hereby order and direct: SECTION 1. Scope and limitations. (a) Cities and municipalities with comprehensive land use plans reviewed and approved in accordance with EO 72 (1993), may authorize the reclassification of agricultural lands into non-agricultural uses and provide for the manner of their utilization or disposition, subject to the limitations and other conditions prescribed in this Order. (b) Agricultural lands may be reclassified in the following cases: (1) when the land ceases to be economically feasible and sound for agricultural purposes as determined by the Department of Agriculture (DA), in accordance with the standards and guidelines prescribed for the purpose; or (2) where the land shall have substantially greater economic value for residential, commercial, or industrial purposes as determined by the sanggunian concerned, the city/municipality concerned should notify the DA, HLRB, DTI, DOT and other concerned agencies on the proposed reclassification of agricultural lands furnishing them copies of the report of the local development council including the draft ordinance on the matter for their comments, proposals and recommendations within seven (7) days upon receipt. (c) However, such reclassification shall be limited to a maximum of the percentage of the total agricultural land of a city or municipality at the time of the passage of the ordinance as follows: (1) For highly urbanized and independent component cities, fifteen percent (15%); For component cities and first to third class municipalities, ten percent (10%); and For fourth to sixth class municipalities, five percent (5%). (d) In addition, the following types of agricultural lands shall not be covered by the said reclassification: (1) Agricultural lands distributed to agrarian reform beneficiaries subject to Section 65 of RA 6657; (2) Agricultural lands already issued a notice of coverage or voluntarily offered for coverage under CARP. (3) Agricultural lands identified under AO 20, s. of 1992, as non-negotiable for conversion as follows: (i) All irrigated lands where water is available to support rice and other crop production; All irrigated lands where water is not available for rice and other crop production but within areas programmed for irrigation facility rehabilitation by DA and National Irrigation Administration (NIA); and All irrigable lands already covered by irrigation projects with firm funding commitments at the time of the application for land conversion or reclassification. (e) The President may, when public interest so requires and upon recommendation of the National Economic Development Authority (NEDA), authorize a city or municipality to reclassify lands in excess of the limits set in paragraph (d) hereof. For this purpose, NEDA is hereby directed to issue the implementing guidelines governing the authority of cities and municipalities to reclassify lands in excess of the limits prescribed herein. SEC. 2. Requirements and procedures for reclassification. (a) The city or municipal development council (CDC/MDC) shall recommend to the sangguniang panlungsod or sangguniang bayan, as the case may be, the reclassification of agricultural lands within its jurisdiction based on the requirements of local development. (b) Prior to the enactment of an ordinance reclassifying agricultural lands as provided under Sec. 1 hereof, the sanggunian concerned must first secure the following certificates from the concerned national government agencies (NGAs): (1) A certification from DA indicating -

(i) the total area of existing agricultural lands in the LGU concerned; (ii) that such lands are not classified as non-negotiable for conversion or reclassification under AO 20 (1992); and (iii) that the land ceases to be economically feasible and sound for agricultural purposes in the case of Sec. 1 (b-1). (2) A certification from DAR indicating that such lands are not distributed or not covered by a notice of coverage or not voluntarily offered for coverage under CARP. (c) The HLRB shall serve as the coordinating agency for the issuance of the certificates as required under the preceding paragraph. All applications for reclassification shall, therefore, be submitted by the concerned LGUs to the HLRB, upon receipt of such application, the HLRB conduct initial review to determine if: (1) the city or municipality concerned has an existing comprehensive land use plan reviewed and approved in accordance with EO 72 (1993); and (2) the proposed reclassification complies with the limitations prescribed in SECTION 1 (d) hereof. Upon determination that the above conditions have been satisfied, the HLRB shall then consult with the concerned agencies on the required certifications. The HLRB shall inform the concerned agencies, city or municipality of the result of their review and consultation. If the land being reclassified is in excess of the limit, the application shall be submitted to NEDA. Failure of the HLRB and the NGAs to act on a proper and complete application within three months from receipt of the same shall be deemed as approved thereof. (d) Reclassification of agricultural lands may be authorized through an ordinance enacted by the sangguniang panlungsod or sangguniang bayan, as the case may be, after conducting public hearings for the purpose. Such ordinance shall be enacted and approved in accordance with Articles 107 and 108 of the IRR of the LGC; (e) Provisions of Sec. 1 (b-2) hereof to the contrary notwithstanding, the sanggunian concerned shall seek the advice of DA prior to the enactment of an ordinance reclassifying agricultural lands. If the DA has failed to act on such request within thirty (30) days from receipt thereof, the same shall be deemed to have been complied with. Should the land subject to reclassification is found to be still economically feasible for agriculture, the DA shall recommend to the LGU concerned alternative areas for development purposes. (f) Upon issuance of the certifications enumerated in Section 2 (b) hereof, the sanggunian concerned may now enact an ordinance authorizing the reclassification of agricultural lands and providing for the manner their utilization or disposition. Such ordinance shall likewise update the comprehensive land use plans of the LGU concerned. SEC. 3. Review of ordinances reclassifying agricultural lands. All ordinances authorizing the reclassification of agricultural lands shall be subject to the review and approval by the province in the case of component city or municipality, or by HLRB in the case of a highly urbanized or independent component city in accordance with EO 72 (1993). SEC. 4. Use of the comprehensive land use plans and ordinances as primary reference documents in land use conversions. Pursuant to RA 6657 and EO 129-A, actions on applications for land use conversions on individual landholdings shall remain as the responsibility of DAR, which shall utilize as its primary reference documents the comprehensive land use plans and accompanying ordinance passed upon and approved by the LGUs concerned, together with the National Land Use Policy. SEC. 5. Monitoring and evaluation of land reclassification by LGUs concerned. Within six (6) months from the issuance of this Order, the HLRB shall design, in coordination with DA, DAR, Department of the Interior and Local Government (DILG), NEDA, League of Provinces, League of Cities and League of Municipalities, and install a monitoring and evaluation system for the reclassification of agricultural lands authorized by cities and municipalities. The HLRB shall submit semestral reports to the Office of the President. A copy thereof shall be furnished the DA, DAR, DILG, NEDA, League of Provinces, League of Cities, and League of Municipalities. SEC. 6. Transitory provision. Provisions of Secs. 1 (a) and 2 (b) to the contrary notwithstanding, cities and municipalities with land use plans approved not earlier than 01 January 1989, may authorize the reclassification of agricultural lands in accordance with the limitations and conditions prescribed in this Order. However, when the LGU has not reclassified up to the said limitations, further reclassification may be exercised only within five years from the approval of the plan. Thereafter, all reclassifications shall require approval from the President pursuant to Sec. 1 (e) of this Circular. SEC. 7. Effectivity. -.This Circular shall take effect immediately.

February 28, 2002 DAR ADMINISTRATIVE ORDER NO. 01-02 SUBJECT : 2002 Comprehensive Rules On Land Use Conversion

Pursuant to Section 65 and 49 of Republic Act (RA) No. 6657 (Comprehensive Agrarian Reform Law of 1988), Section 4(j) and 5(l) of Executive Order (EO) No. 129-A (Reorganization Act of the Department of Agrarian Reform), the pertinent provisions of RA 8435 (Agriculture and Fisheries Modernization Act), EO-45-2001 [25 October 2001], and in order to provide effective means of evaluating applications for land use conversion, these Rules are hereby promulgated: ARTICLE I Preliminary Provisions SECTION 1. Statement of Policies. The conversion of agricultural lands to non-agricultural uses shall be governed by the following policies: 1.1. The State shall preserve prime agricultural lands to ensure food security.

1.2. The State shall ensure that all sectors of the economy and all regions of the country are given optimum opportunity to develop, through the rational and sustainable use of resources peculiar to each area, in order to maximize agricultural productivity, to promote efficiency and equity, and to accelerate the modernization of the agriculture and fisheries sectors of the country. 1.3. Conversion of agricultural lands to non-agricultural uses shall be strictly regulated and may be allowed only when the conditions prescribed under RA 6657 and/or RA 8435 are present and complied with. SECTION 2. Definition of Terms. All references in these Rules in the masculine gender form (he/him/his) shall interchangeably mean the feminine form (she/her/hers) or may refer to a group (it/it's/their). As used in this AO, the terms enumerated are defined as follows: 2.1. Agricultural land refers to land devoted to or suitable for the cultivation of the soil; planting of crops, growing of trees, raising of livestock, poultry, fish or aquaculture production, including the harvesting of such farm products and other farm activities and practices performed in conjunction with such farming operations by persons whether natural or juridical, and not classified by law as mineral land, forest or timber, or national park, or classified for residential, commercial, industrial or other non-agricultural uses before 15 June 1988. 2.2. Area Highly Restricted from Conversion refers to agro-industrial cropland, or land presently planted to industrial crops that support the economic viability of existing agricultural infrastructure and agro-based enterprises; highland or area located at an elevation of 500 meters or higher and have the potential for growing semi-temperate and/or high value crops; land covered by a notice of land valuation and acquisition; irrigable land not covered by irrigation projects with firm funding commitment; and Environmentally Critical Area and Environmentally Critical Projects as determined by the Department of Environment and Natural Resources (DENR). 2.3. Area Non-Negotiable for Conversion refers to agricultural land not eligible for conversion as enumerated in Section 4 hereof. 2.4. Comprehensive Land Use Plan refers to a document accompanied by maps and similar illustrations, which represent the community-desired pattern of population distribution and proposal for the future allocation of land for various land use activities. It identifies the allocation, character and extent of the area's land resources to be used for different purposes and includes the process and the criteria employed in the determination of the land's use. 2.5. Conversion Moratorium refers to the policy enunciated in RA 8435 which prohibits the conversion of irrigated lands, irrigable lands already covered by irrigation projects with firm funding commitments, and lands with existing or having the potential for growing high value crops so delineated and included within the Strategic Agriculture and Fisheries Development Zones for the period starting 10 February 1998 to 09 February 2003. 2.6. Environmentally Critical Areas (ECA) refer to areas that are ecologically, socially, or geologically sensitive as declared by law such as: 2.6.1. Areas declared by law as national parks, watershed reserves, wildlife preserves and sanctuaries; 2.6.2. Areas identified as potential tourist spots; 2.6.3. Areas that are habitats of endangered or threatened species of indigenous Philippine plants and animals; 2.6.4. Areas of unique historic, archeological or scientific interest;

2.6.5. Areas traditionally occupied by indigenous people or cultural communities; 2.6.6. Areas frequently hit by natural calamities (geologic hazards, floods, typhoons and volcanic activities); 2.6.7. Areas with critical slopes of 18% and above; 2.6.8. Areas classified as prime agricultural lands; 2.6.9. Recharged areas of aquifer; 2.6.10. 2.6.11. 2.6.12. 2.7. Water bodies used for domestic supply or to support fisheries and wildlife; Mangrove areas with critical ecological functions or on which people depend for livelihood; or Coral reefs.

Environmentally Critical Project (ECP) refers to a: 2.7.1. Heavy industry project involving ferrous metals, iron or steel mills; petroleum or petro-chemicals, oil, gas, or smelting plants; 2.7.2. Resource extractive project such as major mining and quarrying project, forestry logging project, major wood processing, introduction of fauna or exotic animals in public or private forests, forest occupancy, extraction of mangrove products, grazing, fishery dikes, or fishpond development; 2.7.3. Major infrastructure project such as dam, power plant (utilizing fossil-fuel, hydroelectric, geothermal, or nuclear power), reclamation, bridge, or a major road; or 2.7.4. Golf course project.

2.8. Illegal Conversion is the conversion by any landowner of his agricultural land into any non-agricultural use with intent to avoid the application of RA 6657 to his landholding and to dispossess his tenant farmers of the land tilled by them; or the change of nature of lands outside urban centers and city limits either in whole or in part after the effectivity of RA 6657, as provided in Section 73 (c) and (e), respectively, of the said Act. 2.9. Irrigable Land refers to land displaying marked characteristics justifying the operation of an irrigation system. 2.10. Irrigated Land refers to land serviced by natural irrigation or irrigation facilities. This includes lands where water is not readily available because existing irrigation facilities need rehabilitation or upgrading or where irrigation water is not available year-round. 2.11. Land Use refers to the manner of utilization of land, including its allocation, development and management. 2.12. Land Use Conversion refers to the act or process of changing the current physical use of a piece of agricultural land into some other use or for another agricultural use other than the cultivation of the soil, planting of crops, growing of trees, including harvesting of produce therefrom, as approved by DAR. 2.13. National Integrated Protected Areas System (NIPAS) refers to the classification and administration of all designated protected areas to maintain essential ecological processes and life support systems, to preserve genetic diversity, to ensure sustainable use of resources found therein, and to maintain their natural conditions to the greatest extent possible. NIPAS includes areas designated as initial components of the system under Section 5 (a) of RA 7586 which include all areas or islands in the Philippines proclaimed, designated or set aside, pursuant to a law, presidential decree, presidential proclamation or executive order as national park, game refuge, bird and wildlife sanctuary, wilderness area, strict nature reserve, watershed, mangrove reserve, fish sanctuary, natural and historical landmark, protected and managed landscape/seascape as well as identified virgin forest before the effectivity of RA 7586; those proclaimed as part of the system in accordance with the procedure established under the said Act such as strict nature reserve, natural park, natural monument, wildlife sanctuary, protected landscapes and seascapes; resource reserve; natural biotic areas; and other categories established by law, conventions or international agreements wherein the Philippine Government is a signatory. 2.14. Network of Protected Areas for Agricultural and Agro-Industrial Development (NPAAAD) refers to agricultural areas identified by the Department of Agriculture (DA) through the Bureau of Soils and Water Management in coordination with the National Mapping and Resource Information Authority, in order to ensure the efficient utilization of land to agriculture and agro-industrial development and promote sustainable growth. The NPAAAD covers all irrigated areas, all irrigable lands already covered by irrigation projects with firm funding commitments; all alluvial plains highly suitable for agriculture, whether irrigated or not; agro-industrial croplands or lands presently planted to industrial crops that support the viability of existing agricultural infrastructure and agrobased enterprises; highland or areas located at an elevation of five hundred (500) meters or above, which have the potential for growing semi-temperate and high-value crops; all agricultural lands that are ecologically fragile, the

conversion of which will result in serious environmental degradation, and mangrove areas and fish sanctuaries; and all fishery areas as defined pursuant to the Fisheries Code of 1998. 2.15. Premature Conversion of Agricultural Land refers to the undertaking of any development activity, the result of which may modify or alter the physical characteristics of the agricultural land as would render it suitable for nonagricultural purposes without an approved Conversion Order from the DAR. 2.16. Prime Agricultural Land refers to land that can be used for various or specific agricultural activities and can provide optimum and sustainable yield with minimum inputs and development costs as determined by the DA. 2.17. Private Agricultural Land refers to agricultural land as defined herein and owned by natural or juridical persons or by the government in its proprietary capacity. 2.18. Project Feasibility Study involves the investigation of the market, technical, financial, economic, and operational viability of the project. Specifically, it looks into the alternative technical schemes to attain the project's objectives including possible size, location, production process, and physical and financial resource requirements. The study also determines whether the project would generate sufficient benefits to offset estimated investment and operating costs. Similarly, it ascertains which of the alternatives would yield the largest positive return to the economy that would justify its use of resources. Finally, it seeks the most suitable legal, administrative and organizational arrangements to ensure that implementation would proceed as planned and that completed facilities would be properly maintained and operated. 2.19. Reclassification of Agricultural Land refers to the act of specifying how agricultural lands shall be utilized for non-agricultural uses such as, residential, industrial, commercial, as embodied in the land use plan, subject to the requirements and procedure for land use conversion, undertaken by a Local Government Unit (LGU) in accordance with Section 20 of RA 7160 and Joint Housing and Land Use Regulatory Board (HLURB), DAR, DA, and Department of Interior and Local Government (DILG) MC-54-1995. It also includes the reversion of non-agricultural lands to agricultural use. 2.20. Socialized Housing refers to housing programs and projects covering houses and lots or homelots undertaken by the government or the private sector for the underprivileged and homeless citizens where the maximum cost per unit does not exceed the maximum amount as prescribed by the Housing and Urban Development Coordinating Council (HUDCC) which shall include sites and services development, long-term financing, liberalized terms on interest payments, and such other benefits in accordance with RA 7279. 2.21. Socio-Economic Benefit-Cost Study involves the assessment of the project's net contribution to the national economic and social welfare, done through a comparison of the economic and social benefits expected to be generated from the project with the social and economic costs of its implementation and operation. 2.22. Special Economic Zone or Eco Zone refers to selected areas which are highly developed or which have the potential to be developed into agro-industrial, tourist, recreational, commercial, banking, investment and financial centers whose metes and bounds are delimited by Presidential Proclamation. 2.23. Strategic Agriculture and Fisheries Development Zone (SAFDZ) refer to the areas within the NPAAAD identified for production, agro-processing and marketing activities to help develop and modernize, with the support of the government, the agriculture and fisheries sectors in an environmentally and socio-culturally sound manner. 2.24. Unauthorized Conversion is the act of changing the current use of the land from agricultural (e.g. riceland) to another agricultural use, the effect of which is to exclude the land from CARP coverage (e.g. livestock) without a Conversion Order from the DAR, or changing the use of the land other than that allowed under the Conversion Order issued by the DAR. 2.25. Watershed refers to a catchment area or drainage basin from which the waters of a stream or stream system are drawn. 2.26. Zoning is the delineation/division of a city/municipality into functional zones where only specific land uses are allowed. It directs and regulates the use of all lands in the community in accordance with an approved or adopted land use plan for the city/municipality. It prescribes setback provisions, minimum lot sizes, building heights and bulk. 2.27. Zoning Ordinance refers to a local legislation approving the comprehensive land use plan and providing for the regulations and other conditions, on the uses of land including the limitation on the infrastructures that may be placed thereon within the territorial jurisdiction of a city or municipality. ARTICLE II Coverage SECTION 3. Applicability of Rules These guidelines shall apply to all applications for conversion, from agricultural to non-agricultural uses or to another agricultural use, such as:

3.1.

Conversions into residential, commercial, industrial, institutional and other non-agricultural purposes;

3.2. Development into other types of agricultural activities such as livestock, poultry, and fishpond, the effect of which is to exempt the land from CARP coverage; 3.3. Conversions into non-agricultural use other than that previously authorized; or

3.4 Conversion of agricultural lands or areas that have been reclassified by the LGU or by way of a Presidential Proclamation, to residential, commercial, industrial, or other non-agricultural uses on or after the effectivity of R.A. 6657 on 15 June 1988, pursuant to Section 20 of RA 7160, and other pertinent laws and regulations, and are to be converted to such uses. However, for those reclassified prior to 15 June 1988, the guidelines in securing an exemption clearance from the DAR shall apply. SECTION 4. Areas Non-Negotiable for Conversion An application involving areas non-negotiable for conversion shall not be given due course even when some portions thereof are eligible for conversion. The following areas shall not be subject to conversion: 4.1. Lands within protected areas designated under the NIPAS, including mossy and virgin forests, riverbanks, and swamp forests or marshlands, as determined by the DENR; 4.2. All irrigated lands, as delineated by the DA and/or the National Irrigation Administration (NIA), where water is available to support rice and other crop production, and all irrigated lands where water is not available for rice and other crop production but are within areas programmed for irrigation facility rehabilitation by the government; 4.3. All irrigable lands already covered by irrigation projects with firm funding commitments, as delineated by the DA and/or NIA; and 4.4. All agricultural lands with irrigation facilities. SECTION 5. Areas Highly Restricted from Conversion The following areas/projects are classified as highly restricted from conversion: 5.1. Irrigable lands not covered by irrigation projects with firm funding commitment;

5.2. Agro-industrial croplands, or lands presently planted to industrial crops that support the economic viability of existing agricultural infrastructure and agro-based enterprises; 5.3. Highlands or areas located in elevations of five hundred (500) meters or above and which have the potential for growing semi-temperate or high value crops; 5.4. Lands issued with notice of land valuation and acquisition, or subject of a perfected agreement between the landowner and the beneficiaries under the Voluntary Land Transfer (VLT)/Direct Payment Scheme (DPS) under the CARP; and 5.5. Lands within an Environmentally Critical Area (ECA) or those involving the establishment of an Environmentally Critical Project (ECP). Applications for conversion under this sub-section shall require, apart from the standard, requirements, an Environmental Compliance Certificate (ECC) which the applicant must secure from the DENR prior to application (for ordinary applications) or prior to commencement of actual land development (for applications involving housing projects). The Presidential Agrarian Reform Council (PARC) Land Use Technical Committee (PLUTC) shall participate in the deliberations when the application involves land that is highly restricted from conversion and with an area larger than five (5) hectares, except housing projects covered by EO-45-2001. SECTION 6. Priority Development Areas and Projects. 6.1. In accordance with RA 7916, EO-124-1993, and EO-258-2000, the following are priority development areas for land conversion: 6.1.1. Specific sites in Regional Agri-Industrial Centers/Regional Industrial Centers (RAIC/RIC) identified by the Department of Trade and Industry (DTI) and the DA pursuant to EO-124-1993. 6.1.2. Tourism Development Areas (TDA) identified by the Department of Tourism (DOT) pursuant to EO124-1993. 6.1.3. Agricultural areas intended for Eco Zone Projects, endorsed by Philippine Economic Zone Authority (PEZA), pursuant to RA 7916. 6.1.4. Agricultural land, owned by the government, to be converted for projects of national interest, as certified by proper government agency. 6.1.5. Agricultural land proposed to be developed as sites for processing plants of agricultural products, as certified by the Department of Agriculture.

6.1.6. Sites intended for telecommunication facilities endorsed by the National Telecommunications Commission. 6.2. Housing projects are priority development projects for land conversion that shall follow the fast-tracking scheme prescribed under EO-45-2001. When the application involves a mixed use of housing and non-housing projects, the application shall not enjoy the privileges of housing projects unless at least eighty percent (80%) of the land applied for conversion shall be used directly and exclusively for housing. SECTION 7. Lands within SAFDZ. In accordance with Section 9 of RA 8435, the following rules shall govern conversion of lands within SAFDZ: 7.1. All irrigated lands, irrigable lands already covered by irrigation projects with firm funding commitments, and lands with existing or having the potential for growing high-value crops included within the SAFDZ shall be subject to a conversion moratorium for a period of five (5) years from 10 February 1998 to 9 February 2003. 7.2. During the effectivity of the moratorium, conversion may be allowed with respect to only five percent (5%) of said lands within SAFDZ upon compliance with existing laws, rules and regulations. 7.3. The maximum of five percent (5%) of land(s) eligible for conversion to non-agricultural use from the total SAFDZ area shall be jointly determined by the DA and the DAR, upon the recommendation of the Regional and National SAFDZ Committees pursuant to Rule 9.5.2 of DA-AO-6-1998, or the implementing rules and regulations of RA 8435. 7.4. After the expiration of the conversion moratorium, conversion may be allowed on a case-to-case basis, subject to existing laws, rules and regulations on land use conversion. ARTICLE III Procedures SECTION 8. Criteria for Conversion. The following criteria shall guide the resolution of application for conversion: 8.1. Conversion may be allowed if the land subject of application is not among those considered non-negotiable for conversion as provided in Section 4 hereof. 8.2. Conversion may be allowed, in accordance with Section 65 of RA 6657, when the land has ceased to be economically feasible and sound for agricultural purposes or the locality has become urbanized and the land will have a greater economic value for residential, commercial, industrial, or other non-agricultural purposes. ICTcDA 8.3. Conversion of lands within SAFDZ, as provided in Rule 9.5.2 of DA-AO-6-1998, shall take into account the following factors: 8.3.1. The conversion of land use is consistent with the natural expansion of the municipality or locality, as contained in the approved physical framework and land use plan. 8.3.2. The area to be converted in use is not the only remaining food production area of the community. 8.3.3. The land use conversion shall not hamper the availability of irrigation to nearby farmlands. 8.3.4. The areas with low productivity will be accorded priority for land use conversion. 8.3.5. Sufficient disturbance compensation shall be given to farmers whose livelihood are negatively affected by the land use conversion as provided for by existing laws and regulations. 8.4. When the agricultural land which is the subject of the application for conversion has been acquired under RA 6657, its conversion shall be allowed only if the applicant is the agrarian reform beneficiary thereof, and after he has fully paid his obligation as required under Section 65 of RA 6657. SECTION 9. Who May Apply for Conversion. The following persons may apply for conversion: 9.1. Owners of private agricultural lands or other persons duly authorized by the landowner;

9.2. Beneficiaries of the agrarian reform program after the lapse of five (5) years from award, reckoned from the date of the issuance of the Certificate of Landownership Award (CLOA), and who have fully paid their obligations and are qualified under these Rules, or persons duly authorized by them; and 9.3. Government agencies, including government-owned or controlled corporations, and LGUs, which own agricultural lands as their patrimonial property. SECTION 10. Documentary Requirements. The applicant shall submit in sextuplicate the following documents in six (6) separate bound folders (one [1] original set and five [5] photocopy sets) with table of contents and page numbers of all documents including photographs, sequentially numbered, except for maps and development plans which shall

likewise be in sextuplicate but shall be submitted in six separate envelopes with contents properly labeled on each envelope. Of the six (6) folders, two (2) will be transmitted to the Municipal Agrarian Reform Officer (MARO), containing therein only the filled-up application form and the documents specified in 10.4, 10.5 and 10.26 hereunder. The remaining four folders shall contain all the documents enumerated hereunder that are applicable. The arrangement thereof shall follow the sequence of the enumeration below, with the requirement referred to in Section 10.1 hereof being the first document after the table of contents: 10.1. Official receipt showing proof of payment of filing fee and inspection cost. 10.2. Official receipt showing proof of posting of bond in accordance with the terms and conditions set forth in Section 24 hereof. 10.3. Duly accomplished application for conversion subscribed and sworn to before a notary public or any person authorized to administer oaths. 10.4. True copy of the Original Certificate of Title (OCT) or Transfer Certificate of Title (TCT) of the subject land, certified by the Register of Deeds not earlier than thirty (30) days prior to application filing date. In case of untitled land, the following shall be required in lieu of a title: 10.4.1. 10.4.2. Certification from the DENR Community Environment and Natural Resources Officer (CENRO) that the landholding has been classified as alienable and disposable; and Certification from the DENR CENRO (for administrative confirmation of imperfect title) or the Clerk of Court (for judicial confirmation of imperfect title) that the titling process/proceedings has commenced and there are no adverse claimants;

10.5. True copy of the Certificate of Title of the subject land as of 15 June 1988, and all successor Titles until the present Title referred to in Section 10.4 hereof, if applicable. 10.6. True copy of the current Tax Declaration covering the subject property. 10.7. Project feasibility study. 10.8. Joint venture agreement or any other business arrangement on the use of the land between the landowner and the developer (if the developer is other than the landowner) or between the EP/CLOA holders and the developer (if the land was awarded under the agrarian reform program). 10.9. Narrative description of the development plan describing in detail the activities, program components, phasing, schedule, work and financial plan, all duly certified by a licensed engineer, architect, or land use planner. 10.10. Proof of financial and organizational capability of the developer to develop land, including the following information: 10.10.1. Statement of project cost and availability of potential funding source(s) for the development of the proposed project; 10.10.2. Profile of the developer;

10.10.3. Most recent financial statement, not later than the year before application, duly authenticated by a certified public accountant; and 10.10.4. If the developer is a corporation or partnership, a copy of its Certificate of Registration and recent General Information Sheet (GIS) for the immediately preceding year, certified by the Securities and Exchange Commission (SEC), or in lieu of the latter, a duly accomplished GIS sworn to before a notary public, provided, that if the land is to be used for socialized housing by the LGU under EO 124-1993, a Sanggunian Resolution appropriating funds for the project and authorizing the LGU to undertake the same shall be required: Provided, further, that if the socialized housing shall be undertaken by other government agencies such as the National Housing Authority and the like, a board resolution approving the project and appropriating funds therefor shall likewise be submitted. 10.11. Socio-Economic Benefit-Cost Study of the proposed project. 10.12. Photographs, size 5R (five [5] inches by seven [7] inches), using color film, and taken on the landholding under sunlight. The applicant shall attach the pictures to a paper background and the photographer who took said pictures shall sign on said paper background to certify the authenticity of the pictures. On each background paper shall be written a short description of each picture. The pictures shall consist of: 10.12.1. At least four (4) photographs taken from the center of the landholding: one (1) facing north, one (1) facing east, one (1) facing south, and one (1) facing west; 10.12.2. At least one (1) photograph per corner, taken from each corner of the landholding's borders.

10.12.3. At least two (2) photographs each for all distinct man-made structures existing on the land, taken from opposite angles; 10.12.4. At least two (2) photographs each of the front view of the billboard(s) required in Section 11 hereof. The applicant shall set aside the second copy of said billboard photograph(s) for submission to the MARO; and 10.12.5. Sufficient number of photographs of the most conspicuous landmarks from the nearest barangay center and leading to and from the ingress and egress routes at the subject landholding, for the purpose of assisting the ocular inspection team in locating the site. 10.13. Affidavit/Undertaking in a single document of the applicant stating: 10.13.1. The number and names of the farmers, agricultural lessees, share tenants, farmworkers, actual tillers, and/or occupants in the landholding; if there are no such persons, a statement attesting to such fact; 10.13.2. That the applicant has paid or shall pay disturbance compensation to the persons mentioned in Section 10.13.1 hereof, in accordance with the computation, and under the terms and conditions, in Section 28 hereof; 10.13.3. That the applicant has erected the required number of billboards and undertakes not to remove, deface or destroy said billboard, and that he shall repair or replace the same when damaged, until after the approving authority disposes of the application with finality; 10.13.4. That the applicant has not undertaken and shall not undertake premature development prior to issuance of a Conversion Order; 10.13.5. That he authorizes the DAR to forfeit his bond when he undertakes any premature development within the area before or after filing of the application for conversion; and 10.13.6. That he has not commenced any action or filed any claim involving the same land in any court, tribunal or quasi-judicial agency; to the best of his knowledge, no such other action or claim is pending therein; he has no knowledge of any controversy or proceeding involving the status of said parcel of land or the rights of person over its possession and entitlement to fruits or as beneficiary, the determination of which is filed before any tribunal, court, the DAR or any other agency; to his own knowledge, no such action or proceeding is pending in any court, tribunal, or quasi-judicial agency; and should there be any same or similar action or proceeding involving the property applied for conversion, which is either pending or may have been terminated, he shall report such fact within five (5) days from knowledge thereof to the approving authority where his aforesaid application has been filed. 10.14. Certification of the MARO in a single document attesting compliance with Section 14.1 hereof. 10.15. Certification from the HLURB Regional Officer on the actual zoning or classification of the land subject of the application on the approved comprehensive land use plan citing: (a) the municipal or city zoning ordinance number; and (b) resolution number and date of approval by the HLURB or the Sangguniang Panlalawigan concerned, as the case may be. 10.16. Certification from the authorized DA official stating, among others, the classification of the property under the NPAAAD/SAFDZ, whether or not the subject property is within the five percent (5%) limit of the SAFDZ allowed for conversion and whether the land has ceased to be economically feasible and sound for agricultural purposes. As provided for in DA-AO-2-2002, Article VI, Paragraph "4.2", the certification inventory must include the following information: 10.16.1. Location and accessibility;

10.16.2. Limitations to agricultural production, such as steep slope, unstable soil condition (landslide, etc.); inadequate land drainage; very shallow, stony, rocky soil; very serious boulder problem; 10.16.3. 10.16.4. 10.16.5. 10.16.6. 10.16.7. Existing land use; Indication of premature development or alteration of land use (with picture); Land use of adjoining area; Indication of non-agricultural development; and Potential for agricultural production.

In the event the land being applied for is within the 5% allowable limit under Section 9 of RA 8435, the investigation report accompanying the inventory should also include the following information: 10.16.8. Total area of the SAFDZ;

10.16.9. 10.16.10. 10.16.11. 10.16.12.

Allowable 5% limit; Total area already approved for reclassification by the DA; Balance of the 5% allowable area; and Balance of the 5% allowable area if the application is approved.

10.17. Certification from the authorized DENR official stating, among others, whether or not the subject land is within the NIPAS, mossy and virgin forests, riverbanks, or swamp forests and marshlands; within an ECA, or will involve the establishment of an ECP. 10.18. Environmental Compliance Certificate (ECC) when the subject land is within an ECA or will involve the establishment of an ECP. 10.19. If applicable, Special Power of Attorney (SPA), when the applicant is not the registered owner. 10.20. If applicable, notarized secretary's certificate of a corporate/cooperative board resolution authorizing the representative, when the applicant is a corporation or cooperative. 10.21. If applicable, concurrence letter of the mortgagee or of the individual or entity in whose favor the encumbrance was constituted, when the property is encumbered. 10.22. If applicable, endorsement from the concerned government agency, when the application involves a priority development area or project. 10.23. If applicable, Land Bank of the Philippines (LBP) certification attesting that the applicant-landowner has fully paid his obligations to the LBP, when the applicant-landowner is a beneficiary of the agrarian reform program. 10.24. If applicable, Provincial Agrarian Reform Officer (PARO) certification attesting that the applicant-landowner acquired the subject land from a landed-estate or under the Voluntary Land Transfer/Direct Payment Scheme (VLT/DPS) and he has already fully paid his obligation thereunder, when the applicant-landowner is a beneficiary of the agrarian reform program. 10.25. Vicinity map and a lot plan prepared by a duly-licensed geodetic engineer indicating the lots being applied for and their technical descriptions, name of owner/s, lot number and area. The map shall highlight the specific area applied for conversion if the application covers less than the total lot area. 10.26. Directional sketch map showing the orientation of the subject property in relation to adjoining lands and nearest provincial and/or national and/or feeder roads, to facilitate and determine the location of the property for the purpose of ocular inspection. The map shall: indicate the existing infrastructure and/or improvements thereon including any house or tillage thereupon of any occupant therein; landmarks within a one (1) kilometer radius; and owners of adjacent properties. The map need not be drawn to scale. 10.27. Map of the development plan. For socialized housing projects, blueprint copy of the development plan submitted and certified by the HLURB as basis for its certification that the project conforms with the minimum standards of Batas Pambansa Bilang 220. 10.28. Topographic Map if the subject property is within an upland, hilly or mountainous area. As a general rule, the applicant shall submit all the foregoing applicable requirements from Sections 10.1 to 10.28 hereof at the time of application filing. However, for applications involving housing projects under EO-452001, he may defer the submission of the requirements mentioned in Sections 10.15 to 10.18 hereof and follow the alternative timetable in Sections 22.9.2 and 22.21 hereof. SECTION 11. Public Notice The applicant shall post, in a conspicuous place(s) within the subject property, a public notice contained in a billboard made of strong weather-resistant material such as plywood, galvanized iron, tin, panaflex, or other similar durable material, measuring 1.22 meters by 2.44 meters (4 feet by 8 feet). If the landholding has an area of more than twenty (20) hectares, the applicant shall erect one (1) billboard for every twenty (20) hectares, on strategic and visible points in the landholding, preferably along a road. The billboard shall be written in the local dialect and shall display all the information mentioned below, to wit: 11.1. Statement that the applicant is proposing to convert the subject landholding from agricultural to nonagricultural use; 11.2. Complete name of the landowner(s) and applicant(s) and developer(s); 11.3. Total area and exact location of the conversion proposal; 11.4. Filing date of application for conversion; 11.5. Date of posting of billboard;

11.6. Schedule of ocular inspection; 11.7. Deadline for filing protest; 11.8. Address of the CLUPPI and RCLUPPI and PARO where oppositors may formally file their protest; 11.9. Address of the approving authority; and 11.10. Date of approval or denial of the application, which shall be left blank, and which the applicant shall fill up upon approval or denial of the application. SECTION 12. Where to file application and Approving Authority. 12.1. Duly accomplished and notarized application forms and the complete documentary requirements sit forth in Section 10 hereof shall be filed with the following offices: 12.1.1. Regional Center for Land Use Policy Planning and Implementation (RCLUPPI), located at the DAR Regional Office, for applications involving lands with an area less than or equal to five (5) hectares, or a fraction above five (5) hectares. The Regional Director shall be the approving authority for such applications; and Center for Land Use Policy Planning and Implementation (CLUPPI), located at the DAR Central Office, for applications involving lands with an area larger than five (5) hectares. The Secretary shall be the approving authority for such applications and may delegate the same authority to any Undersecretary.

12.1.2.

12.2. When the application concerns a parcel of land that is adjacent to another parcel of land that was previously granted a Conversion Order, and the sum of the areas of both adjoining parcels of land exceeds five (5) hectares, the approving authority for the present application shall be the Secretary, acting upon the recommendation of the CLUPPI. 12.3. When the applicant owns or represents the owner(s) of two (2) or more parcels of land within the same barangay or within two (2) or more barangays that are adjacent to each other, and the sum of the areas of said parcels of land exceeds five (5) hectares, the approving authority for an application involving any of said parcels of land shall be the Secretary, acting upon the recommendation of the CLUPPI. 12.4. When a single project proposes the conversion of two (2) or more parcels of land with different owners but within the same barangay or within two (2) or more barangays that are adjacent to each other, and the sum of the areas of said parcels of land exceeds five (5) hectares, the approving authority for an application involving any of said parcels of land shall be the Secretary, acting upon the recommendation of the CLUPPI. 12.5. When the applicant or any oppositor challenges the jurisdiction of the approving authority on the ground of error in computation of jurisdictional area, and a higher authority takes cognizance of the dispute, the DAR approving authority shall hold in abeyance the application for conversion until said higher authority determines with finality the correct jurisdictional area. 12.6. Except in housing projects, the PLUTC shall act as the recommending body when the application involves lands with an area larger than five (5) hectares and which is highly restricted from conversion as per Section 5 hereof, or when, in the opinion of the Secretary, the application requires inter-agency inputs that are crucial for its judicious disposition. 12.7. The CLUPPI shall organize a Secretariat that shall be responsible for processing all land use conversion applications and shall be the repository of all records pertaining thereto. The CLUPPI/RCLUPPI shall be a one-stop processing center for conversion applications undertaken in line with housing projects under EO-45-2001. The RCLUPPI shall adopt the standard docketing system, and adopt its own document-tracing system, and shall forward to the CLUPPI all its decisions/resolutions/final orders, together with its quarterly statistic report on land use conversion applications, for monitoring and consolidation of status reports by the CLUPPI and safekeeping of the decisions/resolutions/final orders by the Records Division. The CLUPPI shall be responsible for the centralized printing of all applications for land use conversion. SECTION 13. Filing Fee and Inspection Cost. 13.1. Filing Fee: 13.1.1. One thousand (1,000) pesos for applications involving lands with an area less than or equal to five (5) hectares; or 13.1.2. hectares. Two thousand (2,000) pesos for applications involving lands with an area larger than five (5)

13.2. Inspection Cost:

13.2.1.

For applications involving lands with an area less than or equal to five (5) hectares:

13.2.1.1. Ten thousand (10,000) pesos if the subject landholding is within the same island as that of the Office of the Regional Director; or 13.2.1.2. Fifteen thousand (15,000) pesos if the subject landholding is not within the same island as that of the Office of the Regional Director. 13.2.2. For applications involving lands with an area larger than five (5) hectares: if the subject landholding is within the

13.2.2.1. Ten thousand (10,000) pesos main islandof Luzon (except Bicol peninsula);

13.2.2.2. Fifteen thousand (15,000) pesos if the subject landholding is within Regions I to IV but is not located within the main island of Luzon; 13.2.2.3. Fifteen thousand (15,000) pesos if the subject landholding is in Bicol Peninsulaor Visayas group of islands; or 13.2.2.4. islands. Twenty thousand (20,000) pesos if the subject landholding is in the Mindanaogroup of

SECTION 14. MARO Certification. 14.1. Upon accomplishing the application form, the applicant shall furnish the MARO with a photocopy of the same, together with a photocopy of the title(s) in Sections 10.4 and/or 10.5 hereof and directional sketch map in Section 10.26 hereof. Upon receipt thereof, the MARO shall: 14.1.1. 14.1.2. check the status of CARP coverage on and around the subject land; inspect the applicant's billboard posting;

14.1.3. check the presence of any farmer, agricultural lessee, share tenant, farm worker, actual tiller, or occupant; and 14.1.4. post the notices of application in a conspicuous place in the municipality and a conspicuous place in the barangay covering the subject land (or a larger portion of the subject land for properties that overlap on more than one barangay). Thereafter, the MARO shall accomplish a certification of his findings thereon, furnishing the applicant with the original copy of the certificate, as required under Section 10.14 hereof. 14.2. For housing projects under EO-45-2001, if the MARO fails to act upon the request for certification within ten (10) days from receipt of request, the applicant shall notify the RCLUPPI/CLUPPI of such failure by personally filing an affidavit reporting such inaction. The RCLUPPI/CLUPPI shall investigate the reason for the non-issuance and take the steps necessary for the judicious resolution of the pending application for conversion. Simultaneously, the disciplining authority of the DAR shall, after proper investigation, impose upon the erring MARO the proper administrative sanction(s). SECTION 15. Ocular Inspection. 15.1. The ocular inspection shall be conducted on the property by the RCLUPPI/CLUPPI. 15.2. The team designated to conduct ocular inspection shall verify and evaluate the following: 15.2.1. Veracity of information contained in the application for land use conversion;

15.2.2. Description of the property(ies) applied for conversion, including among others the location, terrain/topography, land cover and dominant land use of the subject land and the surrounding areas; 15.2.3. Status of the coverage under CARP of the land applied for conversion;

15.2.4. Whether or not the land applied for conversion falls within the appropriate zone in the land use plan of the city or municipality; 15.2.5. Existence of farmers, agricultural lessees, share tenants, farmworkers, actual tillers, and/or occupants on the subject land; 15.2.6. Whether or not the farmers, agricultural lessees, share tenants, farmworkers, actual tillers, and/or occupants have been paid or have agreed to the terms of the disturbance compensation due them; and 15.2.7. Other information, relevant and useful in deciding whether to approve/disapprove the application for conversion.

15.3. The Barangay Agrarian Reform Council (BARC) and Barangay Chairman shall be notified of the ocular inspection but their presence is not mandatory. SECTION 16. Protest. Persons affected by the proposed land use conversion, such as identified beneficiaries, farmers, agricultural lessees, share tenants, actual tillers, occupants, or residents of adjoining properties or communities, may file a written protest against the application for conversion within thirty (30) days from posting of the requisite billboard(s) under Section 11 hereof, or within fifteen (15) days from conduct of ocular inspection, whichever is later. For applications involving housing projects under EO-45-2001, the protest period shall be within seventeen (17) days from posting of the requisite billboard(s) under Section 11 hereof, or within five (5) days from conduct of ocular inspection, whichever is later. Thereafter, the RCLUPPI/CLUPPI shall furnish all oppositors with copies of all orders or actions taken relative to the subject application. An oppositor who is an identified Agrarian Reform-Beneficiary (ARB) of the land applied for conversion, and who failed to file a written protest within the protest period due to fraud, accident, mistake, or excusable neglect, may intervene at any time during the pendency of the application. The filing of any protest shall interrupt any running period for processing applications for conversion, and shall lift the deadline for approving or disapproving the application. SECTION 17. Where to file protest. Protests against the application for conversion shall be filed with the PARO and/or RCLUPPI and/or CLUPPI, as the case may be, by personal service, if feasible. An oppositor who files a protest before the PARO shall do so by personal service, not by mail. Upon receipt of a protest by personal service, the PARO shall, before the end of the next working day, communicate with the RCLUPPI/CLUPPI by telephone or text message, to inform the members thereof of such protest, and send a corresponding telegram and/or radiogram which shall serve as written proof of compliance with the protest notification requirement herein. Within four (4) working days from receipt of the protest, the PARO shall transmit, by courier or speed delivery, to the RCLUPPI/CLUPPI the original copy of the protest itself, and keep a photocopy thereof in his custody. Failure of the PARO to comply with the directive under this Section shall subject him to the appropriate disciplinary action. SECTION 18. Examination of Records. Any interested person or his duly authorized representative or counsel may request from the CLUPPI/RCLUPPI or PARO/MARO a copy of the application, including the attachments thereto, but not the DAR inter-office endorsement/recommendation and other documents as set forth in DAR MC-25-1995. The CLUPPI/RCLUPPI shall not divulge its recommendation so as not to pre-empt the final decision of the proper approving authority. SECTION 19. Resolution of Protest. The approving authority shall resolve the protest simultaneously with the application for conversion. Whenever necessary, the approving authority may, motu propio or upon motion by any oppositor, issue a Cease and Desist Order (CDO). SECTION 20. Grounds for Protest/Denial of Conversion. Protests against the application and denial of the application may be instituted or founded on any of the following grounds: 20.1. The area under application is non-negotiable for conversion; 20.2. The adverse effects of the displacement to be caused by the proposed conversion far outweigh the social and economic benefits to the affected communities; 20.3. Misrepresentation or concealment of facts material to the application for conversion; 20.4. Illegal or premature conversion; 20.5. Existence of proof that conversion was resorted to as a means to evade CARP coverage and to dispossess the tenant farmers of the land tilled by them. 20.6. The land applied for conversion has not ceased to be economically feasible and sound for agricultural purposes, or the locality where it is found has not become urbanized and the land will not have a greater economic value for residential, commercial or industrial purposes. (Section 65 of RA 6657) 20.7. The applicant has violated, or the application for conversion is violative, of agrarian laws, rules and regulations as well as other applicable statutes and other administrative issuances. SECTION 21. Processing of Applications. The following steps are the procedure for ordinary conversions that do not involve "priority development areas and projects" nor housing projects under Section 6 hereof: 21.1. The applicant shall first secure an Application Form from the RCLUPPI or CLUPPI. 21.2. Following the instructions that accompany the Application Form, the applicant shall install the public notice billboard(s) required under Section 11 hereof. 21.3. Immediately thereafter, the applicant shall fill up the Application Form with all the necessary data. He shall reproduce at least five (5) clear photocopies of the accomplished Application Form and place them in five (5) separate folders (plus a sixth folder for the original set), the distribution of which shall be as follows:

21.3.1. The original copy for the RCLUPPI/CLUPPI (the receiving clerk must rubberstamp the words "ORIGINAL" on the original copy); 21.3.2. 21.3.3. Three (3) photocopies for the RCLUPPI/CLUPPI; and Two (2) photocopies which the applicant shall furnish to the MARO as advance copies.

21.4. When furnishing the MARO with folders of the application, the applicant shall attach to the filled-up application form, clear photocopies of the: 21.4.1. 21.4.2. Title(s) required under either Section 10.4 and/or Section 10.5 hereof, and Directional sketch map required under Section 10.26 hereof.

21.5. Within five (5) days from receipt of the folders containing the documents in Section 21.4 hereof, the MARO shall keep one folder for himself and transmit the other folder to the PARO. 21.6. Within twenty (20) days from receipt of the above folder, the MARO shall: check the status of CARP coverage on the subject land; inspect the billboard; check presence of farmers, agricultural lessees, share tenants, farm workers, actual tillers, or occupants; post notices of the application in a conspicuous place in the municipality and a conspicuous place in the barangay covering the subject land (or a larger portion of the subject land for properties that overlap on more than one barangay); prepare a single-document MARO certification reporting the result of all the foregoing tasks; and make available to the applicant the original copy of said MARO certification. 21.7. If the MARO fails to act upon the request for issuance of the above certification within twenty (20) days from receipt of the request, the applicant shall notify the PARO and RCLUPPI/CLUPPI of such failure by personally filing an affidavit reporting such inaction. Within five (5) days from receipt of the affidavit of inaction, the PARO shall compel the MARO to act upon the request. If the MARO still refuses to act for no justifiable reason, the PARO shall, within twenty (20) days from receipt of the affidavit of inaction, perform by himself the duties abandoned by the MARO. Meantime, the disciplining authority of the DAR, shall, after proper investigation, impose upon said MARO the appropriate administrative sanction(s). 21.8. At this juncture, the applicant has four (4) application forms left after furnishing two (2) advance copies for the MARO and PARO. The applicant shall place said application forms in the remaining four (4) folders and all the applicable documentary requirements set forth in Section 10 hereof, all the originals being in one (1) folder, and the photocopies thereof being in the three (3) other folders. These four (4) folders shall be the initiatory pleading of the application for conversion. 21.9. The applicant shall submit to the RCLUPPI/CLUPPI the four (4) folders. The RCLUPPI/CLUPPI shall then review the completeness of the folders. If found complete, the applicant shall pay the filing fees and inspection cost (in accordance with Section 13 hereof) and post the necessary bond (in accordance with Section 24 hereof), after which the RCLUPPI/CLUPPI may accept the application. Acceptance date of the folders shall be the "Filing Date" of the application. 21.10. The distribution of the four (4) folders shall be as follows: The RCLUPPI/CLUPPI shall keep a folder containing the originals and a folder containing photocopies. At the same time, the RCLUPPI/CLUPPI Secretariat shall transmit the remaining two (2) folders to the PARO and MARO respectively. Immediate transmittal of said folders is important because the PARO shall utilize the information therein when acting upon any protest against the application, or when issuing any comment that he may wish to submit to the RCLUPPI/CLUPPI in connection with the application. 21.11. Within ten (10) days from Filing Date, the RCLUPPI/CLUPPI shall issue to the applicant a Notice of Conduct of Ocular Inspection, indicating the date thereof. The ocular inspection shall be held not earlier than ten (10) days nor later than twenty (20) days from issuance date of the Notice of Conduct of Ocular .Inspection. The RCLUPPI/CLUPPI shall inform the MARO by the fastest means of communication of the date of ocular inspection with instructions to ensure dissemination of the Notice to all farmers, agricultural lessees, share tenants, farmworkers, actual tillers, or occupants in the subject landholding. 21.12. The applicant shall transmit said Notice to the MARO and indicate the ocular inspection date on the billboard(s) at least five (5) days before conduct of ocular inspection. On or before ocular inspection date, the applicant shall submit to the RCLUPPI/CLUPPI a proof that the MARO was able to receive a copy of said Notice. 21.13. The RCLUPPI/CLUPPI shall then conduct ocular inspection, and if possible, hold a dialogue with the farmers, agricultural lessees, share tenants, farmworkers, actual tillers, or occupants found in the subject landholding. 21.14. The RCLUPPI/CLUPPI ocular inspection team shall, within five (5) days from conduct of ocular inspection, accomplish an Investigation Report which shall include the result of its dialogue.

21.15. The RCLUPPI/CLUPPI shall deliberate on the merits of the application and may call the applicant and/or oppositor(s), if any, for clarificatory questioning, to judiciously resolve any dispute arising from the application. The RCLUPPI shall invite the PARO to participate in the deliberations. Upon his discretion, the PARO may submit a written comment to the RCLUPPI/CLUPPI. 21.16. Within sixty (60) days from issuance of the MARO certification, but not later than eighty (80) days from Filing Date, the RCLUPPI/CLUPPI shall forward its recommendation, together with the records, to the approving authority. 21.17. Within thirty (30) days from submission of the recommendation, the approving authority shall resolve the application and furnish copies of the decision to the applicant and oppositor(s), if any. 21.18. The filing of any protest shall interrupt any running period for processing applications for conversion and shall lift the deadline for approving or disapproving the application. Upon receipt of a protest, the RCLUPPI/CLUPPI shall order the filing of a comment, reply, rejoinder, and such other pleadings that may aid in a judicious resolution of the protest issues, and thereafter schedule hearings where the parties may present their respective evidence. After conclusion of the hearings, the RCLUPPI/CLUPPI shall submit its recommendation to the approving authority which shall resolve the protest simultaneously with the application. SECTION 22. Processing of Applications Involving Priority Development Areas and Projects . Applications involving "priority development areas and projects" under Section 6.1 hereof, and housing projects under Section 6.2 hereof, shall follow the following steps: 22.1. The applicant shall first secure an Application Form from the RCLUPPI or CLUPPI. 22.2. Following the instructions that accompany the Application Form, the applicant shall install the public notice billboard(s) required under Section 11 hereof. 22.3. Immediately thereafter, the applicant shall fill up the Application Form with all the necessary data. He shall reproduce at least five (5) clear photocopies of the accomplished Application Form and place them in five (5) separate folders (plus a sixth folder for the original set), the distribution of which shall be as follows: 22.3.1. The original copy for the RCLUPPI/CLUPPI (the receiving clerk must rubberstamp the words "ORIGINAL" on the original copy); 22.3.2. 22.3.3. Three (3) photocopies for the RCLUPPI/CLUPPI; and Two (2) photocopies which the applicant shall furnish to the MARO as advance copies.

22.4. When furnishing the MARO with folders of the application, the applicant shall attach to the filled-up application form, clear photocopies of the: 22.4.1. 22.4.2. Title(s) required under either Section 10.4 and/or Section 10.5 hereof; and Directional sketch map required under Section 10.26 hereof.

22.5. Within five (5) days from receipt of the folders containing the documents in Section 22.4 hereof, the MARO shall keep one folder for himself and transmit the other folder to the PARO. 22.6. MARO certification: 22.6.1. Priority development areas and projects under Section 6.1 hereof . Within twenty (20) days from receipt of the above folder, the MARO shall: check the status of CARP coverage on the subject land; inspect the billboard; check presence of farmers, agricultural lessees, share tenants, farm workers, actual tillers, or occupants; post notices of the application in a conspicuous place in the municipality and a conspicuous place in the barangay covering the subject land (or a larger portion of the subject land for properties that overlap on more than one barangay); prepare a single-document MARO certification reporting the result of all the foregoing tasks; and make available to the applicant the original copy of said MARO certification. 22.6.2. Housing projects under Section 6.2 hereof (EO-45-2001). Within ten (10) days from receipt of the above folder, the MARO shall: check the status of CARP coverage on the subject land; inspect the billboard; check presence of farmers, agricultural lessees, share tenants, farm workers, actual tillers, or occupants; post notices of the application in a conspicuous place in the municipality and a conspicuous place in the barangay covering the subject land (or a larger portion of the subject land for properties that overlap on more than one barangay); prepare a single-document MARO certification reporting the result of all the foregoing tasks; and make available to the applicant the original copy of said MARO certification. 22.7. MARO inaction: 22.7.1. Priority development areas and projects under Section 6.1 hereof. If the MARO fails to act upon the request for issuance of the above certification within twenty (20) days from receipt of the request, the

applicant shall notify the PARO and RCLUPPI/CLUPPI of such failure by personally filing an affidavit reporting such inaction. Within five (5) days from receipt of the affidavit of inaction, the PARO shall compel the MARO to act upon the request. If the MARO still refuses to act for no justifiable reason, the PARO shall, within twenty (20) days from receipt of the affidavit of inaction, perform by himself the duties abandoned by the MARO. Meantime, the disciplining authority of the DAR shall, after proper investigation, impose upon said MARO the appropriate administrative sanction(s). 22.7.2. Housing projects under Section 6.2 hereof (EO-45-2001). If the MARO fails to act upon the request for said certification within ten (10) days from receipt of the request, the applicant shall notify the RCLUPPI/CLUPPI of such failure by personally filing an affidavit reporting such inaction. The RCLUPPI/CLUPPI shall investigate the reason for the non-issuance and take the steps necessary for the judicious resolution of the pending application for conversion. Simultaneously, the disciplining authority of the DAR shall, after proper investigation, impose upon the erring MARO the proper administrative sanction(s). 22.8. At this juncture, the applicant has four (4) application forms left after furnishing two (2) advance copies for the MARO and PARO. The applicant shall place said application forms in the remaining four (4) folders and all the applicable documentary requirements set forth in Section 10 hereof, all the originals being in one (1) folder, and the photocopies thereof being in the three (3) other folders. These four (4) folders shall be the initiatory pleading of the application for conversion. 22.9. Filing Date: 22.9.1. Priority development areas and projects under Section 6.1 hereof . The applicant shall submit to the RCLUPPI/CLUPPI the four (4) folders containing all the applicable documentary requirements set forth in Section 10 hereof. The RCLUPPI/CLUPPI shall then review the completeness of the application. If found complete, the applicant shall pay the filing fee and inspection cost (in accordance with Section 13 hereof) and post the necessary bond (in accordance with Section 24 hereof), after which the RCLUPPI/CLUPPI may accept the application. Acceptance date of the folders shall be the "Filing Date" of the application. 22.9.2. Housing projects under Section 6.2 hereof (EO-45-2001). The applicant shall submit to the RCLUPPI/CLUPPI the four (4) folders containing all the applicable requirements set forth in Section 10 hereof except those in Sections 10.15 to 10.18 (certifications from the HLURB, DA, and DENR) which the applicant may submit at a later time. The RCLUPPI/CLUPPI shall then review the completeness of the application. If found complete, the applicant shall pay the filing fee and inspection cost (in accordance with Section 13 hereof) and post the necessary bond (in accordance with Section 24 hereof), after which the RCLUPPI/CLUPPI may accept the application. Acceptance date of the folders shall be the "Filing Date" of the application. 22.10. The distribution of the four (4) folders shall be as follows: The RCLUPPI/CLUPPI shall keep a folder containing the originals and a folder containing photocopies. At the same time, the RCLUPPI/CLUPPI Secretariat shall transmit the remaining two (2) folders to the PARO and MARO respectively. Immediate transmittal of said folders is important because the PARO shall utilize the information therein when acting upon any protest against the application, or when issuing any comment that he may wish to submit to the RCLUPPI/CLUPPI in connection with the application. 22.11. Within five (5) days from Filing Date, the RCLUPPI/CLUPPI shall issue to the applicant a Notice of Conduct of Ocular Inspection, indicating the date thereof. The ocular inspection shall be held not earlier than ten (10) days nor later than fifteen (15) days from issuance date of the Notice of Conduct of Ocular Inspection. The RCLUPPI/CLUPPI shall inform the MARO by the fastest means of communication of the date of ocular inspection with instructions to ensure dissemination of the Notice to all farmers, agricultural lessees, share tenants, farmworkers, actual tillers, or occupants in the subject landholding. 22.12. The applicant shall transmit said Notice to the MARO and indicate the ocular inspection date on the billboard(s) at least five (5) days before conduct of ocular inspection. On or before ocular inspection date, the applicant shall submit to the RCLUPPI/CLUPPI a proof that the MARO was able to receive a copy of said Notice. 22.13. The RCLUPPI/CLUPPI shall then conduct ocular inspection, and if possible, hold a dialogue with the farmers, agricultural lessees, share tenants, farmworkers, actual tillers, and/or occupants found in the subject landholding. 22.14. The RCLUPPI/CLUPPI ocular inspection team shall, within five (5) days from conduct of ocular inspection, accomplish an Investigation Report which shall include the result of its dialogue. 22.15. The RCLUPPI/CLUPPI shall deliberate on the merits of the application and may call the applicant and/or oppositor(s), if any, for clarificatory questioning to judiciously resolve any dispute arising from the application. The

RCLUPPI shall invite the PARO to participate in the deliberations. Upon his discretion, the PARO may submit a written comment to the RCLUPPI/CLUPPI. 22.16. RCLUPPI/CLUPPI recommendation: 22.16.1. Priority development areas and projects under Section 6.1 hereof . Within forty (40) days from issuance of the MARO certification, but not later than sixty (60) days from Filing Date, the RCLUPPI/CLUPPI shall forward its recommendation, together with the records, to the approving authority. 22.16.2. Housing projects under Section 6.2 hereof (EO-45-2001). Within thirty (30) days from issuance of the MARO certification or filing of affidavit of MARO inaction, but not later than forty (40) days from Filing Date, the RCLUPPI/CLUPPI shall forward its recommendation, together with the records, to the approving authority. 22.17. The filing of any protest shall interrupt the running period for processing applications for conversion and shall lift the deadline for approving or disapproving the application. Upon receipt of a protest, the RCLUPPI/CLUPPI shall order the filing of a comment, reply, rejoinder, and such other pleadings that may aid in a judicious resolution of the protest issues, and thereafter schedule hearings where the parties may present their respective evidence. After conclusion of the hearings, the RCLUPPI/CLUPPI shall submit its recommendation to the approving authority which shall resolve the protest simultaneously with the application. 22.18. Protests against applications involving housing projects shall likewise interrupt the running period and lift the deadline for approving or disapproving the application. In line with Section 4(c) of EO 45-2001, the RCLUPPI/CLUPPI shall make a preliminary determination on whether or not the protest stands on valid grounds. When the protest is prima facie meritorious, the RCLUPPI/CLUPPI shall order the filing of a comment, reply, rejoinder, and such other pleadings that may aid in a judicious resolution of the protest issues, and thereafter schedule hearings where the parties may present their respective evidence. After conclusion of the hearings, the RCLUPPI/CLUPPI shall submit its recommendation to the approving authority which shall resolve the protest simultaneously with the application. 22.19. Approving Authority Decision: 22.19.1. Priority development areas and projects under Section 6.1 hereof . Within thirty (30) days from submission of the recommendation, the approving authority shall resolve the application and furnish copies of the decision to the applicant and oppositor(s), if any. 22.19.2. Housing projects under Section 6.2 hereof (EO-45-2001). Within thirty (30) days from submission of the recommendation, the approving authority shall resolve the application and furnish copies of the decision to the applicant and oppositor(s), if any. The thirty (30) day period herein shall not run unless the applicant submits to the approving authority the requirements set forth in Sections 10.15 and 10.16 (certifications from the HLURB and DA). 22.20. In housing projects under EO-45-2001, when the approving authority finds the application meritorious, but the applicant has not yet submitted the necessary DENR certifications referred to in Sections 10.17 and 10.18 hereof, the approving authority shall not issue any Conversion Order, but may, in lieu thereof, issue a Provisional Conversion Order. A Provisional Conversion Order does not allow the applicant to undertake any development activity on the subject land. No reglementary period for filing a motion for reconsideration or appeal shall run upon the issuance of a Provisional Conversion Order. The issuance of the final Conversion Order or its denial shall be done only after the approving authority has received from the DENR: a certification that the subject land is not within the NIPAS; and an ECC or a certification that the same is not necessary. SECTION 23. Bond. To guarantee that the applicant shall not undertake premature conversion pending consideration of the application, and ensure faithful compliance with the conditions of the Conversion Order by the applicant/developer, cash or surety bonds shall be required pursuant to Section 35, Chapter 6, Book IV of theAdministrative Code of 1987. 23.1. No surety bond shall be acceptable except that issued by the Government Service Insurance System (GSIS), in line with the Office of the President (OP) Administrative Order (AO) No. 33 [25 August 1987], as amended by OP-AO-141 [12 August 1994], "Prescribing Guidelines for the Insurance of All Properties, Contracts, Rights of Action and other Insurance Risks of the Government, Including Those in Which the Government Has an Insurable Interest, with the General Insurance Fund of the Government Service Insurance System". This Guidelines expressly repeals all provisions in DAR-MC-9-1999 relating to posting of bond. 23.2. The PARO shall be the recommending authority in resolving all motions for withdrawal or refund of bond. SECTION 24. Bond To Guarantee Against Premature Conversion.

24.1. The applicant shall, upon filing of the application, post a cash bond equivalent to at least two point five percent (2.5%) of the zonal value of the land per latest issuance of the Department of Finance, in the form of cash or manager's/cashier's check posted in favor of the DAR. 24.2. In lieu of a cash bond, the applicant may post a surety bond, issued by the GSIS, equivalent to at least fifteen percent (15%) of the total zonal value of the land per latest issuance of the Department of Finance, indicating the following conditions at the minimum that: 24.2.1. The bond is callable on demand;

24.2.2. The DAR shall forfeit the bond in favor of the Agrarian Reform Fund when it finds the applicant carrying out any premature conversion activity; and 24.2.3. The validity of the bond shall be for a period of one (1) year, renewable by not more than one (1) year when necessary. 24.3. The DAR shall forfeit the bond in favor of the Agrarian Reform Fund when the applicant, or any person acting in his behalf, carries out any actual conversion activity on the land prior to the application's approval. Forfeiture shall be without prejudice to the filing of criminal charges against those responsible for premature conversion. 24.4. After faithful compliance with the terms and conditions of the bond, the applicant may opt to refund or convert the same into a performance bond after issuance of the Conversion Order. 24.5. The following projects shall be exempt from posting a "bond to guarantee against premature conversion": 24.5.1. Socialized housing projects as certified by the HLURB;

24.5.2. Resettlement projects for families displaced by development of government projects as certified by the National Housing Authority (NHA); and 24.5.3. Community Mortgage Program (CMP) projects as certified by the National Home Mortgage Finance Corporation (NHMFC). When the application involves a mixed use of socialized and non-socialized housing projects, the application shall not enjoy any bond exemption for socialized housing unless at least eighty (80) percent of the land applied for conversion shall be used directly and exclusively for socialized housing. SECTION 25. Convertibility of Bond. An applicant who posted a "bond to guarantee against premature conversion" using a GSIS surety bond may thereafter opt to convert said surety bond into a performance bond after securing the consent of the GSIS, in line with Article 2079 of the Civil Code. SECTION 26. Performance Bond. Within five (5) days from receipt of a copy of the Conversion Order, the applicant shall post a performance bond in the form of either of the following: 26.1. Cash or manager's/cashier's check equivalent to at least two point five percent (2.5%) of the total zonal value of the land per latest issuance of the Department of Finance; or 26.2. GSIS surety bond equivalent to at least fifteen percent (15%) of the total zonal value of the land per latest issuance of the Department of Finance, indicating the following conditions at the minimum that: 26.2.1. 26.2.2. The bond is callable on demand; A photocopy of the approved Conversion Order is attached and forms part of the bond;

26.2.3. The DAR shall forfeit the bond in favor of the Agrarian Reform Fund when it finds the applicant in default of his obligation to complete development of the land and/or comply with any of the conditions in the Conversion Order; and 26.2.4. The validity of the bond shall be equivalent to the prescribed period of development of the area under the Conversion Order. SECTION 27. Reimbursement for Government Investment. Pursuant to DA-AO-6-1998, in case of approved conversion of land within SAFDZ, the registered owner shall pay the government, through the Treasurer of the Philippines, the amount equivalent to the government's investment cost, including inflation, estimated to include all expenditures for capital goods expended by any and all agencies, financed from public, national or local budget resources, whether sourced from domestic or foreign, on the land applied for land use conversion, provided, that: 27.1. The valuation of such investments will be equivalent to the total government expenditure made on the land in question, adjusted for average inflation over the period starting from the beginning of investment up to the month of approval of conversion;

27.2. The valuation shall be determined jointly by the Municipal Assessor and Municipal Treasurer, in consultation with those agencies which have made public investments in the area; and 27.3. The payment of the landowner shall be made in a single, lump sum payment to the Treasurer of thePhilippines through the Municipal Treasurer of the Municipality where the farmland concerned is located. SECTION 28. Disturbance Compensation. 28.1. The applicant and/or landowner and/or developer shall pay disturbance compensation in cash or kind or combination of cash and kind to the farmers, agricultural lessees, share tenants, farmworkers, actual tillers, and/or occupants affected by the conversion, in such amounts or under such terms as the parties may mutually agree upon. 28.2. The amount of disturbance compensation shall not be less than five (5) times the average of the gross harvests on the target landholding during the last five (5) preceding calendar years, pursuant to Section 36 of RA 3844, as amended by Section 7 of RA 6389. 28.3. Compensation in kind may consist of some or all or mixture of housing, homelots, employment, and/or other benefits. The DAR shall approve the terms of any agreement for the payment of disturbance compensation and monitor compliance therewith. In no case shall compliance with the terms and conditions thereof extend beyond sixty (60) days from the date of approval of the application for conversion. 28.4. If the parties fail to agree on the amount of disturbance compensation, or raise an issue questioning the lease or tenancy relationship or any other prejudicial issue that tends to justify non-payment of disturbance compensation, either or both parties may refer the issue to the Provincial Agrarian Reform Adjudicator (PARAD) for resolution. While the case is pending before the Adjudicating Authority, the landowner(s)/applicant(s) may not evict said farmers, agricultural lessees, share tenants, farmworkers, actual tillers, or occupants, until such time when the Adjudicating Authority resolves the prejudicial issue(s) with finality. 28.5. The applicant shall furnish the RCLUPPI/CLUPPI with proof of payment of disturbance compensation within five (5) days from receipt of payment. ARTICLE IV Conversion to Homelot SECTION 29. Criteria. Conversion to a homelot is allowable when: the applicant owns the lot that he proposes to convert; he intends to establish a dwelling place for himself on said lot; the lot has an area not exceeding five hundred (500) square meters; and the conversion shall be from agricultural to purely residential use. SECTION 30. Documentary Requirements. 30.1. Official receipt showing proof of payment of filing fee and inspection cost; 30.2. Duly accomplished application for conversion subscribed and sworn to before a notary public or any person authorized to administer oaths; 30.3. True copy of the Original Certificate of Title (OCT) or Transfer Certificate of Title (TCT) of the subject land, certified by the Register of Deeds not earlier than thirty (30) days prior to application filing date. In case of untitled land, the following shall be required in lieu of a title: 30.3.1. Certification from the DENR Community Environment and Natural Resources Officer (CENRO) that the landholding has been classified as alienable and disposable; and 30.3.2. Certification from the DENR CENRO (for administrative confirmation of imperfect title) or the Clerk of Court (for judicial confirmation of imperfect title) that the titling process/proceedings has commenced and there are no adverse claimants; 30.4. True copy of the Certificate of Title of the subject land as of 15 June 1988, and all successor Titles until the present Title referred to in Section 10.4 hereof, if applicable. 30.5. Directional sketch map to guide the ocular inspection team in locating the homelot. SECTION 31. Procedure. 31.1. The applicant shall first secure an Application Form from the RCLUPPI. 31.2. Following the instructions that accompany the Application Form, the applicant shall fill up the same with all the necessary data, and thereafter, reproduce at least three (3) clear photocopies of the accomplished Application Form which he shall place in three (3) separate folders (plus a fourth folder for the original set), the distribution of which shall be as follows:

31.2.1. The original copy for the RCLUPPI (the receiving clerk must rubberstamp the words "ORIGINAL" on the original copy); 31.2.2. 31.2.3. 31.2.4. One (1) photocopy for the RCLUPPI; One (1) photocopy for the PARO; and One (1) photocopy for the MARO.

31.3. The RCLUPPI shall then review the completeness of the application folders. If found complete, the applicant shall pay a filing fee amounting to Five Hundred Pesos (P500) and the inspection cost amounting to One Thousand Pesos (P1,000). Acceptance date of the application folders shall be the "Filing Date" of the application. 31.4. Within five (5) days from Filing Date, the RCLUPPI shall transmit two (2) of the above folders, containing photocopies, to the PARO and MARO, respectively. 31.5. Within thirty (30) days from receipt of the folder, the MARO shall: check the status of CARP coverage on the subject landholding, post notices of the application in a conspicuous place in the municipality and a conspicuous place in the barangay covering the subject landholding; and submit a report thereon to the PARO. 31.6. Within thirty (30) days from receipt of the MARO report, the PARO shall issue to the applicant a Notice of Conduct of Ocular Inspection indicating the date thereof. The ocular inspection shall be held not earlier than fifteen (15) days nor later than thirty (30) days from issuance date of the Notice of Conduct of Ocular Inspection. 31.7. The PARO and MARO or their representatives shall conduct ocular inspection in the presence of the applicant and oppositor(s), if any. 31.8. Within thirty (30) days from conduct of ocular inspection, the PARO shall submit a report and forward the records to the RCLUPPI. 31.9. The RCLUPPI shall deliberate on the merits of the application and may call the applicant and/or oppositor(s), if any, for clarificatory questioning, to judiciously resolve any dispute arising from the application. 31.10. Within thirty (30) days from receipt of the PARO report, the RCLUPPI shall submit its recommendation to the Regional Director. 31.11. Within thirty (30) days from receipt of the RCLUPPI recommendation, the Regional Director shall promulgate his decision on whether to grant or deny conversion. 31.12. The filing of a protest shall interrupt the running of any of the foregoing deadline periods. The RCLUPPI shall thereupon proceed to hear the protest and thereafter submit its recommendation to the Regional Director who shall resolve the protest simultaneously with the application. ARTICLE V Issuance of Conversion Order and its Effects SECTION 32. Issuance of Order. No Conversion Order (or its denial) shall be valid without the following information: 32.1. Conversion case number. 32.2. OCT/TCT numbers and corresponding lot numbers. In case of untitled lands, the lot numbers and corresponding survey plan numbers. 32.3. Names of all registered landowners for each parcel of land. 32.4. Name of applicant or representative, if the applicant is not the landowner. 32.5. Name of developer. 32.6. Proposed use of the land. 32.7. Total area applied for conversion. 32.8. Total area approved or disapproved for conversion; and 32.9. Date of approval or denial of the order. SECTION 33. Conditions of Conversion Order. The approval of the application for conversion shall be subject to the following conditions: 33.1. The applicant shall not undertake any development until all the applicable permits and clearances from the other concerned government agencies have been granted.

33.2. Within fifteen (15) days from receipt of the Conversion Order, the landowner shall post a performance bond in accordance with Sections 25 or 26 hereof. 33.3. Within thirty (30) days from receipt of the Conversion Order, the landowner shall request the Register of Deeds to annotate on the property's title the land use allowed under the Conversion Order. 33.4. Within sixty (60) days from receipt of the Conversion Order, the landowner shall return to the CLUPPI or RCLUPPI a certified true copy of the title that already contains the annotation indicating the land use allowed under the Conversion Order. 33.5. Within sixty (60) days from receipt of the Conversion Order, the landowner, solidarity with his co-owner(s) and developer(s), shall pay disturbance compensation to the affected farmers, agricultural lessees, share tenants, farmworkers, actual tillers, or occupants, in such amounts or kinds as the parties may mutually agree upon, subject to the approval of the DAR. 33.6. Within one (1) year from issuance of the Conversion Order, the landowner and/or developer shall commence development on the property approved for conversion, and shall complete development not later than the deadline(s) set forth in its site development plan schedule, but in no case shall development extend beyond five (5) years from issuance of the Conversion Order. 33.7. For housing projects, the landowner shall secure an ECC, if applicable, prior to undertaking any development therein. 33.8. The landowner and his representatives shall allow DAR officials free and unhampered access into the property approved for conversion for the purpose of monitoring compliance with the terms and conditions thereof. 33.9. The landowner and future landowner(s) of the property approved for conversion shall not change its use to another use not authorized under the Conversion Order without prior consent from the DAR. This prohibition extends to changes in housing standards, changes in selling schemes, changes from social housing to open market housing or vice-versa, and all other similar changes. 33.10. The landowner and/or developer shall submit quarterly reports on the status of development to the MARO, PARO, and DAR Regional Office covering the subject property. 33.11. The grant of a Conversion Order alone shall not be a ground for eviction. Any person who desires to evict occupants on the basis of the Conversion Order shall invoke other meritorious grounds and file the proper action. 33.12. The DAR reserves the right to revoke the Conversion Order upon valid grounds and after proper investigation. SECTION 34. Effects of approval of conversion The approval of an application for conversion shall have, but shall not be limited to, the following effects: 34.1. It shall be limited to the specific use of the land authorized in the Conversion Order; 34.2. It shall be subject to the schedule indicated in the detailed site development, work and financial plans, but in no case shall the period of development extend beyond five (5) years from issuance of the Conversion Order except as authorized by the Secretary or the approving official on meritorious grounds, provided that, if the development cannot be accomplished within five (5) years, the grantee of the Conversion Order shall submit a written request for extension within the six (6) months before the lapse of the five (5)-year period, and provided further, that the extended development period shall be one (1) year for every five (5) hectares, but in no case shall the extension exceed five (5) years. 34.3. The conditions thereof shall be binding upon successors-in-interest of the property; HTacDS 34.4. The applicant shall allow duly authorized representatives of DAR free and unhampered access to the property subject of the Conversion Order to monitor compliance with the terms and conditions thereof; 34.5. The use authorized in the Conversion Order shall be annotated on the title of the subject property; and 34.6. It shall be without prejudice to the ancestral domain claims of indigenous peoples, if any, pursuant toRA 8371 or the "Indigenous Peoples Rights Act". SECTION 35. Distribution of copy of Conversion Order. 35.1. For monitoring purposes, the RCLUPPI shall furnish the CLUPPI with copies of all Conversion Orders issued at the regional level. 35.2. The RCLUPPI/CLUPPI shall be responsible and liable for giving a copy of the Conversion Order (or its denial) to all parties listed in the Conversion Order.

35.3. The Registry of Deeds of the locality wherein the area applied for conversion is located, among others, shall be given a copy of the Conversion Order. The applicant, upon filing of the application for conversion, shall give the complete address of the local Registry of Deeds to the RCLUPPI/CLUPPI Secretariat. 35.4. The DENR's Environmental Management Bureau (EMB), and all other concerned agencies and parties, shall be given a copy of the Conversion Order or its denial. ARTICLE VI Motion for Reconsideration SECTION 36. Motion for Reconsideration A party may file only one (1) motion for reconsideration of the decision, resolution, or final order of the Regional Director or Secretary, and may do so only within a non-extendible period of fifteen (15) calendar days from receipt of the challenged decision, resolution, or final order. The pendency of a timely motion for reconsideration by the proper party shall stay execution of the challenged decision, resolution, or final order. 36.1. At the Regional Director's level, if the motion for reconsideration is denied, the movant may perfect an appeal before the Secretary within only the remainder of said non-extendible period of fifteen (15) calendar days. If the motion for reconsideration is granted, resulting to the reversal of the original decision, the aggrieved party may perfect an appeal before the Secretary within a full but non-extendible period of fifteen (15) calendar days from receipt of the reversed resolution. 36.2. At the Office of the Secretary's level, if the motion for reconsideration is denied, the movant may perfect an appeal before the Office of the President (OP) within fifteen (15) calendar days from receipt of the resolution denying the motion for reconsideration. ARTICLE VII Appeals SECTION 37. Who May Appeal. Only the aggrieved party or parties who is/are either the applicant(s) or protestor(s)/oppositor(s), or both, or their successor(s)-in-interest, may appeal the decision, resolution, or final order of the Regional Director or Secretary within the periods prescribed in Section 33 hereof. The appellant(s) shall furnish copies of the appeal pleadings to all parties and to the RCLUPPI, Regional Director, CLUPPI, and Secretary. SECTION 38. When to Appeal. The appellant(s) may perfect his/their appeal within a non-extendible period of fifteen (15) calendar days from receipt of the decision, resolution, or final order of the approving authority. The moment the DAR loses jurisdiction over a case by reason of an appeal to the OP, the applicable rules of the OP shall then govern the appeal. SECTION 39. Where to File an Appeal. 39.1. Appeal from the decision, resolution, or final order of the Regional Director to the Secretary shall be made by filing a Notice of Appeal before the Office of the Regional Director of origin, furnishing copies thereof to all adverse parties, if any, together with payment of the requisite appeal fees to the cashier of the regional office of origin. 39.2. Appeal from the decision, resolution, or final order of the Secretary shall be made by filing a Notice of Appeal before either the Office of the Bureau of Agrarian Legal Assistance (BALA) Director, or directly at the OP, furnishing copies thereof to all adverse parties, if any, together with payment of the requisite appeal fees to the cashier of either the DAR or OP. 39.3. Appeal from the decision, resolution, or final order of the Secretary may be taken to the Court of Appeals by certiorari in accordance with Section 54 of RA 6657. SECTION 40. Appeal by a Pauper Litigant. A party opposing an application for conversion, who is a farmer, agricultural lessee, share tenant, farmworker, actual tiller, occupant, member of a farmers' collective or cooperative, or any other person directly working on the land may allege that he is a pauper litigant without need for further proof. He shall enjoy pauper litigant privileges such as exemption from payment of appeal fees. SECTION 41. Appeal Pleadings. For appeals from the Regional Director to the Secretary, the appellant shall submit an appeal brief with the BALA within fifteen (15) days from perfection of the appeal, furnishing a copy thereof to all parties and to the RCLUPPI, Regional Director and CLUPPI. The appellee may submit a comment (not motion to dismiss) within ten (10) days from receipt of the appeal brief, furnishing a copy thereof to the appellant and to the RCLUPPI, Regional Director and CLUPPI. Within fifteen (15) days from filing of appellee's comment, the BALA shall issue a preliminary order stating either that:

41.1. The pleadings on record need further clarification and the conduct of a clarificatory hearing is necessary. Ten (10) days after the termination thereof, the parties may be ordered to simultaneously file their respective appeal memorandum. 41.2. The pleadings on record are insufficient for a proper determination of the issues raised and so the parties shall simultaneously file their respective appeal memorandum within ten (10) days from receipt of order for simultaneous filing. 41.3. The pleadings on record are sufficient for deciding the appeal and henceforth the deciding authority shall promulgate its decision. Upon submission of sufficient pleadings, the BALA Director shall submit his recommendation to the deciding authority. SECTION 42. Perfection of Appeal. 42.1. The filing of a proper notice of appeal and payment of requisite appeal fees in due time perfects the appeal with respect to the subject matter thereof. 42.2. The office that rendered the challenged decision, resolution, or final order loses jurisdiction over the case after perfection of the appeal and expiration of the period to appeal by all other parties. SECTION 43. DAR Representation on Appeal. 43.1. The Secretary shall represent the DAR in all appeals to the OP. 43.2. The Office of the Solicitor General (OSG) shall represent the DAR in all appeals to the Court of Appeals. Alternatively, the OSG may deputize any DAR lawyer to represent the DAR in said appeals. SECTION 44. Execution Pending Appeal. 44.1. Appeal from the Regional Director The appeal shall stay execution of the decision, resolution, or final order of the Regional Director unless the Secretary directs execution pending appeal when the exceptional nature and circumstances of the case so requires (EO 292-1987, Book VII, Chapter 4, Section 21). 44.2. Appeal to the OP The appeal shall stay execution of the decision, resolution, or final order of the Secretary unless the OP directs execution pending appeal upon such terms and conditions as it may deem just and reasonable (OP-AO-18-1987 Section 4). SECTION 45. Finality of Conversion Order. The Conversion Order or its denial shall become final and executory after all parties were able to receive a copy of the Order, and after the lapse of fifteen (15) calendar days from receipt by the party who last receives a copy of the Order, and no motion for reconsideration or appeal has been filed. The Head of the Legal Division of the Regional Office or the BALA Director, as the case may be, shall issue the appropriate Certificate of Finality. ARTICLE VIII Revocation or Withdrawal of Conversion Orders SECTION 46. Filing of Petition. Any person may file a petition to revoke, and the landowner may file a petition to withdraw, the Conversion Order before the approving authority within ninety (90) days from discovery of facts warranting revocation or withdrawal, but not more than one (1) year from issuance of the Conversion Order. When the petition alleges any of the grounds in the enumeration in the next section, the filing period shall be within ninety (90) days from discovery of such facts but not beyond the development period stipulated in the Conversion Order. Within the DAR, only the Secretary may resolve petitions that question the jurisdiction of the recommending body or approving authority. SECTION 47. Grounds. The following acts or omissions shall warrant revocation of the Conversion Order: 47.1. Lack of jurisdiction of the approving authority; 47.2. Misrepresentation or concealment of facts material to the grant of conversion; 47.3. Non-compliance with the conditions of the Conversion Order; 47.4. Non-compliance with the agreement on disturbance compensation payment; 47.5. Conversion to a use other than that authorized in the Conversion Order, or 47.6. Any other serious violation of agrarian laws. SECTION 48. General Procedure. 48.1. Upon receipt of the petition, the approving authority shall order the respondent(s) to file a comment within fifteen (15) days from receipt of said order.

48.2. The proceedings shall be non-litigious in nature. Except for basic essential requirements of due process, the approving authority shall refrain from strict application of procedural technicalities and rules governing admissibility and sufficiency of evidence obtaining in judicial courts. 48.3. The approving authority shall undertake reasonable means to ascertain the facts of the controversy, including a thorough examination of witnesses, and, ocular inspection of the premises in question, as may be necessary. 48.4. The approving authority shall render a decision on the merits of the case within thirty (30) days from the time the case is deemed submitted for resolution., SECTION 49. Effect of Revocation or Withdrawal of Conversion Order . The land subject thereof shall revert to the status of agricultural lands and shall be subject to CARP coverage as circumstances may warrant. ARTICLE IX Monitoring of Land Use Conversion SECTION 50. Responsibility for Monitoring Illegal Conversion . The Provincial/City Task Forces on Illegal Conversion, created pursuant to DAR-DOJ Joint AO 5-1994, shall monitor cases of illegal conversion of agricultural lands in the provinces or cities, as the case may be. The PARO shall submit quarterly reports on illegal conversion to the National Task Force on Illegal Conversion at the DAR Central Office. SECTION 51. Compliance Monitoring. Compliance with the terms and conditions of the Conversion Order shall be monitored, as follows: 51.1. The landowner or developer shall submit quarterly reports on the status of the development to the RCLUPPI and the PARO with jurisdiction over the property. 51.2. The RCLUPPI shall turn over reports to the designated office in the Regional Office which shall monitor compliance by the applicant/developer with the terms and conditions of the conversion, including the posting of the approved order. It shall submit quarterly reports to the CLUPPI regarding the status of land use conversions, copy furnished the DAR Provincial and Municipal Offices concerned. 51.3. The CLUPPI shall evaluate and consolidate the reports submitted by the Regional Office, and render quarterly reports on the status of the land use conversion applications to the Secretary, through the Undersecretary for Field Operations and Support Services, copy furnished the National Task Force on Illegal Conversion. 51.4. The BARC and representative of Non-Government Organizations/People's Organizations (NGO/PO) may be authorized by the DAR Secretary or Regional Director to assist in monitoring compliance with the terms and conditions of the Conversion Order, as may be necessary. ARTICLE X Investigation and Prosecution SECTION 52. Prohibited Acts and Omissions. The following acts or omissions are prohibited: 52.1. The conversion by any landowner of his agricultural land into any non-agricultural use with intent to avoid the application of the CARP on his landholdings and to dispossess his tenant farmers of the land tilled by them, as provided for under Section 73 (c) of RA 6657; 52.2. The change of the nature of lands outside urban centers and city limits, either in whole or in part, after the effectivity of RA 6657, as provided in Section 73 (e) thereof; 52.3. Premature conversion as defined under Section 4 of RA 8435 and Section 2 hereof, or the undertaking of any development activity, the results of which modify or alter the physical characteristics of the agricultural lands to render them suitable for non-agricultural purposes without an approved Conversion Order from the DAR; 52.4. Unauthorized conversion or changing the current use of the land from agricultural (e.g. rice land) to another agricultural use, the effect of which is to exempt the land from CARP coverage (e.g. livestock, poultry, aquaculture) without a Conversion Order from the DAR, or changing the use of the land to one other than that allowed under the Conversion Order issued by the DAR as defined under Section 2 hereof. SECTION 53. Who May be Held Liable. 53.1. Any landowner or developer, who commits any act which constitutes illegal, premature or unauthorized conversion, including, their accomplices and accessories, if any, shall be investigated pursuant to these Rules. 53.2. If the offender is a corporation or an association, the officer responsible therefor shall be held liable. SECTION 54. Investigating Officials.

54.1. The DAR Officials, who are designated members of the Provincial/City Task Forces on Illegal Conversion pursuant to DAR-DOJ Joint AO-5-1994, shall be primarily responsible for the investigation, gathering of evidence, and the filing of the complaints against illegal, premature or unauthorized conversions within their respective areas of jurisdiction. 54.2. The Secretary may, however, direct such other officials as may be appropriate to investigate cases of illegal, premature, or unauthorized conversion. He may constitute a team composed of national and/or local DAR officials, representatives from other law enforcement agencies, and volunteers from NGOs/POs for this purpose. 54.3. The Secretary or his duly authorized representative shall be furnished copies of the investigation reports and other relevant documents for appropriate action. SECTION 55. Duties of Provincial/City Task Forces on Illegal Conversion. In accordance with DAR-DOJ Joint AO-5-1994, the Provincial/City Task Forces on Illegal Conversion shall perform the following duties and responsibilities: 55.1. DAR Members: 55.1.1. Conduct actual ocular inspection and case build-up;

55.1.2. File the necessary complaint/affidavit together with supporting documents before the task force member prosecutor; 55.1.3. 55.1.4. Investigate all ongoing development project and conversion of agricultural land; Monitor the conversion situation in the province and cities within the province;

55.1.5. Report to the National Task Force on the conversion situation in the province and cities within the province; and 55.1.6. Perform such other related functions, which may be assigned by the National Task Force on Illegal Conversion. 55.2. DOJ Prosecutor Members: 55.2.1. Conduct inquest or preliminary investigation, as the case may be;

55.2.2. Recommend and file criminal cases against the landowners and developers involved in illegal conversion of agricultural lands under RA 6657; 55.2.3. Submit to the National Task Force a monthly progress/status report of all cases involving illegal conversion of agricultural lands; and 55.2.4. Perform such other related functions, which may be assigned by the National Task Force on Illegal Conversion. SECTION 56. Evidentiary Requirements. In illegal, premature or unauthorized conversions, the investigating officials mentioned in Section 51 hereof shall be responsible for securing the evidence necessary to support the charges. SECTION 57. Administrative Action. The following procedure shall be followed in the administrative investigation of illegal, premature, or unauthorized conversions: 57.1. On the basis of the complaint or report received, the Secretary or his duly authorized representative shall conduct an investigation to determine if a prima facie case of illegal, premature, or unauthorized conversion exists. 57.2. Upon determination of the prima facie case, the Secretary, or Regional Director (for those cases where he was the approving authority), shall issue a cease and desist order (CDO) directing the respondent to stop any and all development activities in the area and requiring him to explain within ten (10) days from receipt of the CDO why he should not be penalized for violation of existing laws, rules and regulations on land use conversion. 57.3. After the lapse of the period to answer, whether or not an answer has been filed, administrative proceedings shall be conducted to determine if the respondent can be held liable for illegal, premature, or unauthorized conversion. The proceedings shall not be bound by the technical rules of procedure and evidence, but shall proceed in a most expeditious manner, employing all reasonable means to ascertain the facts of every case in accordance with justice and equity and the merits of the case. The investigating official shall have the power to summon witnesses, administer oaths, take testimony, require submission of reports, compel the production of books and documents and answers to interrogatories and issue subpoenaad testificandum and subpoena duces tecum and to enforce its writs through sheriffs or other duly deputized officers. He shall likewise have the power to punish for direct and indirect contempt in the same manner and subject to the same penalties as provided in the Rules of Court, in accordance with Section 50 of RA 6657.

57.4. Upon determination that the respondent committed illegal, premature, or unauthorized conversion, the cash bond or performance bond, if any, shall be cancelled and forfeited in favor of the government, without prejudice to the imposition of other penalties or sanctions, as may be warranted. 57.5. Any government official who, directly or indirectly, assisted or took part in the commission of illegal, premature or unauthorized conversion shall be administratively charged or dealt with in accordance with pertinent laws and regulations. SECTION 58. Institution of Criminal Action. 58.1. The DAR members of Provincial/City Task forces on Illegal Conversion shall be primarily responsible for filing complaints of illegal or premature conversion pursuant to RA 6657 or RA 8435before the Office of the Provincial or City Prosecutor. However, the Secretary or the National Task Force on Illegal Conversion may directly institute such criminal action in flashpoint cases or those, which, in his judgment, would require immediate action to protect public interest. 58.2. The DOJ prosecutor-members of the Provincial/City Task Forces on Illegal Conversion shall conduct inquest or preliminary investigation, as the case maybe, and recommend the filing of criminal cases in court against the landowners, developers, and all those responsible for illegal or premature conversion, as the evidence may warrant. 58.3. However, unauthorized conversions as defined herein shall not warrant criminal prosecution but only administrative sanctions, as may be appropriate. SECTION 59. Prosecution of Illegal Conversion Cases. The prosecution of illegal conversion cases shall be the primary responsibility of the designated provincial/city prosecutors, with active support from the concerned DAR Officials. SECTION 60. Role of National Task Force on Illegal Conversion . Pursuant to DAR-DOJ Joint AO-4-1993, the National Task Force on Illegal Conversion shall perform the following duties and responsibilities: 60.1. Identify and set priority areas or provinces where illegal conversion of agricultural lands are rampant; 60.2. Report to the Secretaries of the DAR and the DOJ on the conversion situation in the country; 60.3. Recommend the issuance and/or amendment of guidelines and circulars on conversion and/or illegal conversion of agricultural lands; 60.4. Designate such persons who will coordinate and monitor the activities of the Provincial Task Forces on Illegal Conversion; and 60.5. Perform such other related functions as may be assigned by the Secretary of the Department of Agrarian Reform and the Secretary of the Department of Justice. ARTICLE XI Penalties and Sanctions SECTION 61. Administrative Sanctions. The DAR may impose any or all of the following sanctions after determining, in an appropriate administrative proceeding, that a violation of these Rules has been committed: 61.1. Revocation or withdrawal of the authorization for land use conversion; 61.2. Blacklisting of the applicant, developer or representative; 61.3. Automatic disapproval of pending and subsequent conversion applications that the offender may file with the DAR; 61.4. Issuance of cease and desist order by the Secretary or Regional Director, as the case may be, upon verified reports that premature, illegal or unauthorized conversion activities are being undertaken; or 61.5. Forfeiture of cash bond or performance bond. SECTION 62. Administrative Sanctions against DAR officials or employees . The DAR may impose against its own officials or employees the following sanctions, in accordance with the Uniform Rules on Administrative Cases in the Civil Service [effective 26 September 1999], specifically Rule IV, Section 52, sub-section "C", numbers "13" to "15", to wit: 62.1. Failure to act promptly on letters and request within fifteen (15) days from receipt, except as otherwise provided in the rules implementing the Code of Conduct and Ethical Standards of Public Officials and Employees: 1st Offense Reprimand; 2nd Offense Suspension 1 to 30 days;

3rd Offense Dismissal. 62.2. Failure to process documents and complete action on document and papers within a reasonable time from preparation thereof, except as otherwise provided in the rules implementing the Code of Conduct and Ethical Standards of Public Officials and Employees: 1st Offense Reprimand; 2nd Offense Suspension 1 to 30 days; 3rd Offense Dismissal. 62.3. Failure to attend to anyone who wants to avail himself of the services of the office, or act promptly and expeditiously on public transactions: 1st Offense Reprimand; 2nd Offense Suspension 1 to 30 days; 3rd Offense Dismissal. SECTION 63. Criminal Penalties. 63.1. Pursuant to Section 73 (c), (e) and 74 of RA 6657, any person who knowingly or willfully converts agricultural lands into any non-agricultural use with intent to avoid the application of said Act and to dispossess his tenant farmers of the land tilled by them; or who changes the nature of the land outside urban centers and city limits in whole or in part after the effectivity of RA 6657 shall be punished by imprisonment of not less than one (1) month to not more than three (3) years or a fine of not less than fifteen thousand (P15,000.00) pesos, or both, at the discretion of the court. 63.2. Any person found guilty of premature or illegal conversion under RA 8435 shall be penalized, in accordance with Section 11 thereof, with imprisonment of two (2) to six (6) years, or a fine equivalent to one hundred percent (100%) of the government's investment cost, or both, at the discretion of the court, and an accessory penalty of forfeiture of the land and any improvement thereon. ARTICLE XII Transitory and Final Provisions SECTION 64. Effect of Pending Applications. This Administrative Order shall apply prospectively to all applications for land use conversion. Existing rules shall govern all pending applications for land use conversion. Grantees of previous conversion orders who were not yet able to complete development of properties approved for conversion may request for extension of the development period by first posting a new performance bond in accordance with Sections 23 to 26 of this Administrative Order. SECTION 65. Repealing Clause. This Administrative Order amends or repeals all other DAR issuances inconsistent herewith. SECTION 66. Separability Clause. Any judicial pronouncement declaring as unconstitutional any provision or portion of this Administrative Order shall not affect the validity of the other provisions herein. SECTION 67. Effectivity. This Administrative Order shall take effect ten (10) days after complete publication in at least two (2) newspapers with nationwide circulation. Diliman, Quezon City, 28 February 2002.

CASES:
G.R. No. 132477; August 31, 2005 JOSE LUIS ROS, ANDONI F. ABOITIZ, XAVIER ABOITIZ, ROBERTO E. ABOITIZ, ENRIQUE ABOITIZ, MATTHIAS G. MENDEZONA, CEBU INDUSTRIAL PARK DEVELOPERS, INC. and FBM ABOITIZ MARINE, INC., Petitioners, vs. DEPARTMENT OF AGRARIAN REFORM, HON. ERNESTO GARILAO, in his capacity as DAR Secretary, and DIR. JOSE LLAMES, in his capacity as Director of DAR-Regional 7, Respondent. DECISION CHICO-NAZARIO, J.: Petitioners are the owners/developers of several parcels of land located in Arpili, Balamban, Cebu. By virtue of Municipal Ordinance No. 101 passed by the Municipal Council of Balamban, Cebu, these lands were reclassified as industrial 1 lands. On 03 April 1995, the Provincial Board of Cebu approved Balambans land use plan and adopted en

toto Balambans Municipal Ordinance No. 101 with the passage of Resolution No. 836-95 and Provincial Ordinance No. 2 95-8, respectively. As part of their preparation for the development of the subject lands as an industrial park, petitioners 3 secured all the necessary permits and appropriate government certifications. Despite these permits and certifications, petitioner Matthias Mendezona received a letter from Mr. Jose Llames, Director of the Department of Agrarian Reform (DAR) Regional Office for Region 7, informing him that the DAR was disallowing the conversion of the subject lands for industrial use and directed him to cease and desist from further developments on 4 the land to avoid the incurrence of civil and criminal liabilities. Petitioners were thus constrained to file with the Regional Trial Court (RTC) of Toledo City a Complaint dated 29 July 1996 for Injunction with Application for Temporary Restraining Order and a Writ of Preliminary Injunction, docketed as 5 6 Civil Case No. T-590. In an order dated 12 August 1996, the RTC, ruling that it is the DAR which has jurisdiction, 7 dismissed the Complaint for lack of jurisdiction. It justified the dismissal in this wise: A perusal of Section 20 of the Local Government Code expressly provides that the Municipalities through an Ordinance by the Sanggunian may authorize the reclassification of the agricultural land within their area into non-agricultural. Paragraph (e) of the aforesaid Section, provides further: that nothing in this Section shall be construed as repealing or modifying in any manner the provision of Republic Act 6657. In an opinion of the Secretary of Justice, quoted: With respect of (sic) conversion of agricultural land to non-agricultural uses the authority of the DAR to approve the same may be exercise (sic) only from the date of the effectivity of the Agrarian Reform Law on June 15, 1988. It appears that the petitioners had applied for conversion on June 13, 1995 and therefore the petitioner (sic) are estopped from questioning the authority and jurisdiction of the Department of Agrarian Reform. The application having been filed after June 15, 1988, the reclassification by the Municipal Council of Balamban was just a step in the conversion of the aforestated lands according to its purpose. Executive Order No. 129-A, Section 5, "The Department shall be responsible for implementing Comprehensive Agrarian Reform and for such purpose it is authorized to (J) approve or disapprove the conversion, restructuring or readjustment of agricultural land into non-agricultural uses." Said Executive Order amended Section 36 of Republic Act No. 3644 which clearly mandates that the DAR Secretary (sic) approve or disapprove conversion are not impliedly repealed. In fact, under Section 75 of Republic Act 6657 the above laws and other laws not inconsistent of (sic) this act shall have suppletory effect. Further, Section 68 of Republic Act 6657 provides: No injunction, restraining order, prohibition or mandamus shall be issued by the lower court against the Department of Agrarian Reform, DENR and Department of Justice in their implementation of the program. With this provision, it is therefore clear (sic) when there is conflict of laws determining whether the Department of Agrarian Reform has been exclusively empowered by law to approve land conversion after June 15, 1988 and (sic) the final ruling falls only with the Supreme Court or Office of the President. WHEREFORE, in view of the foregoing, the Application for Restraining Order is hereby ordered DENIED and the main 8 case is DISMISSED, this Court having no jurisdiction over the same. In an order dated 18 September 1996, the trial court denied the motion for reconsideration filed by the 9 petitioners. Petitioners filed before this Court a Petition for Review on Certiorari with application for Temporary 10 11 Restraining Order and Writ of Preliminary Injunction. In a resolution dated 11 November 1996, this Court referred the 12 petition to the Court of Appeals. Petitioners moved for a reconsideration of the said resolution but the same was denied 13 in a resolution dated 27 January 1997. At the Court of Appeals, the public respondents were ordered to file their Comments on the petition. Two sets of 15 comments from the public respondents, one from the Department of Agrarian Reform Provincial Office and another from 16 17 the Office of the Solicitor General, were submitted, to which petitioners filed their Consolidated Reply. On 02 December 1997, the Court of Appeals rendered a decision affirming the Order of Dismissal issued by the 19 20 RTC. A motion for reconsideration filed by the petitioners was denied in a resolution dated 30 January 1998. Hence, this petition. The following issues
21 18 14

are raised by the petitioners for resolution:

(a) Whether or not the reclassification of the subject lands to industrial use by the Municipality of Balamban, Cebu pursuant to its authority under Section 20(a) of Republic Act No. 7160 or the Local Government Code of 1991 (the "LGC") has the effect of taking such lands out of the coverage of the CARL and beyond the jurisdiction of the DAR; (b) Whether or not the Complaint for Injunction may be dismissed under the doctrine of primary jurisdiction; (c) Whether or not the Complaint for Injunction is an appropriate remedy against the order of the DAR enjoining development works on the subject lands; (d) Whether or not the Regional Trial Court of Toledo City had authority to issue a writ of injunction against the DAR. In sum, petitioners are of the view that local governments have the power to reclassify portions of their agricultural lands, 2223 subject to the conditions set forth in Section 20 of the Local Government Code. According to them, if the agricultural land sought to be reclassified by the local government is one which has already been brought under the coverage of the

Comprehensive Agrarian Reform Law (CARL) and/or which has been distributed to agrarian reform beneficiaries, then such reclassification must be confirmed by the DAR pursuant to its authority under Section 6522 of the CARL, in order for the reclassification to become effective. If, however, the land sought to be reclassified is not covered by the CARL and not distributed to agrarian reform beneficiaries, then no confirmation from the DAR is necessary in order for the reclassification to become effective as such case would not fall within the DARs conversion authority. Stated otherwise, Section 65 of the CARL does not, in all cases, grant the DAR absolute, sweeping and all-encompassing power to approve or disapprove reclassifications or conversions of all agricultural lands. Said section only grants the DAR exclusive authority to approve or disapprove conversions of agricultural lands which have already been brought under the coverage of the CARL and which have already been distributed to farmer beneficiaries. The petition lacks merit. After the passage of Republic Act No. 6657, otherwise known as Comprehensive Agrarian Reform Program, agricultural lands, though reclassified, have to go through the process of conversion, jurisdiction over which is vested in the DAR. However, agricultural lands already reclassified before the effectivity of Rep. Act No. 6657 are exempted from conversion. Department of Justice Opinion No. 44, Series of 1990, provides: ". . . True, the DARs express power over land use conversion is limited to cases in which agricultural lands already awarded have, after five years, ceased to be economically feasible and sound for agricultural purposes, or the locality has become urbanized and the land will have a greater economic value for residential, commercial or industrial purposes. But to suggest that these are the only instances when the DAR can require conversion clearances would open a loophole in R.A. No. 6657, which every landowner may use to evade compliance with the agrarian reform program. Hence, it should logically follow from the said departments express duty and function to execute and enforce the said statute that any reclassification of a private land as a residential, commercial or industrial property should first be cleared by the DAR." The requirement that agricultural lands must go through the process of conversion despite having undergone 24 reclassification was underscored in the case of Alarcon v. Court of Appeals, where it was held that reclassification of land does not suffice: In the case at bar, there is no final order of conversion. The subject landholding was merely reclassified. Conversion is different from reclassification. Conversion is the act of changing the current use of a piece of agricultural land into some other use as approved by the Department of Agrarian Reform. Reclassification, on the other hand, is the act of specifying how agricultural lands shall be utilized for non-agricultural uses such as residential, industrial, commercial, as embodied in the land use plan, subject to the requirements and procedure for land use conversion. Accordingly, a mere reclassification of agricultural land does not automatically allow a landowner to change its use and thus cause the ejectment of the tenants. He has to undergo the process of conversion before he is permitted to use the agricultural land for other purposes. Rep. Act No. 6657 took effect on 15 June 1988. Municipal Ordinance No. 101 of Balamban, Cebu, which reclassified the subject lands, was passed on 25 March 1992, and Provincial Ordinance No. 95-8 of the Provincial Board of Cebu, which adopted Municipal Ordinance No. 101, was passed on 03 April 1995, long after Rep. Act No. 6657 has taken effect. Section 4 of Rep. Act No. 6657 provides: SEC. 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. ... (d) All private lands devoted to or suitable for agriculture regardless of the agricultural products raised or that can be raised thereon. To further clarify any doubt on its authority, the DAR issued Administrative Order No. 12 dated October 1994 which reads: Administrative Order No. 12 Series of 1994 SUBJECT: CONSOLIDATED AND REVISED RULES AND PROCEDURES GOVERNING CONVERSION OF ARICULTURAL LANDS TO NON-AGRICULTURAL USES I. PREFATORY STATEMENT The guiding principles on land use conversion is to preserve prime agricultural lands. On the other hand, conversion of agricultural lands, when coinciding with the objectives of the Comprehensive Agrarian Reform Law to promote social justice, industrialization, and the optimum use of land as a national resource for public welfare, shall be pursued in a speedy and judicious manner.

To rationalize these principles, and by virtue of Republic Act (R.A.) No. 3844, as amended, Presidential Decree (P.D.) No. 27, P.D. No. 946, Executive Order (E.O.) No. 129-A and R.A. No. 6657, the Department of Agrarian Reform (DAR) has issued several policy guidelines to regulate land use conversion. This Administrative Order consolidates and revises all existing implementing guidelines issued by the DAR, taking into consideration, other Presidential issuances and national policies related to land use conversion. II. LEGAL MANDATE A. The Department of Agrarian Reform (DAR) is mandated to "approve or disapprove applications for conversion, restructuring or readjustment of agricultural lands into non-agricultural uses," pursuant to Section 4(i) of Executive Order No. 129-A, Series of 1987. B. Section 5(i) of E.O. No. 129-A, Series of 1987, vests in the DAR, exclusive authority to approve or disapprove applications for conversion of agricultural lands for residential, commercial, industrial, and other land uses. C. Section 65 of R.A. No. 6657, otherwise known as the Comprehensive Agrarian Reform Law of 1988, likewise empowers the DAR to authorize under certain conditions, the reclassification or conversion of agricultural lands. D. Section 4 of Memorandum Circular No. 54, Series of 1993 of the Office of the President, provides that "action on applications for land use conversion on individual landholdings shall remain as the responsibility of the DAR, which shall utilize as its primary reference, documents on the comprehensive land use plans and accompanying ordinances passed upon and approved by the local government units concerned, together with the National Land Use Policy, pursuant to R.A. No. 6657 and E.O. No. 129-A." III. DEFINITION OF TERMS A. Agricultural land refers to land devoted to agricultural activity and not classified as mineral, forest, residential, commercial or industrial land (Section 3[c], R.A. No. 6657). B. Conversion is the act of changing the current use of a piece of agricultural land into some other use. C. Reclassification of agricultural lands is the act of specifying how agricultural lands shall be utilized for non-agricultural uses such as residential, industrial, commercial, as embodied in the land use plan. It also includes the reversion of nonagricultural lands to agricultural use. ... V. COVERAGE These rules shall cover all private agricultural lands as defined herein regardless of tenurial arrangement and commodity produced. It shall also include agricultural lands reclassified by LGUs into non-agricultural uses, after June 15, 1988, pursuant to Memorandum Circular (M.C.) No. 54, Series of 1993 of the Office of the President and those proposed to be used for livestock, poultry and swine raising as provided in DAR Administrative Order No. 9, Series of 1993. In the case of Advincula-Velasquez v. Court of Appeals ,
25

we held:

Our ruling in the Natalia case was reiterated in National Housing Authority v. Allarde (318 SCRA 22 [1999]). The Court of Appeals reliance on DOJ Opinion No. 44, Series of 1990, is in order. In the said opinion, the Secretary of Justice declared, viz: Based on the foregoing premises, we reiterate the view that with respect to conversions of agricultural lands covered by R.A. No. 6657 to non-agricultural uses, the authority of DAR to approve such conversions may be exercised from the date of the laws effectivity on June 15, 1988. This conclusion is based on a liberal interpretation of R.A. No. 6657 in the light of DARs mandate and extensive coverage of the agrarian reform program. Following the DOJ opinion, the DAR issued Administrative Order No. 6, Series of 1994, stating that lands already classified as non-agricultural before the enactment of Rep. Act No. 6657 no longer needed any conversion clearance: I. Prefatory Statement In order to streamline the issuance of exemption clearances, based on DOJ Opinion No. 44, the following guidelines are being issued for the guidance of the DAR and the public in general. II. Legal Basis Sec. 3(c) of RA 6657 states that agricultural lands refers to the land devoted to agricultural activity as defined in this act and not classified as mineral, forest, residential, commercial or industrial land. Department of Justice Opinion No. 44, series of 1990 has ruled that, with respect to the conversion of agricultural lands covered by RA No. 6657 to non-agricultural uses, the authority of DAR to approve such conversion may be exercised from the date of its effectivity, on June 15, 1988. Thus, all lands that are already classified as commercial, industrial, or residential before 15 June 1988 no longer need any conversion clearance.

The authority of the DAR to approve conversions of agricultural lands covered by Rep. Act No. 6657 to non-agricultural 26 uses has not been pierced by the passage of the Local Government Code. The Code explicitly provides that "nothing in this section shall be construed as repealing or modifying in any manner the provisions of Rep. Act No. 6657." It being settled that jurisdiction over conversion of land is vested in the DAR, the complaint for injunction was correctly dismissed by the trial and appellate courts under the doctrine of primary jurisdiction. This Court, in Bautista v. Mag-isa 27 Vda. De Villena, found occasion to reiterate the doctrine of primary jurisdiction The doctrine of primary jurisdiction precludes the courts from resolving a controversy over which jurisdiction has initially been lodged with an administrative body of special competence. For agrarian reform cases, jurisdiction is vested in the Department of Agrarian Reform (DAR); more specifically, in the Department of Agrarian Reform Adjudication Board (DARAB). Executive Order 229 vested the DAR with (1) quasi-judicial powers to determine and adjudicate agrarian reform matters; and (2) jurisdiction over all matters involving the implementation of agrarian reform, except those falling under the exclusive original jurisdiction of the Department of Agriculture and the Department of Environment and Natural Resources. This law divested the regional trial courts of their general jurisdiction to try agrarian reform matters. Under Republic Act 6657, the DAR retains jurisdiction over all agrarian reform matters. The pertinent provision reads: "Section 50. Quasi-Judicial Powers of the DAR. The DAR is hereby vested with the primary jurisdiction to determine and adjudicate agrarian reform matters and shall have exclusive original jurisdiction over all matters involving the implementation of agrarian reform, except those falling under the exclusive jurisdiction of the Department of Agriculture and the Department of Environment and Natural Resources. "It shall not be bound by technical rules of procedure and evidence but shall proceed to hear and decide all cases, disputes or controversies in a most expeditious manner, employing all reasonable means to ascertain the facts of every case in accordance with justice and equity and the merits of the case. Toward this end, it shall adopt a uniform rule of procedure to achieve a just, expeditious and inexpensive determination of every action or proceeding before it. . . ." Finally, the third and fourth issues which may be summed up into whether or not an injunction is the appropriate remedy against the order of the DAR enjoining petitioners in developing the subject land, we rule in the negative. Section 68 of Rep. Act No. 6657 provides: SEC. 68. Immunity of Government Agencies from Undue Interference. No injunction, restraining order, prohibition or mandamus shall be issued by the lower courts against the Department of Agrarian Reform (DAR), the Department of Agriculture (DA), the Department of Environment and Natural Resources (DENR), and the Department of Justice (DOJ) in their implementation of the program. Wherefore, premises considered, the instant petition is Denied for lack of merit. The decision of the Court of Appeals in CA-G.R. SP No. 42666 dated 02 December 1997 affirming the order dated 12 August 1996 of the Regional Trial Court of Toledo City, Branch 29, in Civil Case No. T-590 is AFFIRMED. Costs against petitioners. SO ORDERED. G.R. No. 183409; June 18, 2010 CHAMBER OF REAL ESTATE AND BUILDERS ASSOCIATIONS, INC. (CREBA), petitioner, vs. THE SECRETARY OF AGRARIAN REFORM, Respondent. DECISION PEREZ, J.: This case is a Petition for Certiorari and Prohibition (with application for temporary restraining order and/or writ of preliminary injunction) under Rule 65 of the 1997 Revised Rules of Civil Procedure, filed by herein petitioner Chamber of Real Estate and Builders Associations, Inc. (CREBA) seeking to nullify and prohibit the enforcement of Department of 1 Agrarian Reform (DAR) Administrative Order (AO) No. 01-02, as amended by DAR AO No. 05-07, and DAR 2 Memorandum No. 88, for having been issued by the Secretary of Agrarian Reform with grave abuse of discretion amounting to lack or excess of jurisdiction as some provisions of the aforesaid administrative issuances are illegal and unconstitutional. Petitioner CREBA, a private non-stock, non-profit corporation duly organized and existing under the laws of the Republic of the Philippines, is the umbrella organization of some 3,500 private corporations, partnerships, single proprietorships and individuals directly or indirectly involved in land and housing development, building and infrastructure construction, materials production and supply, and services in the various related fields of engineering, architecture, community planning and development financing. The Secretary of Agrarian Reform is named respondent as he is the duly appointive head of the DAR whose administrative issuances are the subject of this petition.

The Antecedent Facts The Secretary of Agrarian Reform issued, on 29 October 1997, DAR AO No. 07-97, entitled "Omnibus Rules and Procedures Governing Conversion of Agricultural Lands to Non-Agricultural Uses," which consolidated all existing implementing guidelines related to land use conversion. The aforesaid rules embraced all private agricultural lands regardless of tenurial arrangement and commodity produced, and all untitled agricultural lands and agricultural lands reclassified by Local Government Units (LGUs) into non-agricultural uses after 15 June 1988. Subsequently, on 30 March 1999, the Secretary of Agrarian Reform issued DAR AO No. 01-99, entitled "Revised Rules and Regulations on the Conversion of Agricultural Lands to Non-agricultural Uses," amending and updating the previous rules on land use conversion. Its coverage includes the following agricultural lands, to wit: (1) those to be converted to residential, commercial, industrial, institutional and other non-agricultural purposes; (2) those to be devoted to another type of agricultural activity such as livestock, poultry, and fishpond the effect of which is to exempt the land from the Comprehensive Agrarian Reform Program (CARP) coverage; (3) those to be converted to non-agricultural use other than that previously authorized; and (4) those reclassified to residential, commercial, industrial, or other non-agricultural uses 5 6 on or after the effectivity of Republic Act No. 6657 on 15 June 1988 pursuant to Section 20 of Republic Act No. 7 7160 and other pertinent laws and regulations, and are to be converted to such uses. On 28 February 2002, the Secretary of Agrarian Reform issued another Administrative Order, i.e., DAR AO No. 01-02, entitled "2002 Comprehensive Rules on Land Use Conversion," which further amended DAR AO No. 07-97 and DAR AO No. 01-99, and repealed all issuances inconsistent therewith. The aforesaid DAR AO No. 01-02 covers all applications for conversion from agricultural to non-agricultural uses or to another agricultural use. Thereafter, on 2 August 2007, the Secretary of Agrarian Reform amended certain provisions of DAR AO No. 01-02 by formulating DAR AO No. 05-07, particularly addressing land conversion in time of exigencies and calamities. To address the unabated conversion of prime agricultural lands for real estate development, the Secretary of Agrarian Reform further issued Memorandum No. 88 on 15 April 2008, which temporarily suspended the processing and approval of all land use conversion applications. By reason thereof, petitioner claims that there is an actual slow down of housing projects, which, in turn, aggravated the housing shortage, unemployment and illegal squatting problems to the substantial prejudice not only of the petitioner and its members but more so of the whole nation. Hence, this petition. The Issues In its Memorandum, petitioner posits the following issues: I. WHETHER THE DAR SECRETARY HAS JURISDICTION OVER LANDS THAT HAVE BEEN RECLASSIFIED AS RESIDENTIAL, COMMERCIAL, INDUSTRIAL, OR FOR OTHER NON-AGRICULTURAL USES. II. WHETHER THE DAR SECRETARY ACTED IN EXCESS OF HIS JURISDICTION AND GRAVELY ABUSED HIS DISCRETION BY ISSUING AND ENFORCING [DAR AO NO. 01-02, AS AMENDED] WHICH SEEK TO REGULATE RECLASSIFIED LANDS. III. WHETHER [DAR AO NO. 01-02, AS AMENDED] VIOLATE[S] THE LOCAL AUTONOMY OF LOCAL GOVERNMENT UNITS. IV. WHETHER [DAR AO NO. 01-02, AS AMENDED] VIOLATE[S] THE DUE PROCESS AND EQUAL PROTECTION CLAUSE[S] OF THE CONSTITUTION. V. WHETHER MEMORANDUM NO. 88 IS A VALID EXERCISE OF POLICE POWER.
9 8 4 3

The subject of the submission that the DAR Secretary gravely abused his discretion is AO No. 01-02, as amended, which states: Section 3. Applicability of Rules. These guidelines shall apply to all applications for conversion, from agricultural to nonagricultural uses or to another agricultural use, such as: xxxx

3.4 Conversion of agricultural lands or areas that have been reclassified by the LGU or by way of a Presidential Proclamation, to residential, commercial, industrial, or other non-agricultural uses on or after the effectivity of RA 6657 on 15 June 1988, x x x. [Emphasis supplied]. Petitioner holds that under Republic Act No. 6657 and Republic Act No. 8435, the term agricultural lands refers to "lands devoted to or suitable for the cultivation of the soil, planting of crops, growing of fruit trees, raising of livestock, poultry or fish, including the harvesting of such farm products, and other farm activities and practices performed by a farmer in conjunction with such farming operations done by a person whether natural or juridical, and not classified by the law as mineral, forest, residential, commercial or industrial land." When the Secretary of Agrarian Reform, however, issued DAR AO No. 01-02, as amended, he included in the definition of agricultural lands "lands not reclassified as residential, commercial, industrial or other non-agricultural uses before 15 June 1988." In effect, lands reclassified from agricultural to residential, commercial, industrial, or other non-agricultural uses after 15 June 1988 are considered to be agricultural lands for purposes of conversion, redistribution, or otherwise. In so doing, petitioner avows that the Secretary of Agrarian Reform acted without jurisdiction as he has no authority to expand or enlarge the legal signification of the term agricultural lands through DAR AO No. 01-02. Being a mere administrative issuance, it must conform to the statute it seeks to implement, i.e., Republic Act No. 6657, or to the Constitution, otherwise, its validity or constitutionality may be questioned. In the same breath, petitioner contends that DAR AO No. 01-02, as amended, was made in violation of Section 65 of Republic Act No. 6657 because it covers all applications for conversion from agricultural to non-agricultural uses or to other agricultural uses, such as the conversion of agricultural lands or areas that have been reclassified by the LGUs or by way of Presidential Proclamations, to residential, commercial, industrial or other non-agricultural uses on or after 15 June 1988. According to petitioner, there is nothing in Section 65 of Republic Act No. 6657 or in any other provision of law that confers to the DAR the jurisdiction or authority to require that non-awarded lands or reclassified lands be submitted to its conversion authority. Thus, in issuing and enforcing DAR AO No. 01-02, as amended, the Secretary of Agrarian Reform acted with grave abuse of discretion amounting to lack or excess of jurisdiction. Petitioner further asseverates that Section 2.19, Article I of DAR AO No. 01-02, as amended, making reclassification of agricultural lands subject to the requirements and procedure for land use conversion, violates Section 20 of Republic Act No. 7160, because it was not provided therein that reclassification by LGUs shall be subject to conversion procedures or requirements, or that the DARs approval or clearance must be secured to effect reclassification. The said Section 2.19 of DAR AO No. 01-02, as amended, also contravenes the constitutional mandate on local autonomy under Section 13 14 25, Article II and Section 2, Article X of the 1987 Philippine Constitution. Petitioner similarly avers that the promulgation and enforcement of DAR AO No. 01-02, as amended, constitute deprivation of liberty and property without due process of law. There is deprivation of liberty and property without due process of law because under DAR AO No. 01-02, as amended, lands that are not within DARs jurisdiction are unjustly, arbitrarily and oppressively prohibited or restricted from legitimate use on pain of administrative and criminal penalties. More so, there is discrimination and violation of the equal protection clause of the Constitution because the aforesaid administrative order is patently biased in favor of the peasantry at the expense of all other sectors of society. As its final argument, petitioner avows that DAR Memorandum No. 88 is not a valid exercise of police power for it is the prerogative of the legislature and that it is unconstitutional because it suspended the land use conversion without any basis. The Courts Ruling This petition must be dismissed. Primarily, although this Court, the Court of Appeals and the Regional Trial Courts have concurrent jurisdiction to issue writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus and injunction, such concurrence does not give 15 16 the petitioner unrestricted freedom of choice of court forum. In Heirs of Bertuldo Hinog v. Melicor, citing People v. 17 Cuaresma, this Court made the following pronouncements: This Court's original jurisdiction to issue writs of certiorari is not exclusive. It is shared by this Court with Regional Trial Courts and with the Court of Appeals. This concurrence of jurisdiction is not, however, to be taken as according to parties seeking any of the writs an absolute, unrestrained freedom of choice of the court to which application therefor will be directed. There is after all a hierarchy of courts. That hierarchy is determinative of the venue of appeals, and also serves as a general determinant of the appropriate forum for petitions for the extraordinary writs. A becoming regard for that judicial hierarchy most certainly indicates that petitions for the issuance of extraordinary writs against first level ("inferior") courts should be filed with the Regional Trial Court, and those against the latter, with the Court of Appeals. A direct invocation of the Supreme Courts original jurisdiction to issue these writs should be allowed only when there are special and important reasons therefor, clearly and specifically set out in the petition. This is [an] established policy. It is a policy necessary to prevent inordinate demands upon the Courts time and attention which are better devoted to those matters 18 within its exclusive jurisdiction, and to prevent further over-crowding of the Courts docket. (Emphasis supplied.) The rationale for this rule is two-fold: (a) it would be an imposition upon the precious time of this Court; and (b) it would cause an inevitable and resultant delay, intended or otherwise, in the adjudication of cases, which in some instances had
12 11 10

to be remanded or referred to the lower court as the proper forum under the rules of procedure, or as better equipped to 19 resolve the issues because this Court is not a trier of facts. This Court thus reaffirms the judicial policy that it will not entertain direct resort to it unless the redress desired cannot be obtained in the appropriate courts, and exceptional and compelling circumstances, such as cases of national interest and of serious implications, justify the availment of the extraordinary remedy of writ of certiorari, calling for the exercise of its 20 primary jurisdiction. Exceptional and compelling circumstances were held present in the following cases: (a) Chavez v. Romulo, on citizens 22 right to bear arms; (b) Government of [the] United States of America v. Hon. Purganan, on bail in extradition 23 proceedings; (c) Commission on Elections v. Judge Quijano-Padilla, on government contract involving modernization 24 and computerization of voters registration list; (d) Buklod ng Kawaning EIIB v. Hon. Sec. Zamora, on status and 25 existence of a public office; and (e) Hon. Fortich v. Hon. Corona, on the so-called "Win-Win Resolution" of the Office of 26 the President which modified the approval of the conversion to agro-industrial area. In the case at bench, petitioner failed to specifically and sufficiently set forth special and important reasons to justify direct recourse to this Court and why this Court should give due course to this petition in the first instance, hereby failing to fulfill 27 the conditions set forth in Heirs of Bertuldo Hinog v. Melicor. The present petition should have been initially filed in the Court of Appeals in strict observance of the doctrine on the hierarchy of courts. Failure to do so is sufficient cause for the dismissal of this petition. Moreover, although the instant petition is styled as a Petition for Certiorari, in essence, it seeks the declaration by this Court of the unconstitutionality or illegality of the questioned DAR AO No. 01-02, as amended, and Memorandum No. 88. It, thus, partakes of the nature of a Petition for Declaratory Relief over which this Court has only appellate, not original, 28 jurisdiction. Section 5, Article VIII of the 1987 Philippine Constitution provides: Sec. 5. The Supreme Court shall have the following powers: (1) Exercise original jurisdiction over cases affecting ambassadors, other public ministers and consuls, and over petitions for certiorari, prohibition, mandamus, quo warranto, and habeas corpus. (2) Review, revise, reverse, modify, or affirm on appeal or certiorari as the law or the Rules of Court may provide, final judgments and orders of lower courts in: (a) All cases in which the constitutionality or validity of any treaty, international or executive agreement, law, presidential decree, proclamation, order, instruction, ordinance, or regulation is in question. (Emphasis supplied.) With that, this Petition must necessarily fail because this Court does not have original jurisdiction over a Petition for Declaratory Relief even if only questions of law are involved. Even if the petitioner has properly observed the doctrine of judicial hierarchy, this Petition is still dismissible. The special civil action for certiorari is intended for the correction of errors of jurisdiction only or grave abuse of discretion amounting to lack or excess of jurisdiction. Its principal office is only to keep the inferior court within the parameters of its 29 jurisdiction or to prevent it from committing such a grave abuse of discretion amounting to lack or excess of jurisdiction. The essential requisites for a Petition for Certiorari under Rule 65 are: (1) the writ is directed against a tribunal, a board, or an officer exercising judicial or quasi-judicial functions; (2) such tribunal, board, or officer has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction; and (3) there is no appeal or any 30 plain, speedy, and adequate remedy in the ordinary course of law. Excess of jurisdiction as distinguished from absence of jurisdiction means that an act, though within the general power of a tribunal, board or officer, is not authorized and invalid with respect to the particular proceeding, because the conditions 31 which alone authorize the exercise of the general power in respect of it are wanting. Without jurisdiction means lack or want of legal power, right or authority to hear and determine a cause or causes, considered either in general or with 32 reference to a particular matter. It means lack of power to exercise authority. Grave abuse of discretion implies such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction or, in other words, where the power is exercised in an arbitrary manner by reason of passion, prejudice, or personal hostility, and it must be so patent or gross as to amount to an evasion of a positive duty or to a virtual refusal to perform the duty enjoined or to act at all in 33 contemplation of law. In the case before this Court, the petitioner fails to meet the above-mentioned requisites for the proper invocation of a Petition for Certiorari under Rule 65. The Secretary of Agrarian Reform in issuing the assailed DAR AO No. 01-02, as amended, as well as Memorandum No. 88 did so in accordance with his mandate to implement the land use conversion provisions of Republic Act No. 6657. In the process, he neither acted in any judicial or quasi-judicial capacity nor assumed unto himself any performance of judicial or quasi-judicial prerogative. A Petition for Certiorari is a special civil action that may be invoked only against a tribunal, board, or officer exercising judicial functions. Section 1, Rule 65 of the 1997 Revised Rules of Civil Procedure is explicit on this matter, viz.:
21

SECTION 1. Petition for certiorari. When any tribunal, board or officer exercising judicial or quasi-judicial functions has acted without or in excess of its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal, nor any plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment must be rendered annulling or modifying the proceedings of such tribunal, board or officer.1avvphi1 A tribunal, board, or officer is said to be exercising judicial function where it has the power to determine what the law is and what the legal rights of the parties are, and then undertakes to determine these questions and adjudicate upon the rights of the parties. Quasi-judicial function, on the other hand, is "a term which applies to the actions, discretion, etc., of public administrative officers or bodies x x x required to investigate facts or ascertain the existence of facts, hold hearings, 34 and draw conclusions from them as a basis for their official action and to exercise discretion of a judicial nature." Before a tribunal, board, or officer may exercise judicial or quasi-judicial acts, it is necessary that there be a law that gives rise to some specific rights of persons or property under which adverse claims to such rights are made, and the controversy ensuing therefrom is brought before a tribunal, board, or officer clothed with power and authority to determine 35 the law and adjudicate the respective rights of the contending parties. The Secretary of Agrarian Reform does not fall within the ambit of a tribunal, board, or officer exercising judicial or quasijudicial functions. The issuance and enforcement by the Secretary of Agrarian Reform of the questioned DAR AO No. 0102, as amended, and Memorandum No. 88 were done in the exercise of his quasi-legislative and administrative functions and not of judicial or quasi-judicial functions. In issuing the aforesaid administrative issuances, the Secretary of Agrarian Reform never made any adjudication of rights of the parties. As such, it can never be said that the Secretary of Agrarian Reform had acted with grave abuse of discretion amounting to lack or excess of jurisdiction in issuing and enforcing DAR AO No. 01-02, as amended, and Memorandum No. 88 for he never exercised any judicial or quasi-judicial functions but merely his quasi-legislative and administrative functions. Furthermore, as this Court has previously discussed, the instant petition in essence seeks the declaration by this Court of the unconstitutionality or illegality of the questioned DAR AO No. 01-02, as amended, and Memorandum No. 88. Thus, the adequate and proper remedy for the petitioner therefor is to file a Petition for Declaratory Relief, which this Court has only appellate and not original jurisdiction. It is beyond the province of certiorari to declare the aforesaid administrative issuances unconstitutional and illegal because certiorari is confined only to the determination of the existence of grave abuse of discretion amounting to lack or excess of jurisdiction. Petitioner cannot simply allege grave abuse of discretion amounting to lack or excess of jurisdiction and then invoke certiorari to declare the aforesaid administrative issuances unconstitutional and illegal. Emphasis must be given to the fact that the writ of certiorari dealt with in Rule 65 of the 1997 Revised Rules of Civil Procedure is a prerogative writ, never demandable as a matter of right, "never issued except in the 36 exercise of judicial discretion." At any rate, even if the Court will set aside procedural infirmities, the instant petition should still be dismissed. Executive Order No. 129-A vested upon the DAR the responsibility of implementing the CARP. Pursuant to the said mandate and to ensure the successful implementation of the CARP, Section 5(c) of the said executive order authorized the DAR to establish and promulgate operational policies, rules and regulations and priorities for agrarian reform implementation. Section 4(k) thereof authorized the DAR to approve or disapprove the conversion, restructuring or readjustment of agricultural lands into non-agricultural uses. Similarly, Section 5(l) of the same executive order has given the DAR the exclusive authority to approve or disapprove conversion of agricultural lands for residential, commercial, industrial, and other land uses as may be provided for by law. Section 7 of the aforesaid executive order clearly provides that "the authority and responsibility for the exercise of the mandate of the [DAR] and the discharge of its powers and functions shall be vested in the Secretary of Agrarian Reform x x x." Under DAR AO No. 01-02, as amended, "lands not reclassified as residential, commercial, industrial or other nonagricultural uses before 15 June 1988" have been included in the definition of agricultural lands. In so doing, the Secretary of Agrarian Reform merely acted within the scope of his authority stated in the aforesaid sections of Executive Order No. 129-A, which is to promulgate rules and regulations for agrarian reform implementation and that includes the authority to define agricultural lands for purposes of land use conversion. Further, the definition of agricultural lands under DAR AO No. 01-02, as amended, merely refers to the category of agricultural lands that may be the subject for conversion to nonagricultural uses and is not in any way confined to agricultural lands in the context of land redistribution as provided for under Republic Act No. 6657. More so, Department of Justice Opinion No. 44, Series of 1990, which Opinion has been recognized in many cases decided by this Court, clarified that after the effectivity of Republic Act No. 6657 on 15 June 1988 the DAR has been given 38 the authority to approve land conversion. Concomitant to such authority, therefore, is the authority to include in the definition of agricultural lands "lands not reclassified as residential, commercial, industrial or other non-agricultural uses before 15 June 1988" for purposes of land use conversion. In the same vein, the authority of the Secretary of Agrarian Reform to include "lands not reclassified as residential, commercial, industrial or other non-agricultural uses before 15 June 1988" in the definition of agricultural lands finds basis
37

in jurisprudence. In Ros v. Department of Agrarian Reform, this Court has enunciated that after the passage of Republic Act No. 6657, agricultural lands, though reclassified, have to go through the process of conversion, jurisdiction over which is vested in the DAR. However, agricultural lands, which are already reclassified before the effectivity of Republic Act No. 40 6657 which is 15 June 1988, are exempted from conversion. It bears stressing that the said date of effectivity of Republic Act No. 6657 served as the cut-off period for automatic reclassifications or rezoning of agricultural lands that no 41 longer require any DAR conversion clearance or authority. It necessarily follows that any reclassification made thereafter can be the subject of DARs conversion authority. Having recognized the DARs conversion authority over lands reclassified after 15 June 1988, it can no longer be argued that the Secretary of Agrarian Reform was wrongfully given the authority and power to include "lands not reclassified as residential, commercial, industrial or other non-agricultural uses before 15 June 1988" in the definition of agricultural lands. Such inclusion does not unduly expand or enlarge the definition of agricultural lands; instead, it made clear what are the lands that can be the subject of DARs conversion authority, thus, serving the very purpose of the land use conversion provisions of Republic Act No. 6657. The argument of the petitioner that DAR AO No. 01-02, as amended, was made in violation of Section 65 of Republic Act No. 6657, as it covers even those non-awarded lands and reclassified lands by the LGUs or by way of Presidential Proclamations on or after 15 June 1988 is specious. As explained in Department of Justice Opinion No. 44, series of 1990, it is true that the DARs express power over land use conversion provided for under Section 65 of Republic Act No. 6657 is limited to cases in which agricultural lands already awarded have, after five years, ceased to be economically feasible and sound for agricultural purposes, or the locality has become urbanized and the land will have a greater economic value for residential, commercial or industrial purposes. To suggest, however, that these are the only instances that the DAR can require conversion clearances would open a loophole in Republic Act No. 6657 which every landowner may use to evade compliance with the agrarian reform program. It should logically follow, therefore, from the said departments express duty and function to execute and enforce the said statute that any reclassification of a private land as a residential, commercial or industrial property, on or after the effectivity of Republic Act No. 6657 on 15 June 1988 42 should first be cleared by the DAR. This Court held in Alarcon v. Court of Appeals that reclassification of lands does not suffice. Conversion and reclassification differ from each other. Conversion is the act of changing the current use of a piece of agricultural land into some other use as approved by the DAR while reclassification is the act of specifying how agricultural lands shall be utilized for non-agricultural uses such as residential, industrial, and commercial, as embodied in the land use plan, subject to the requirements and procedures for land use conversion. In view thereof, a mere reclassification of an agricultural land does not automatically allow a landowner to change its use. He has to undergo the process of conversion before he is 44 permitted to use the agricultural land for other purposes. It is clear from the aforesaid distinction between reclassification and conversion that agricultural lands though reclassified to residential, commercial, industrial or other non-agricultural uses must still undergo the process of conversion before they can be used for the purpose to which they are intended. Nevertheless, emphasis must be given to the fact that DARs conversion authority can only be exercised after the 45 effectivity of Republic Act No. 6657 on 15 June 1988. The said date served as the cut-off period for automatic reclassification or rezoning of agricultural lands that no longer require any DAR conversion clearance or 46 authority. Thereafter, reclassification of agricultural lands is already subject to DARs conversion au thority. Reclassification alone will not suffice to use the agricultural lands for other purposes. Conversion is needed to change the current use of reclassified agricultural lands. It is of no moment whether the reclassification of agricultural lands to residential, commercial, industrial or other nonagricultural uses was done by the LGUs or by way of Presidential Proclamations because either way they must still undergo conversion process. It bears stressing that the act of reclassifying agricultural lands to non-agricultural uses simply specifies how agricultural lands shall be utilized for non-agricultural uses and does not automatically convert agricultural lands to non-agricultural uses or for other purposes. As explained in DAR Memorandum Circular No. 7, Series of 1994, cited in the 2009 case of Roxas & Company, Inc. v. DAMBA-NFSW and the Department of Agrarian 47 Reform, reclassification of lands denotes their allocation into some specific use and providing for the manner of their utilization and disposition or the act of specifying how agricultural lands shall be utilized for non-agricultural uses such as residential, industrial, or commercial, as embodied in the land use plan. For reclassified agricultural lands, therefore, to be used for the purpose to which they are intended there is still a need to change the current use thereof through the process of conversion. The authority to do so is vested in the DAR, which is mandated to preserve and maintain agricultural lands with increased productivity. Thus, notwithstanding the reclassification of agricultural lands to non-agricultural uses, they must still undergo conversion before they can be used for other purposes. Even reclassification of agricultural lands by way of Presidential Proclamations to non-agricultural uses, such as school sites, needs conversion clearance from the DAR. We reiterate that reclassification is different from conversion. Reclassification alone will not suffice and does not automatically allow the landowner to change its use. It must still 48 undergo conversion process before the landowner can use such agricultural lands for such purpose. Reclassification of agricultural lands is one thing, conversion is another. Agricultural lands that are reclassified to non-agricultural uses do not ipso facto allow the landowner thereof to use the same for such purpose. Stated differently, despite having reclassified
43

39

into school sites, the landowner of such reclassified agricultural lands must apply for conversion before the DAR in order to use the same for the said purpose. Any reclassification, therefore, of agricultural lands to residential, commercial, industrial or other non-agricultural uses either by the LGUs or by way of Presidential Proclamations enacted on or after 15 June 1988 must undergo the process of conversion, despite having undergone reclassification, before agricultural lands may be used for other purposes. It is different, however, when through Presidential Proclamations public agricultural lands have been reserved in whole or in part for public use or purpose, i.e., public school, etc., because in such a case, conversion is no longer necessary. As 49 held in Republic v. Estonilo, only a positive act of the President is needed to segregate or reserve a piece of land of the public domain for a public purpose. As such, reservation of public agricultural lands for public use or purpose in effect converted the same to such use without undergoing any conversion process and that they must be actually, directly and exclusively used for such public purpose for which they have been reserved, otherwise, they will be segregated from the 50 reservations and transferred to the DAR for distribution to qualified beneficiaries under the CARP. More so, public agricultural lands already reserved for public use or purpose no longer form part of the alienable and disposable lands of 51 the public domain suitable for agriculture. Hence, they are outside the coverage of the CARP and it logically follows that they are also beyond the conversion authority of the DAR. Clearly from the foregoing, the Secretary of Agrarian Reform did not act without jurisdiction or in excess of jurisdiction or with grave abuse of discretion amounting to lack or excess of jurisdiction in (1) including lands not reclassified as residential, commercial, industrial or other non-agricultural uses before 15 June 1988 in the definition of agricultural lands under DAR AO No. 01-02, as amended, and; (2) issuing and enforcing DAR AO No. 01-02, as amended, subjecting to DARs jurisdiction for conversion lands which h ad already been reclassified as residential, commercial, industrial or for other non-agricultural uses on or after 15 June 1988. Similarly, DAR AO No. 01-02, as amended, providing that the reclassification of agricultural lands by LGUs shall be subject to the requirements of land use conversion procedure or that DARs approval or clearance must be secured to effect reclassification, did not violate the autonomy of the LGUs. Section 20 of Republic Act No. 7160 states that: SECTION 20. Reclassification of Lands. (a) A city or municipality may, through an ordinance passed by the sanggunian after conducting public hearings for the purpose, authorize the reclassification of agricultural lands and provide for the manner of their utilization or disposition in the following cases: (1) when the land ceases to be economically feasible and sound for agricultural purposes as determined by the Department of Agriculture or (2) where the land shall have substantially greater economic value for residential, commercial, or industrial purposes, as determined by the sanggunian concerned: Provided, That such reclassification shall be limited to the following percentage of the total agricultural land area at the time of the passage of the ordinance: xxxx (3) For fourth to sixth class municipalities, five percent (5%): Provided, further, That agricultural lands distributed to agrarian reform beneficiaries pursuant to Republic Act Numbered Sixty-six hundred fifty-seven (R.A. No. 6657), otherwise known as "The Comprehensive Agrarian Reform Law," shall not be affected by the said reclassification and the conversion of such lands into other purposes shall be governed by Section 65 of said Act. xxxx (e) Nothing in this Section shall be construed as repealing, amending, or modifying in any manner the provisions of R.A. No. 6657. The aforequoted provisions of law show that the power of the LGUs to reclassify agricultural lands is not absolute. The authority of the DAR to approve conversion of agricultural lands covered by Republic Act No. 6657 to non-agricultural uses has been validly recognized by said Section 20 of Republic Act No. 7160 by explicitly providing therein that, "nothing in this section shall be construed as repealing or modifying in any manner the provisions of Republic Act No. 6657." DAR AO No. 01-02, as amended, does not also violate the due process clause, as well as the equal protection clause of the Constitution. In providing administrative and criminal penalties in the said administrative order, the Secretary of Agrarian Reform simply implements the provisions of Sections 73 and 74 of Republic Act No. 6657, thus: Sec. 73. Prohibited Acts and Omissions. The following are prohibited: xxxx (c) The conversion by any landowner of his agricultural land into any non-agricultural use with intent to avoid the application of this Act to his landholdings and to disposes his tenant farmers of the land tilled by them; xxxx

(f) The sale, transfer or conveyance by a beneficiary of the right to use or any other usufructuary right over the land he acquired by virtue of being a beneficiary, in order to circumvent the provisions of this Act. xxxx Sec. 74. Penalties. Any person who knowingly or willfully violates the provisions of this Act shall be punished by imprisonment of not less than one (1) month to not more than three (3) years or a fine of not less than one thousand pesos (P1,000.00) and not more than fifteen thousand pesos (P15,000.00), or both, at the discretion of the court. If the offender is a corporation or association, the officer responsible therefor shall be criminally liable. And Section 11 of Republic Act No. 8435, which specifically provides: Sec. 11. Penalty for Agricultural Inactivity and Premature Conversion. x x x. Any person found guilty of premature or illegal conversion shall be penalized with imprisonment of two (2) to six (6) years, or a fine equivalent to one hundred percent (100%) of the government's investment cost, or both, at the discretion of the court, and an accessory penalty of forfeiture of the land and any improvement thereon. In addition, the DAR may impose the following penalties, after determining, in an administrative proceedings, that violation of this law has been committed: a. Consolation or withdrawal of the authorization for land use conversion; and b. Blacklisting, or automatic disapproval of pending and subsequent conversion applications that they may file with the DAR. Contrary to petitioners assertions, the administrative and criminal penalties provided for under DAR AO No. 01 -02, as amended, are imposed upon the illegal or premature conversion of lands within DARs jurisdiction, i.e., "lands not reclassified as residential, commercial, industrial or for other non-agricultural uses before 15 June 1998." The petitioners argument that DAR Memorandum No. 88 is unconstitutional, as it suspe nds the land use conversion without any basis, stands on hollow ground. It bears emphasis that said Memorandum No. 88 was issued upon the instruction of the President in order to address the unabated conversion of prime agricultural lands for real estate development because of the worsening rice shortage in the country at that time. Such measure was made in order to ensure that there are enough agricultural lands in which rice cultivation and production may be carried into. The issuance of said Memorandum No. 88 was made pursuant to the general welfare of the public, thus, it cannot be argued that it was made without any basis. WHEREFORE, premises considered, the instant Petition for Certiorari is DISMISSED. Costs against petitioner. SO ORDERED. G.R. No. 131457; August 19, 1999 HON. CARLOS O. FORTICH, PROVINCIAL GOVERNOR OF BUKIDNON, HON. REY B. BAULA, MUNICIPAL MAYOR OF SUMILAO, BUKIDNON, NQSR MANAGEMENT AND DEVELOPMENT CORPORATION, petitioners, vs. HON. RENATO C. CORONA, DEPUTY EXECUTIVE SECRETARY, HON. ERNESTO D. GARILAO, SECRETARY OF THE DEPARTMENT OF AGRARIAN REFORM, respondents. RESOLUTION YNARES-SANTIAGO, J.: This resolves the pending incidents before us, namely, respondents' and intervenors' separate motions for reconsideration of our Resolution dated November 17, 1998, as well as their motions to refer this case to this Court En banc. Respondents and intervenors jointly argue, in fine, that our Resolution dated November 17, 1998, wherein we voted twotwo on the separate motions for reconsideration of our earlier Decision or April 24, 1998, as a result of which the Decision was deemed affirmed, did not effectively resolve the said motions for reconsideration inasmuch as the matter should have been referred to the Court sitting en banc, pursuant to Article VIII, Section 4(3) of the Constitution. Respondents and intervenors also assail our Resolution dated January 27, 1999, wherein we noted without action the intervenors' "Motion For Reconsideration With Motion To Refer The Matter To The Court En Banc" filed on December 3, 1998, on the following considerations, to wit: the movants have no legal personality to further seek redress before the Court after their motion for leave to intervene in this case was denied in the April 24, 1998 Decision. Their subsequent motion for reconsideration of the said decision, with a prayer to resolve the motion to the Court En Banc, was also denied in the November 17, 1998 Resolution of the Court. Besides, their aforesaid motion of December 3, 1998 is in the nature of a second motion for reconsideration which is a forbidden motion (Section 2, Rule 52 in relation to Section 4, Rule 56 of the

1997 Rules of Civil Procedure). The impropriety of movants' December 3, 1998 motion becomes all the more glaring considering that all the respondents in this case did not anymore join them (movants) ill seeking a 1 reconsideration of the November 17, 1998 Resolution. Subsequently, respondents, through the Office of the Solicitor General, filed their "Motion For Reconsideration Of The Resolution Dated November 17, 1998 And For Referral Of The Case To This Honorable Court En Banc (With Urgent 2 Prayer For Issuance Of A Restraining Order)" on December 3, 1998, accompanied by a "Manifestation and Motion" and 3 a copy of the Registered Mail Bill evidencing filing of the said motion for reconsideration to this Court by registered mail.1wphi1.nt In their respective motions for reconsideration, both respondents and intervenors pray that this case be referred to this Court en banc. They contend that inasmuch as their earlier motions for reconsideration (of the Decision dated April 24, 1998) were resolved by a vote of two-two, the required number to carry a decision, i.e., three, was not met. Consequently, the case should be referred to and be decided by this Court e n banc, relying on the following constitutional provision: Cases or matters heard by a division shall be decided or resolved with the concurrence of a majority of the Members who actually took part in the deliberations on the issues in the case and voted thereon, and in no case without the concurrence of at least three of such Members. When the required number is not obtained, the case shall be decided en banc: Provided, that no doctrine or principle of law laid down by the Court in a decision 4 rendered en banc or in division may be modified or reversed except by the Court sitting en banc. A careful reading of the above constitutional provision, however, reveals the intention of the framers to draw a distinction between cases, on the one hand, and matters, on the other hand, such that cases are "decided" whilematters, which include motions, are "resolved". Otherwise put, the word "decided" must refer to "cases"; while the word "resolved" must refer to "matters", applying the rule of reddendo singula singulis. This is true not only in the interpretation of the above5 quoted Article VIII, Section 4(3), but also of the other provisions of the Constitution where these words appear. With the aforesaid rule of construction in mind, it is clear that only cases are referred to the Court en banc for decision whenever the required number of votes is not obtained. Conversely, the rule does not apply where, as in this case, the required three votes is not obtained in the resolution of a motion for reconsideration. Hence, the second sentence of the aforequoted provision speaks only of "case" and not "matter". The reason is simple. The above-quoted Article VIII, Section 4(3) pertains to the disposition of cases by a division. If there is a tie in the voting, there is no decision. The only way to dispose of the case then is to refer it to the Court en banc. On the other hand, if a case has already been decided by the division and the losing party files a motion for reconsideration, the failure of the division to resolve the motion because of a tie in the voting does not leave the case undecided. There is still the decision which must stand in view of the failure of the members of the division to muster the necessary vote for its reconsideration. Quite plainly, if the voting results in a tie, the motion for reconsideration is lost. The assailed decision is not reconsidered and must therefore be deemed affirmed. Such was the ruling of this Court in the Resolution of November 17, 1998. It is the movants' further contention in support of their plea for the referral of this case to the Court en banc that the issues submitted in their separate motions are of first impression. In the opinion penned by Mr. Justice Antonio M. Martinez during the resolution of the motions for reconsideration on November 17, 1998, the following was expressed: Regrettably, the issues presented before us by the movants are matters of no extraordinary import to merit the attention of the Court En Banc. Specifically, the issue of whether or not the power of the local government units to reclassify lands is subject to the approval of the DAR is no longer novel, this having been decided by this Court in the case of Province of Camarines Sur, et al. vs. Court of Appeals wherein we held that local government units need not obtain the approval of the DAR to convert or reclassify lands from agricultural to non-agricultural use. The dispositive portion of the Decision in the aforecited case states: WHEREFORE, the petition is GRANTED and the questioned decision of the Court of Appeals is set aside insofar as it (a) nullifies the trial court's order allowing the Province of Camarines Sur to take possession of private respondent's property (b) orders the trial court to suspended the exportation proceedings; and (c) requires the Province of Camarines Sur to obtain the approval of the Department of Agrarian Reform to convert or reclassify private respondents' property from agricultural to non-agricultural use. xxx xxx x x x(Emphasis supplied)

Moreover, the Decision sought to be reconsidered was arrived at by a unanimous vote of all five (5) members of the Second Division of this Court, Stated otherwise, this Second Division is of the opinion that the matters raised by movants are nothing new and do not deserve the consideration of the Court en banc. Thus, the participation of 6 the full Court in the resolution of movants' motions for reconsideration would be inappropriate. The contention, therefore, that our Resolution of November 17, 1998 did not dispose of the earlier motions for reconsideration of the Decision dated April 24, 1998 is flawed. Consequently, the present motions for reconsideration necessarily partake of the nature of a second motion for reconsideration which, according to the clear and unambiguous language of Rule 56, Section 4, in relation to Rule 52, Section 2, of the 1997 Rules of Civil Procedure, is prohibited.

True, there are exceptional cases when this Court may entertain a second motion for reconsideration, such as where there are extraordinarily persuasive reasons. Even then, we have ruled that such second motions for reconsideration must 7 be filed with express leave of court first obtained. In this case, not only did movants fail to ask for prior leave of court, but more importantly, they have been unable to show that there are exceptional reasons for us to give due course to their second motions for reconsideration. Stripped of the arguments for referral of this incident to the Court en banc, the motions subject of this resolution are nothing more but rehashes of the motions for reconsideration which have been denied in the Resolution of November 17, 1998. To be sure, the allegations contained therein have already been raised before and passed upon by this Court in the said Resolution. The crux of the controversy is the validity of the "Win-Win" Resolution dated November 7, 1997. We maintain that the same is void and of no legal effect considering that the March 29, 1996 decision of the Office of the President had already become final and executory even prior to the filing of the motion for reconsideration which became the basis of the said "Win-Win" Resolution. This ruling, quite understandably, sparked a litany of protestations on the part of respondents and intervenors including entreaties for a liberal interpretation of the rules. The sentiment was that notwithstanding its importance and far-reaching effects, the case was disposed of on a technicality. The situation, however, is not as simple as what the movants purport it to be. While it may be true that on its face the nullification of the "Win-Win" Resolution was grounded on a procedural rule pertaining to the reglementary period to appeal or move for reconsideration, the underlying consideration therefor was the protection of the substantive rights of petitioners. The succinct words of Mr. Justice Artemio V. Panganiban are quoted in the November 17, 1998 opinion of Mr. Justice Martinez, viz.: "Just as a losing party has the right to file an appeal within the prescribed period, the winning party also has the correlative right to enjoy the finality of 8 the resolution of his/her case." In other words, the finality of the March 29, 1996 OP Decision accordingly vested appurtenant rights to the land in dispute on petitioners as well as on the people of Bukidnon and other parts of the country who stand to be benefited by the development of the property. The issue in this case, therefore, is not a question of technicality but of substance and 9 merit. Before finally disposing of these pending matters, we feel it necessary to rule once and for all on the legal standing of intervenors in this case. In their present motions, intervenors insist that they are real parties in interest inasmuch as they have already been issued certificates of land ownership award, or CLOAs, and that while they are seasonal farmworkers at the plantation, they have been identified by the DAR as qualified beneficiaries of the property. These arguments are, however, nothing new as in fact they have already been raised in intervenors' earlier motion for reconsideration of our April 24, 1998 Decision. Again as expressed in the opinion of Mr. Justice Martinez, intervenors, who are admittedly not regular but seasonal farmworkers, have no legal or actual and substantive interest over the subject land inasmuch as they 10 have no right to own the land. Rather, their right is limited only to a just share of the fruits of the land. Moreover, the "Win-Win" Resolution itself states that the qualified beneficiaries have yet to be carefully and meticulously determined by 11 the Department of Agrarian Reform. Absent any definitive finding of the Department of Agrarian Reform, intervenors cannot as yet be deemed vested with sufficient interest in the controversy as to be qualified to intervene in this case. Likewise, the issuance of the CLOA's to them does not grant them the requisite standing in view of the nullity of the "WinWin" Resolution. No legal rights can emanate from a resolution that is null and void. WHEREFORE, based on the foregoing, the following incidents, namely: intervenors' "Motion For Reconsideration With Motion To Refer The Matter To The Court En Banc," dated December 3, 1998; respondents' "Motion For Reconsideration Of The Resolution Dated November 17, 1998 And For Referral Of The Case To This Honorable Court En Banc (With Urgent Prayer For Issuance Of A Restraining Order)," dated December 2, 1998; and intervenors' "Urgent Omnibus Motion For The Supreme Court Sitting En Banc To Annul The Second Division's Resolution Dated 27 January 1999 And Immediately Resolve The 28 May 1998 Motion For Reconsideration Filed By The Intervenors," dated March 2, 1999; are all DENIED with FINALITY. No further motion, pleading, or paper will be entertained in this case. SO ORDERED. Melo, J., please see separate opinion. Puno, J., in the result. I maintain my original position that the case should go to CA for further proceedings. Mendoza, J., in the result. Separate Opinions MELO, J., separate opinion; On the merits, I still maintain my vote with Mr. Justice Puno that this case should be referred to the Court of Appeals for further proceedings. Since what is now before us is a second motion for reconsideration, which under the rules is generally proscribed, the majority deemed it pertinent to limit its resolution in regard to cogent procedural points.

At the outset, I wish to point out that inasmuch as I am bound to abide by the Court En Banc's Resolution No. 99-109-SC dated January 2, 1999, which settled the issue of an even (2-2) vote in a division, I am constrained to vote with the majority in denying all of the subject motions in the above-captioned case. Nevertheless, I wish to express my views on this issue and put them or record, so, in the event that the Court decides to open and re-discuss this issue at some future time, these consideration may be referred to. I continue to have some reservations regarding majority's position regarding an even (2-2) vote in a division, due to the following considerations: By mandate of the Constitution, cases heard by a division when the required majority of at least 3 votes in the division is not obtained are to be heard and decided by the Court En Banc. Specifically, Paragraph 3, Section 4, Article VIII of the Constitution provides that: xxx xxx xxx

(3) Cases or matters heard by a division shall e decided or resolved with the concurrence of a majority of the members who actually took part in the deliberations on the issues in the case and voted thereon, and in no case, without the concurrence of at least three of such members. When the required number is not obtained, the case shall be decided en banc: provided, that no doctrine or principle of law laid down by the court in a decision rendered en banc or in division may be modified or reversed by the court sitting en banc. The deliberations of the 1986 Constitutional Commission disclose that if the case is not decided in a division by a majority vote, it goes to the Court En Banc and not to a longer division. Moreover, the elevation of a case to the Banc shall be automatic. Thus, MR. RODRIGO: Madam President, may I ask some questions for clarification. MR. PRESIDENT: Commissioner Rodrigo is recognized. MR. RODRIGO: Under these provisions, there are 3 kinds of divisions: one would be a division composed of 3 justices in which case there will be 5 divisions; another division is composed of 5 justices each, in which case there will be 3 divisions; and the other is composed of 7 members each, in which case, there will be 2 divisions. Let us take the smallest division of 3 and the vote is 2-1. So, it is less than 3 votes. Should it immediately go to the court en banc of 15 justices or should it first go to a bigger division? MR. CONCEPCION: Yes. MR. RODRIGO: They immediately go to the court en banc? MR. SUAREZ: Yes, Madam President. MR. RODRIGO: Is that automatic? Let us say that in the division of 3, the vote is 2-1, automatically it goes to the court en banc? MR. SUAREZ: Yes, because the required number of 3 is not obtained. So, this last phrase would operate automatically "WHEN THE REQUIRED NUMBER IS NOT OBTAINED, THE CASE SHALL BE DECIDED EN BANC." xxx xxx xxx

(V Record 635, Oct. 8, 1986) Explicit, therefore, is the requirement that at least 3 members must concur in any case or matter heard by a division . Failing thus, or, when the required number of 3 votes is not obtained, the case or matter will have to be decided by the Court En Banc. In a situation where a division of 5 has only 4 members, the 5th member having inhibited himself or is otherwise not in a position to participate, or has retired, a minimum of 3 votes would still be required before there can be any valid decision or resolution by that division. There may, then, be instances when a deadlock may occur, i.e., the votes tied at 2-2. It is my humble view that under the clear and unequivocal provisions of the 1986 Constitution, if the required majority is not reached in a division, the case should automatically got to the Court En Banc. A distinction has been made between "cases" and "matters" referred to in the above-quoted constitutional provision. "Cases" being decided, and "matters" being resolved. Only "cases" are referred to the Court En Bancfor decision whenever the required number of votes is not obtained Matters" are not referred anymore. I regret I cannot square with such position. The majority view is that "cases" would only refer to deliberations at first instance on the merits of a case filed with the Court, and other deliberations, such as motions, including motions of reconsideration, are "matters" to be resolved. To

give flesh to this distinction, it is cited that if a tie occurs in the voting on motions for reconsideration, the decision which already been passed stands. This is not true all the time. It may be true only in original cases, as opposed to appealed cases, filed with the Court. However, because of the doctrine of hierarchy of courts, to only original cases which are taken cognizable of by this Court are those wherein it has exclusive jurisdiction. But, invariably, these cases are all required by the Constitution to be heard by the Court En Banc. so, there will be no instance when a division will be ever taking cognizance of an original actions filed with this Court. It may be noted that cases taken cognizable of by the divisions are either petitions for review on certiorari under Rule 45 or petitions for certiorari, prohibition or mandamus, under Rule 65. Under Rule 45, appeal by way of petition for review on certiorari is not a matter of right. Thus, should there be a tie in the voting on deliberation of a "case" by the division, although apparently no action is passed, a decision may still be rendered the petition is thereby DENIED due course, and it is forthwith DISMISSED. This is definitely in consonance with the majority's line of reasoning in the 2-2 vote on motions for reconsideration. But why is it that, the 2-2 vote in the deliberation of the "case" at the first instance should still be referred to the Court En Banc? The reason is simple. Because the express provision of the Constitution requires a vote of at least three justices for there to be a valid and binding decision of the Court. But, why do we not apply the same rule to motions for reconsideration? Even on this score alone, it is my view that, in all instances, whether it be in the deliberations of a case at first instance or on a motion for reconsideration, a division having a 2-2 vote cannot pass action.1wphi1.nt I submit that the requirement of 3 votes equally applies to motions for reconsideration because the provision contemplates "cases" or "matters" (which for me has no material distinction insofar as divisions are concerned) heard by a division, and a motion for reconsideration cannot be divorced from the decision in a case that it seeks to be reconsidered. Consequently, if the required minimum majority of 3 votes is not met, the matter of the motion for reconsideration has to be heard by the Court En Banc, as mandated by the Constitution (par. 3, Sec. 4, Art. VIII). To say that the motion is lost in the division on 2-2 vote, is to construe something which cannot be sustained by a reading of the Constitution. To argue that a motion for reconsideration is not a "case" but only a "matter" which does not concern a case, so that, even through the vote thereon in the division is 2-2, the matter or issue is not required to be elevated to the Court En Banc, is to engage in a lot of unfounded hairsplitting. Furthermore, I humbly submit that the theory of leaving the issue hanging on a 2-2 vote or any even vote may be sustained only in cases where there is no recourse to a higher assemblage. In the Court of Appeals, for instance, an even vote in a division of 5 (2-2, with 1 abstaining) would result in the motion not being carried, but only because there is and there cannot be recourse to the Court of Appeals En Bancwhich, does not act on judicial matters. In a legislative body, an even vote results in the failure of the proposition, only because there is no higher body which can take over. In our own Court En Banc, if there voting is evenly split, on a 7-7 vote with 1 slot vacant, or with 1 justice inhibiting or disqualifying himself, the motion shall, of course, not be carried because that is the end of the line. But in the situation now facing us, the even vote is in a division, and there being recourse to the Court En Banc, and more so, this being expressly directed by the Constitution, the matter of the motion for reconsideration should, by all means, be decided by the Court En Banc.