RESTRICTIONS IN BUYING A FARM OR AGRICULTURAL LOT UNDER PHILIPPINE LAWS | CLOA & DAR CLEARANCE

Are you thinking of buying a farm or agricultural land? Watch this video first!

Many think that real estate transactions involving farm or agricultural lands are just the same as any other real property dealing. This notion most often leads to problems, especially when the purchase transaction is already completed, and the realization does not come until the buyer attempts to have the title transferred in his/her name.

This is because the Register of Deeds requires, on top of the other requirements, the Transfer Clearance from the Department of Agrarian Reform or the DAR Clearance. The DAR, in turn, requires proof that the vendor’s and the vendee’s aggregate landholdings do not exceed five (5) hectares. This is in view of the limitation imposed by the Comprehensive Agrarian Reform Law (CARL or RA 6657) on ownership of agricultural lands — that is, no one should own more than five (5) hectares. This prohibition continues under RA 9700 or the Comprehensive Agrarian Reform Law Extension with Reforms (CARPER).

DAR Administrative Order No. 04, Series of 2021, which was issued on May 17, 2021, has streamlined the process and the requirements in requesting for Land Transfer Clearance (DAR Clearance).

Note that the government may acquire agricultural land, through expropriation or by purchase, even beyond the 5-hectare limit. Government entities are also exempt from the requirement of DAR Clearance.

In the case of Agrarian Reform Cooperatives, the retention area or land ownership limit is computed as number of members multiplied by five (5) hectares.

Topics discussed and other related topics: DAR Clearance or Land Transfer Clearance; Department of Agrarian Reform; CLOA or Certificate of Land Ownership Award; Certificate of Title; Register of Deeds; Comprehensive Agrarian Reform Program or CARP; Comprehensive Agrarian Reform Law or CARL (Republic Act 6657); Comprehensive Agrarian Reform Law Extension with Reforms or CARPER (RA 9700); five (5) hectare retention limit; ownership limitation or ceiling; agrarian reform beneficiaries; affidavit of aggregate landholdings; certificate of aggregate landholdings; municipal or city assessor; provincial assessor; use conversion; compensable land; Land Bank of the Philippines; real estate; real estate law; real property law; land registration; agrarian reform beneficiaries.

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