Republic Act No 7881

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R E P U B L I C A C T N O . 7 8 8 1 P a g e | 1REPUBLIC ACT NO. 7881

AN ACT AMENDING CERTAIN PROVISIONS OF

REPUBLIC ACT NO. 6657, ENTITLED "AN ACT

INSTITUTING A COMPREHENSIVE AGRARIAN

REFORM PROGRAM TO PROMOTE SOCIAL

JUSTICE AND INDUSTRIALIZATION,PROVIDING THE MECHANISM FOR ITS

IMPLEMENTATION, AND FOR OTHER

PURPOSES"

SECTION 1. Section 3, Paragraph (b) ofRepublicAct No. 6657is hereby amended to read as follows:

"Sec. 3. Definitions. For the purpose of this Act,unless the context indicates otherwise:

"(b) Agriculture, Agricultural Enterprise or

Agricultural Activity means the cultivation of thesoil, planting of crops, growing of fruit trees,including the harvesting of such farm products, andother farm activities and practices performed by afarmer in conjunction with such farming operationsdone by persons whether natural or juridical."

Sec. 2. Section 10 ofRepublic Act No. 6657ishereby amended to read as follows:

"Sec. 10. Exemptions and Exclusions.

"(a) Lands actually, directly and exclusively usedfor parks, wildlife, forest reserves, reforestation, fishsanctuaries and breeding grounds, watersheds andmangroves shall be exempt from the coverage ofthis Act."(b) Private lands actually, directly and exclusivelyused for prawn farms and fishponds shall beexempt from the coverage of this Act: Provided,That said prawn farms and fishponds have notbeen distributed and Certificate of Land Ownership

Award (CLOA) issued to agrarian reformbeneficiaries under the Comprehensive Agrarian

Reform Program.

"In cases where the fishponds or prawn farms havebeen subjected to the Comprehensive AgrarianReform Law, by voluntary offer to sell, orcommercial farms deferment or notices ofcompulsory acquisition, a simple and absolutemajority of the actual regular workers or tenantsmust consent to the exemption within one (1) year

from the effectivity of this Act. When the workers ortenants do not agree to this exemption, thefishponds or prawn farms shall be distributedcollectively to the worker-beneficiaries or tenantswho shall form a cooperative or association tomanage the same.

"In cases where the fishponds or prawn farms havenot been subjected to the Comprehensive AgrarianReform Law, the consent of the farm workers shallno longer be necessary, however, the provision ofSection 32-A hereof on incentives shall apply."

"(c) Lands actually, directly and exclusively usedand found to be necessary for national defense,school sites and campuses, including experimentalfarm stations operated by public or private schoolsfor educational purposes, seeds and seedling

research and pilot production center, church sitesand convents appurtenant thereto, mosque sitesand Islamic centers appurtenant thereto, communalburial grounds and cemeteries, penal colonies andpenal farms actually worked by the inmates,government and private research and quarantinecenters and all lands with eighteen percent (18%)slope and over, except those already developed,shall be exempt from the coverage of this Act."

Sec. 3. Section 11 Paragraph 1 is hereby amendedto read as follows:

"Sec. 11. Commercial Farming. Commercialfarms, which are private agricultural lands devotedto saltbeds, fruit farms, orchards, vegetable andcut-flower farms, and cacao, coffee and rubberplantations, shall be subject to immediatecompulsory acquisition and distribution after ten(10) years from the effectivity of this Act.In the caseof new farms, the ten-year period shall begin fromthe first year of commercial production andoperation, as determined by the DAR.During theten-year period, the Government shall initiate steps

necessary to acquire these lands, upon payment ofjust compensation for the land and theimprovements thereon, preferably in favor oforganized cooperatives or associations which shallthereafter manage the said lands for the workers-beneficiaries."
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R E P U B L I C A C T N O . 7 8 8 1 P a g e | 2Sec. 4. There shall be incorporated after Section 32ofRepublic Act No. 6657a new section to read asfollows:

"Sec. 32-A. Incentives. Individuals or entitiesowning or operating fishponds and prawn farms are

hereby mandated to execute within six (6) monthsfrom the effectivity of this Act an incentive plan withtheir regular fishpond or prawn farmworkers orfishpond or prawn farm workers' organization, ifany, whereby seven point five percent (7.5%) oftheir net profit before tax from the operation of thefishpond or prawn farms are distributed within sixty(60) days at the end of the fiscal year ascompensation to regular and other pond workers insuch ponds over and above the compensation theycurrently receive."In order to safeguard the right of the regular

fishpond or prawn farm workers under the incentiveplan, the books of the fishpond or prawn farmowners shall be subject to periodic audit orinspection by certified public accountants chosenby the workers."The foregoing provision shall not apply toagricultural lands subsequently converted tofishpond or prawn farms provided the size of theland converted does not exceed the retention limitof the landowner."

Sec. 5. There shall be incorporated after Section 65

of Republic Act No. 6657 new sections to read asfollows:

"Sec. 65-A. Conversion into Fishpond and PrawnFarms. No conversion of public agricultural landsinto fishponds and prawn farms shall be madeexcept in situations where the provincialgovernment with the concurrence of the Bureau ofFisheries and Aquatic Resources (BFAR) declaresa coastal zone as suitable for fishponddevelopment.In such case, the Department ofEnvironment and Natural Resources (DENR) shall

allow the lease and development of such areas:Provided, That the declaration shall not apply toenvironmentally critical projects and areas ascontained in title (A) sub-paragraph two, (B-5) and(C-1) and title (B), number eleven (11) ofProclamation No. 2146, entitled "ProclaimingCertain Areas and Types of Projects asEnvironmentally Critical and Within the Scope ofthe Environmental Impact Statement (EIS) System

established under Presidential Decree No. 1586,"to ensure the protection of river systems, aquifersand mangrove vegetations from pollution andenvironmental degradation: Provided, further, Thatthe approval shall be in accordance with a set ofguidelines to be drawn up and promulgated by the

DAR and the BFAR: Provided, furthermore, Thatsmall-farmer cooperatives and organizations shallbe given preference in the award of the FishpondLease Agreement (FLAs).

"No conversion of more than five (5) hectares ofprivate lands to fishpond and prawn farms shall beallowed after the passage of this Act, except whenthe use of the land is more economically feasibleand sound for fishpond and/or prawn farm, ascertified by the Bureau of Fisheries and Aquatic

Resources (BFAR), and a simple and absolutemajority of the regular farm workers or tenantsagree to the conversion, the Department of

Agrarian Reform, may approve applications forchange in the use of the land: Provided, finally,That no piecemeal conversion to circumvent theprovisions of this Act shall be allowed.In thesecases where the change of use is approved, theprovisions of Section 32-A hereof on incentivesshall apply."

"Sec. 65-B. Inventory.Within one (1) year from

the effectivity of this Act, the BFAR shall undertakeand finish an inventory of all government andprivate fishponds and prawn farms, and undertakea program to promote the sustainable managementand utilization of prawn farms and fishponds.Nolease under Section 65-A hereof may be granteduntil after the completion of the said inventory.

"The sustainable management and utilization ofprawn farms and fishponds shall be in accordancewith the effluent standards, pollution charges andother pollution control measures such as, but not

limited to, the quantity of fertilizers, pesticides andother chemicals used, that may be established bythe Fertilizer and Pesticide Authority (FPA), theEnvironmental Management Bureau (EMB), andother appropriate government regulatory bodies,and existing regulations governing water utilization,primarily Presidential Decree No. 1067, entitled "ADecree Instituting A Water Code, Thereby Revisingand Consolidating the Laws Governing the
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R E P U B L I C A C T N O . 7 8 8 1 P a g e | 3Ownership, Appropriation, Utilization, Exploitation,Development, Conservation and Protection ofWater Resources."

"Sec. 65-C. Protection of Mangrove Areas. Inexisting Fishpond Lease Agreements (FLAs) and

those that will be issued after the effectivity of thisAct, a portion of the fishpond area fronting the sea,sufficient to protect the environment, shall beestablished as a buffer zone and be planted tospecified mangrove species to be determined inconsultation with the regional office of theDENR.The Secretary of Environment and NaturalResources shall provide the penalties for anyviolation of this undertaking as well as the rules forits implementation."

"Sec. 65-D. Change of Crops. The change of

crops to commercial crops or high value crops shallnot be considered as a conversion in the use ornature of the land. The change in crop should,however, not prejudice the rights of tenants orleaseholders should there be any and the consentof a simple and absolute majority of the affectedfarm workers, if any, shall first be obtained."

Sec. 6. There shall be incorporated after Section 73ofRepublic Act No. 6657a new section to read asfollows:

"Sec. 73-A. Exception.

The provisions of Section73, paragraph (E), to the contrary notwithstanding,the sale and/or transfer of agricultural land in caseswhere such sale, transfer or conveyance is madenecessary as a result of a bank's foreclosure of themortgaged land is hereby permitted."

Sec. 7. Separability Clause. If for any reason,any section or provision of this Act is declared nulland void, no other section provision or part thereofshall be affected and the same shall remain in fullforce and effect.

Sec. 8. Effectivity Clause. This Act shall takeeffect fifteen (15) days after its publication in atleast two (2) newspapers of general circulation.

Approved: February 20, 1995
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Republic Act No 7881