President Ferdinand “Bongbong” Marcos Jr. has signed Republic Act (RA) 12252, amending the Investors’ Lease Act (RA 7652) to allow foreign investors to lease private lands in the Philippines for up to 99 years.
The previous law only permitted long-term leases of up to 50 years, renewable once for an additional 25 years.
RA 12252, signed on September 3, gives the President the power to impose shorter lease periods on investors engaged in vital services or industries classified as critical infrastructure, in the interest of national security and development.
Foreign investors must hold an approved investment and comply with regulations from the concerned investment promotion agency. The law warns: “Withdrawal of the approved and registered investment in the Philippines within the period of the lease contract entered into under this Act, or use of the leased area for the purpose other than that authorized, shall warrant the ipso facto termination of the lease contract without prejudice to the right of the lessor to be compensated for the damages the lessor may have suffered thereby.”
For tourism-related projects, land leases are limited to ventures with an investment of at least $5 million, with 70% of the capital infused within three years from signing the lease contract. Failure to begin the project within the same period may also result in contract termination.
The law also clarifies that foreigners, associations, or partnerships “not investing in the Philippines” remain subject to Presidential Decree No. 471 and other existing laws. These entities can only lease private lands for a maximum of 25 years, renewable once for another 25 years.