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What’s the Difference Between Reclassification and Conversion of Land?

If you have a plot of land, what exactly do you plan to do with it? Depending on its classification and its current state, you might have some limitations on what you can do. For example, if it’s classified as agricultural land, you won’t be able to use it for commercial purposes. If you want to use it for non-agricultural purposes, you, as the owner, are required to file for a land use reclassification. But you would also have to undergo land conversion afterwards. But what are these terms? And what are the differences between the two? Here’s what you need to know.

What is Reclassification of Land?

Reclassification of land refers to the act of specifying how agricultural lands shall be utilized for non-agricultural purposes. These purposes can be residential, industrial, or commercial. 

According to RA No. 6657, or the Comprehensive Agrarian Reform Law of 1988, convertible lands can be reclassified through the local government unit or through a Presidential Proclamation.

However, land classification doesn’t automatically allow a landowner to use the land for non-agricultural purposes. 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. Therefore, in order for reclassified lands 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. (CREBA vs. The Secretary of Agrarian Reform, G.R. No. 183409,  June 18, 2010)

What is Conversion of Land?

Conversion of land is the process of changing the current physical use of a plot of agricultural land for non-agriculture purposes, or any other agricultural use that does not include cultivating soil, planting crops, growing trees, or harvesting any produce. The issuance of conversion orders are approved by the DAR.

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.

It should be noted, however, that not all agricultural land plots are eligible for land use conversion. A land is only eligible for conversion if:

  • It has been five (5) years from the Award of EP/CLOA;
  • The land has ceased to be economically feasible and sound for agricultural purposes, or the locality has become urbanized;
  • The land will have greater economic value for non-agricultural  purposes, such as residential, commercial, or industrial; and
  • The applicant for land conversion is either a beneficiary or landowner (for retained area only, which is tenanted).

What is the Process of Conversion of Land?

It’s a good idea to know the general procedure of land conversion before you begin converting your own parcel of agricultural land. Here is an overview of the process of land conversion, so that you know what to expect.

  1. Get an Application Form from the Land Use Cases Division (LUCD) or  Regional Land Use Cases Committee (RLUCC) of the Department of Agrarian Reform (DAR). You may also download the Sworn Application for Land Use Conversion (LUC Form 1) here https://media.dar.gov.ph/source/2018/08/02/notice-of-land-use-conversion-application-luc-form-no-1-to-luc-form-3.pdf
    • All applications for conversion and its supporting documents must be filed personally by the applicant who is the landowner or the duly authorized representative. 
    • A duly authorized representative is one who is empowered by the landowner to apply for conversion by virtue of a Special Power of Attorney (SPA) or a Board Resolution/Secretary Certificate, if the applicant is a juridical person. 
    • An application for conversion must be duly verified by the landowner or the duly authorized representative as to the truthfulness and correctness of all information contained therein. 
  2. Create a public notice billboard declaring that you plan to convert your land from agricultural to non-agricultural use. This billboard should be durable and should have a measurement of 4 feet by 8 feet. If your land exceeds twenty (20) hectares, you should display one (1) billboard per every twenty (20) hectares, which must all be easily visible. Besides your declaration, the billboard should have the following information:
    • Full names of the landowner(s), applicant(s) and developers;
    • The total area and location of the conversion;
    • Submission date of the conversion application;
    • Date of billboard posting;
    • Schedule for ocular inspection;
    • Deadline for submitting protests;
    • Contact information for the LUCD, RLUCC, and Provincial Agrarian Reform Office (PARO);
    • Address of the approving authority; and 
    • The application’s date of approval or rejection. However, this should be left blank until you, as the applicant, have received the decision of your application.
  3. Display the billboard. Take photos of it, the land, and any surrounding structures.
  4. The applicant must reproduce five (5) more copies of the Application Form and its supporting documents, which shall be placed in six (6) separate envelopes/folders. Of the six (6) folders, two (2) will be transmitted to the MARPO in advance containing the Electronic Copy of the OCT or TCT of the subject land as certified by the Register of Deeds, Tax Declaration and Directional Sketch Map. The remaining four (4) folders, including the original, will be submitted to RLUCC, containing the Application Form and all other requirements found under Section 10 of Administrative Order No. 01, series of 2002, as amended. 
  5. MARPO will send one (1) folder to the Provincial Agrarian Reform Program Officer (PARPO). MARPO would then check the coverage of the Comprehensive Agrarian Reform Program (CARP), the billboard, the presence of the farmers, and any post notices. If everything is clear, MARPO will then prepare the certification and send it back to you. If MARPO refuses to act, PARPO shall take over.
  6. File four (4) complete LUCFs, plus the MARPO certification, at the Regional Land Use Cases Committee (RLUCC).
    • RLUCC evaluates the completeness of LUCFs using LUC Form A. If the LUCF is complete, you are required to pay the assessed fees, inspection cost, and cash/surety bond. If it is incomplete, you are required to submit the missing requirement.
  7. RLUCC shall issue a notice indicating the date of On-Site Inspection and Investigation (OSII). You shall then write the OSII schedule on the billboard and forward the notice of conduct of OSII to the MARPO within five (5) days before OSII.
  8. The Land Use Conversion Division (LUCD)/Regional Land Use Cases Committee (RLUCC)  conducts the OSII. 
  9. The LUCD/RLUCC then deliberates on the application.
  10. Depending on the final decision, the Approving Authority shall issue either the Conversion Order or its denial within 30 days from RLUCC’s submission of recommendation.

DOCUMENTARY REQUIREMENTS: 

  1. Official receipt showing proof of payment of filing fee and inspection cost.
  2. Official receipt showing proof of posting of bond or an original copy of the GSIS surety bond to guarantee against premature conversion:
    • Upon filing of the application, the applicant shall post a cash bond equivalent to at least 2.5% of the zonal value of the land per latest issuance of the DOF, in the form of cash or manager’s check posted in favor of the DAR. 
    • In lieu of the cash bond, the applicant may post a surety bond, issued by the GSIS, equivalent to at least 15% of the total zonal value of the land.
  3. Sworn Application for Land Use Conversion (Form No. 1); 
  4. Electronic Copy of OCT or TCT of the subject land issued by the Register of Deeds 
  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, if applicable; 
  6. True copy of the current Tax Declaration covering the subject property; 
  7. Project feasibility study; 
  8. Joint venture agreement or any other business arrangement on the use of land between the landowner and the developer (if the developer is other than the landowner) or between the Emancipation Patent/Certificate of Land Ownership Award (EP/CLOA) holders and the developer (if the land was awarded under the agrarian reform program);
  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. Proof of financial and organizational capacity of the developer to develop land, incuding the following information:
    • Statement of project cost and availability of potential funding source/s for the development of the proposed project;
    • Profile of the developer;
    • Most recent financial statement, not later than the year before application, duly authenticated by a CPA; and 
    • 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 SEC, or in lieu of the latter, a duly accomplished GIS sworn to before a Notary Public;
    • Socio-Economic Benefit Cost Study of the proposed project; 
  11. 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:
    • 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; 
    • At least one (1) photograph per corner, taken from each corner of the landholding’s borders;
    • At least two (2) photographs each for all distinct man-made structures existing on the land, taken from opposite angles; 
    • At least two (2) photographs each of the front view of the billboard/s. The applicant shall set aside the second copy of said billboard photo for submission to the MARPO; and 
    • 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.
  12. Affidavit of Undertaking (LUC Form No. 2);
  13. MARO Certification (LUC Form No. 3) and Notice of Land Use Conversion in English Language (LUC Form No. 4) and in local dialect (LUC Form No. 4A);
  14. Certificate of Reclassification by the Department of Human Settlements and Urban Development (DHSUD), in case the landholding is situated in Highly-Urbanized or Independent Component Cities;
  15. In case of landholdings situated in Component Cities and Municipalities, the Sangguniang Bayan/Panlungsod Zoning Ordinance and the Sangguniang Panlalawigan Resolution approving said Zoning Ordinance shall be required;
  16. Certification from the authorized DENR official stating, among others, whether the subject land is within the NIPAS, mossy and virgin forests, riverbanks, or swamp and marshlands; within an ECA; or will involve the establishment of an ECP;
  17. If applicable, Special Power of Attorney when the applicant is not the registered owner
  18. If applicable, notarized Secretary’s Certificate of a corporate/cooperative board resolution authorizing the representative, when the applicant is a corporation or cooperative; 
  19. 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; 
  20. If applicable, endorsement from the concerned government agency, when the application involves a priority development area or project;
  21. If applicable, Land Bank of the Philippines (LBP) Certification attesting that the applicant-landowner has fully paid his obligations to the LBP, when the application land-owner is a beneficiary of the agrarian reform program (LUC Form No. 8); 
  22. If applicable, Provincial Agrarian Reform Office (PARO) Certification attesting that the application-landowner acquired the subject land from a landed-estate or under the Voluntary Land Transfer/Direct Payment Scheme and he has already fully paid his obligation thereunder, when the applicant-landowner is a beneficiary of the agrarian reform program (LUC Form No. 9); 
  23. 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 for conversion if the application covers less than the total lot area; 
  24. 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) km radius and owners of adjacent properties; 
  25. Map of the development plan. For socialized housing projects, the applicant shall submit map of the development plan with marked “reviewed by the HLURB.”
  26. Topographic Map if the subject property is within an upland, hilly, or mountainous area.

WHERE TO FILE THE APPLICATION?

  1. For applications involving lands with an area less than or equal to five (5) hectares, the same must be filed before the RLUCC located at the DAR Regional Office and the approving authority therefor is the Regional Director; and
  2. For applications involving lands with an area larger than five (5) hectares, the same shall be filed before the LUCD located at the DAR Central Office, and the Secretary shall be the approving authority therefor who may delegate the same authority to any Undersecretary. 

Other requirements and processes may be found here: 

  1. DAR Administrative Order No. 01, series of 2002 https://media.dar.gov.ph/source/2018/09/06/ao-2002-01.pdf
  2. DAR Administrative Order No. 01, series of 2019 https://media.dar.gov.ph/source/2019/05/17/ao-01-streamlining-the-processing-of-applications-for-land-use-conversion-under-dar-administrative-order-no-1-series-of-2002-1.pdf
  3. DAR Memorandum Circular No.02, series of 2002 https://media.dar.gov.ph/source/2018/08/02/notice-of-land-use-conversion-application-luc-form-no-1-to-luc-form-3.pdf

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