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Property ownership for corporations (Third of six part series)

What are the rights and restrictions of private corporations or associations organized under the Philippine laws in acquiring and owning real property in the Philippines? Private Corporations or associations organized under the laws of the Philippines 60% of the capital of which is owned by Filipinos are entitled to acquire and own private lands in the Philippines. They may also hold alienable agricultural lands of the public domain only by lease for a period not to exceed 25 years renewable for not more than 25 years and not to exceed 1,000 hectares. Property Ownership of Foreign nationals and corporations Basic rule for foreign nationals or corporations is that it should form a Philippine corporation and the corporation should be 40% foreign-owned (maximum) and 60% Filipino-owned (minimum), and should at least have five [5] incorporators. Foreign nationals or corporations however may acquire and completely own a condominium unit. A foreign national and or corporation may enter into a lease agreement with Filipino landowners for an initial period of up to 50 years, and renewable for another 25 years. Ownership for foreigners of a private land/s, residential housing unit and lot, and commercial building and lot will require a  40% foreign-owned corporation for foreigners (maximum) and 60% Filipino-owned (minimum), and with at least five [5] incorporators. For both local and foreign corporations, such rights to own or hold lands are subject to the following legal restrictions: • Zoning Law – delineation of the particular uses of lands • Subdivision Regulations – required for subdivision projects like open space requirement, development specification and completion period • Building Code – regulations pertaining to height, setback, material specification etc. • Power of Eminent Domain of the State – the power of the State to take private property for public use upon payment of just compensation • Escheat -the reversion of the property to the State due to the intestate death (without will) of the owner without any heir • Taxation – the power of the State to impose and collect tax and other charges on the real estate. It is also subject to the following voluntary or contractual restrictions: • Lease Contract – the temporary surrender of the rights to possess, use and enjoy in favor of another person who pays rent • Right of Way Easement – the right given to an owner of an adjoining land to pass or have access thru another land • Usufruct – transfer to another person of the right to enjoy the fruits of the property. Use Restrictions in Subdivision contracts. Source: Andy Manalac: National Real Estate Association Chairman NEXT ISSUE: Property Relations Between Husband and Wife
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