Longer lease terms seen to enhance investment stability and job creation

A revision to the Investors’ Lease Act—Republic Act No. 12252—extends the maximum term for foreign investors to lease private land in the Philippines from the previous 75 years (50 years plus a 25-year renewal) to up to 99 years. President Ferdinand R. Marcos Jr. signed the law on September 3, with formal announcement following shortly thereafter.

The law seeks to foster stronger investment and employment in strategic sectors such as industrial estates, agro-industrial projects, tourism, ecological conservation, and processing facilities. Qualifying investors must be registered under measures including the Foreign Investments Act and the CREATE and CREATE MORE Acts.

Frederick Go, Special Assistant to the President for Investment and Economic Affairs, described the law as “a catalyst for agriculture, industrialization, technology transfer, and investment-led growth.” He noted that the previous short-term lease terms deterred long-gestation projects and limited the Philippines’ competitiveness in the region.

Industry stakeholders echoed the sentiment. The Philippine Economic Zone Authority (PEZA) said the extended lease term aligns the country with regional peers and provides stability for capital-intensive investments in sectors like manufacturing, logistics, tourism, and IT-enabled services.

Under the amended law, lease contracts must be registered with the local Registry of Deeds and recorded on the property’s title. The legislation also empowers oversight bodies—such as the Fiscal Incentives Review Board or relevant investment promotion agencies—to monitor compliance and penalize delays or misuse. Penalties range from %u20B11 million to %u20B110 million and include possible imprisonment for violations.