Short answer: No. Carnapping is a public offense under a special penal law. Private settlement—like paying the owner, returning the vehicle, or securing an “affidavit of desistance”—does not automatically dismiss the criminal case. It may affect the civil aspect and, in practice, can influence prosecutorial discretion or evidentiary sufficiency, but the crime itself is an offense against the State and proceeds unless a lawful ground for dismissal exists.

Below is a practical, end-to-end guide.

1) The Law at a Glance

Governing statute: Republic Act No. 10883 (New Anti-Carnapping Act of 2016), which superseded R.A. 6539.
Basic elements: Taking, without the owner’s consent, of a motor vehicle with intent to gain.
Penalties (overview): Severe imprisonment ranges, with higher penalties if committed with violence, intimidation, or force upon things, and the gravest penalties where serious felonies (e.g., homicide) occur during or on the occasion of carnapping.
Nature of the offense: Public crime. Prosecution is in the name of the People of the Philippines. It does not require a private complaint to commence and is not subject to private compromise.

2) Why “Settlement” Doesn’t Automatically End the Case

2.1 Crimes vs. Civil Liability

Under Philippine law, the criminal liability for public offenses cannot be compromised by private agreement.
What can be settled is the civil liability (e.g., restitution of the vehicle, payment of damages, expenses, loss of use). A victim may waive or reduce civil claims, but the State’s criminal action is separate and remains.

2.2 Affidavit of Desistance

An “affidavit of desistance,” “affidavit of non-interest,” or “quitclaim” from the owner does not bind the prosecutor or the court.
Prosecutors and judges assess probable cause and evidence, not the parties’ private wishes. Desistance is, at best, a piece of evidence that may weaken the prosecution if the private complainant is the sole witness and refuses to cooperate. Even then, dismissal is not automatic.

2.3 Not Covered by Barangay Settlement

Matters subject to the Katarungang Pambarangay are limited (punishable by ≤ 1 year or ≤ ₱5,000 fine, among other requirements). Carnapping carries far heavier penalties and is therefore not subject to barangay mediation/settlement.

3) When Can a Carnapping Case Actually Be Dismissed?

A court (or prosecutor during preliminary investigation) may dismiss the case only on lawful grounds, for example:

No probable cause (e.g., elements are not supported; identification of the accused is unreliable; the taking lacked intent to gain; the vehicle was not a “motor vehicle” under the law; or the accused had valid authority/consent).
Constitutional or procedural violations (e.g., illegal arrest without waiver, unlawful search/invalid seizure, coerced confession, breach of custodial or speedy-trial rights).
Evidentiary failure (e.g., after trial, the prosecution’s evidence does not establish guilt beyond reasonable doubt; or a demurrer to evidence is granted).
Prosecutor’s motion to withdraw information (e.g., after reevaluation of the evidence), subject to judicial approval.
Other recognized modes of extinguishment of criminal liability (e.g., amnesty, absolute pardon, death of the accused, prescription—subject to the statute’s prescriptive periods).

Key point: Private settlement is not on this list. If dismissal happens after a “settlement,” it is because the evidence has become insufficient (for instance, the complainant refuses to testify and there is no other admissible proof), or because the prosecutor independently found no probable cause—not because the parties agreed to drop the case.

4) Practical Effects of Settlement (What It Can Do)

Restitution: Returning the vehicle and paying damages resolves, in whole or in part, the civil aspect.
Plea for leniency: While settlement doesn’t erase criminal liability, it may persuade the prosecutor to consider plea bargaining to a lesser offense (if warranted by the facts) or the court to consider mitigating circumstances (e.g., voluntary surrender, plea of guilty).
Insurance/Subrogation: If an insurer paid the owner, the insurer may be subrogated to the owner’s civil claims. Settlement with one party must be structured carefully to avoid disputes with subrogated parties.
Juveniles in conflict with the law: For a child in conflict with the law, diversion/suspended sentence under the Juvenile Justice and Welfare Act may apply depending on the penalty and circumstances—this is a statutory route distinct from “settlement.”

5) Stages of the Case—and Where Settlement Sometimes Shows Up

5.1 Before Filing in Court (Preliminary Investigation)

The complainant may “settle” and submit an affidavit of desistance. The prosecutor can still find probable cause and file an Information if the evidence independently supports it.
Conversely, if the complainant refuses to cooperate and there is little else (no CCTV, plate/engine/chassis linking, recovery records, eyewitnesses, or admissions), the prosecutor may dismiss for lack of probable cause. That outcome is evidence-driven—not settlement-driven.

5.2 After Filing in Court (Post-Filing)

The case is under judicial control. The prosecutor may move to withdraw the Information if reevaluation shows evidentiary weakness, but the court must approve.
The private offended party has no unilateral power to drop the case. Any “settlement” submitted to the court is, at most, persuasive as to the civil aspect and the complainant’s willingness (or lack thereof) to testify.

6) Plea Bargaining and Charge Re-Assessment

Plea bargaining is permitted in criminal cases with court approval and the prosecutor’s consent.
If the facts do not fully meet carnapping’s elements (e.g., the initial possession was with consent under a financing scheme and the dispute is essentially civil; or the evidence supports only theft under the Revised Penal Code), the Information may be amended or the accused may be allowed to plead to a lesser, included offense.
This is not “settlement-based dismissal.” It is a legal calibration of charges based on evidence and law.
Probation: Penalties for carnapping generally exceed the probationable threshold. Probation becomes plausible only if there is a plea to a significantly lesser offense carrying a probationable penalty and the accused is otherwise qualified.

7) Civil Compromise: Structuring It Safely

If parties pursue a civil compromise alongside the criminal case:

Keep it clearly civil: State that the agreement settles civil claims (restitution, loss of use, repairs, towing/storage, attorney’s fees, etc.) and does not compel the prosecutor/court to dismiss the criminal case.
Avoid illegal considerations: Do not condition payment on the complainant’s refusal to appear or the giving of false testimony. That risks obstruction of justice or compounding of a felony.
Address third-party rights: Note any insurer or financing company, and obtain their conformity if they have subrogated or independent claims.
Document turnover: For recovered vehicles, coordinate proper turnover, inspection, inventory, and chain-of-custody of identifiers (VIN/engine/chassis numbers, plates) to prevent later disputes.

8) Special Situations Frequently Confused with Carnapping

Loan/financing defaults and repossessions: Mere non-payment of a car loan or failure to return a vehicle is not automatically carnapping if the initial possession was with consent. The correct remedy may be civil (e.g., replevin, rescission, damages) unless subsequent acts meet carnapping’s elements (e.g., taking from the owner’s lawful possession without consent, with intent to gain).
“Borrowed” vehicles not returned: Failure to return can be estafa or theft depending on circumstances. Prosecutors examine the mode of acquisition (consensual vs. non-consensual), intent, and conversion.

9) Strategy Notes for Each Side

If You’re the Accused

Don’t rely on settlement to end the case. Focus on legal defenses: lack of intent to gain, consent/authority to possess, misidentification, absence of “motor vehicle” element, inadmissible seizure, or chain-of-custody defects.
Gather independent evidence: GPS logs, dashcam/CCTV, repair invoices, toll/RFID records, phone geolocation metadata (subject to lawful acquisition), witness statements proving consent or alibi.
Consider calibrated outcomes: Explore plea bargaining if evidence is strong; aim to reduce to a lesser offense that fits the facts.
Mind statements: Settlement documents can admit facts. Have counsel vet wording to avoid self-incrimination.

If You’re the Vehicle Owner/Insurer

Cooperate with lawful process: Turn over keys, duplicate keys, CR/OR copies, photos, VIN/engine/chassis data, tracker data.
Civil recovery: Even if the prosecutor continues the case despite settlement, you may fully waive or limit civil claims through compromise if that serves your interests.
Avoid illegal quid pro quo: Don’t agree to stay away from court or to submit false statements in exchange for payment.

10) Key Takeaways

Settlement ≠ Dismissal. A carnapping case does not vanish because the parties settled.
Civil vs. Criminal: Settlement can extinguish or reduce civil liability, but the criminal action persists unless legal grounds justify dismissal.
Desistance is not decisive. It may affect proof, not policy.
Charge calibration is lawful; buying a dismissal is not. Plea bargaining or amendment of the Information depends on evidence, law, and court/prosecutor approval.
Get counsel early. Early legal strategy—during PI and immediately after filing—often determines whether a case is dismissed for lack of cause or proceeds to trial.

Final Word

If your goal is to resolve the civil consequences (return of vehicle, damages) while protecting your rights in the criminal case, a carefully drafted civil compromise may be appropriate—but it must be paired with a sound legal defense or a properly negotiated plea. The path to dismissal lies in law and evidence, not in settlement alone.