1) Why corporate land ownership is a constitutional question

In the Philippines, rules on who may own land are not merely statutory—they are constitutional. The 1987 Constitution reserves ownership of private lands to:

Filipino citizens, and
Corporations/associations at least 60% Filipino-owned (often called “Philippine nationals” in practice, though that term is also used in investment regulation).

As a result, corporate land acquisition routinely requires nationality compliance, careful structuring, and clean registration under the Torrens system.

A practical way to understand the framework is to separate:

Land classification (public domain vs private land),
Who is qualified to own (corporate nationality rules), and
How ownership becomes legally effective (land registration and conveyancing).

2) Land classification that drives corporate rights

A. Lands of the public domain (State-owned unless properly alienated)

The Constitution classifies lands of the public domain into categories such as agricultural, forest/timber, mineral lands, and national parks. Only agricultural lands may generally be declared alienable and disposable (A&D) and later titled into private ownership through patents or judicial confirmation.

Key corporate consequence: Private corporations or associations may not acquire lands of the public domain by purchase or grant. Their constitutional route is generally lease, subject to limits (commonly stated maximum of 1,000 hectares, typically up to 25 years renewable for another 25 for public domain leases, depending on implementing laws and terms).

B. Private lands (already alienated from the public domain)

Once land becomes private (e.g., titled under Torrens as an OCT/TCT, or otherwise proven private), the constitutional restriction shifts to who may own: Filipino individuals and qualified Philippine corporations.

3) Who is qualified to own private land (corporate side)

A. Domestic corporations that may own land

A corporation may own private land if it is organized under Philippine law and at least 60% of its outstanding capital (commonly voting equity) is owned by Filipinos.

In practice, qualification hinges on nationality—not merely place of incorporation. A Philippine-incorporated company that falls below the required Filipino ownership is treated as disqualified from owning land.

B. How “60% Filipino-owned” is tested (control vs beneficial ownership)

Two concepts routinely appear in compliance:

Control test (common starting point): looks at whether Filipinos own at least 60% of voting/control shares.
Grandfather rule (applied in some contexts when there is doubt or layering): traces beneficial ownership through corporate layers to determine ultimate Filipino ownership.

Although the most intensive nationality analysis is famously litigated in natural resources and other nationalized activities, landholding transactions also regularly require conservative documentation—especially where ownership layers are complex or where foreign investors are present.

C. The Anti-Dummy Law risk (and why form-only compliance can fail)

Using Filipino “dummies” to circumvent land restrictions is legally dangerous. The Anti-Dummy Law penalizes schemes where foreigners effectively control or beneficially own what the Constitution reserves to Filipinos. Beyond criminal exposure, contracts designed to defeat constitutional restrictions can be declared void, with severe consequences for recovery of payments and property.

D. Foreign corporations and foreign nationals

As a general rule:

Foreign corporations cannot own Philippine land.
Foreign individuals cannot own Philippine land, subject to very narrow exceptions (notably legal succession in certain cases, and special regimes for former natural-born Filipinos).

Foreign participation is therefore usually structured through leases, condominium unit ownership within limits, and/or ownership of improvements (buildings) separate from land.

4) Common lawful structures for foreign participation without land ownership

A. Long-term lease of land

Foreign investors commonly obtain economic use via leasing rather than owning.

Under general civil law principles, leases are permissible.
Special legislation for foreign investors supports long-term leases (commonly discussed as up to 50 years, renewable for 25 more for qualifying investments), subject to statutory conditions and registration requirements.

A lease does not transfer ownership, but it can be structured with:

escalation clauses,
renewal options,
mortgageability of leasehold interests (subject to law and lender requirements),
assignment/sublease controls.

Registration matters: a lease that must be binding on third persons should be registered/annotated on the title when registrable.

B. Condominium units

Foreigners may generally acquire condominium units (not land) provided the foreign ownership in the condominium project does not exceed 40%. The land is typically owned by a condominium corporation, and the foreign ownership cap protects constitutional compliance.

C. Ownership of buildings/improvements separate from land

The civil law concept that buildings and improvements may be owned separately from land (depending on the legal instrument and registration/annotation) allows foreign investors to hold economic interests without owning land. Care is needed to avoid structures that functionally mimic prohibited land ownership.

5) Corporate acquisition and disposition of land: internal approvals and authority

A. Corporate authority to buy or sell land

Land transactions must be executed by duly authorized corporate officers/agents. As a practical baseline:

Board authority (board resolution) is typically required for acquisition/disposition.
If the deal involves substantially all assets, stricter corporate approvals may apply under corporate law (e.g., stockholder approval thresholds and notice requirements).

Common documents requested in practice:

Board Resolution approving the transaction and authorizing signatory
Secretary’s Certificate attesting to board action and quorum
Latest General Information Sheet (GIS)
SEC registration documents
Proof of authority of signatory (incumbency, IDs, notarized SPA when applicable)
For nationality-sensitive deals: ownership structure declarations and supporting records

B. Land used as capital contribution or transferred via mergers/restructuring

Land can be:

contributed as property-for-shares (subscription),
transferred in mergers/consolidations,
moved in corporate reorganizations.

Even when tax rules allow certain deferrals, registration (and nationality compliance) remains essential, and regulators may scrutinize transactions that appear designed to park land in disqualified entities.

C. Banks and other regulated entities acquiring land

Banks may acquire land in limited cases (e.g., foreclosure) but are typically required to dispose of foreclosed real property within statutory periods, subject to conditions and regulatory oversight. Similar limits can apply to other regulated institutions.

6) Substantive restrictions that frequently affect corporate landholdings

A. Agrarian reform (CARP) exposure

Agricultural land is subject to agrarian reform laws. Corporate landowners face issues such as:

Whether the land is covered by agrarian reform,
Whether it is subject to distribution to beneficiaries,
Requirements for conversion to non-agricultural use,
DAR clearances/annotations and practical constraints on transfer.

Transactions involving agricultural land often require:

checking DAR coverage status,
verifying emancipation patents/CLOAs in the area,
confirming land use conversion approvals when relevant.

B. Ancestral domains and Indigenous Peoples’ rights (IPRA)

Certain areas may be within or affected by ancestral domain claims. Corporate due diligence must include:

checking for ancestral domain titles/claims,
Free and Prior Informed Consent (FPIC) requirements in applicable projects,
overlap analysis.

C. Zoning, land use, environmental and easement constraints

Ownership does not equal unrestricted use. Land can be burdened by:

zoning classifications and local land use plans,
building and environmental permits,
protected area restrictions,
legal easements (e.g., along riverbanks, shorelines, road easements),
restrictions on foreshore and reclaimed lands (often subject to special rules, concessions, or public domain constraints).

D. Constitutional and jurisprudential consequences of disqualification

A corporation that is not qualified cannot validly acquire land. Depending on the facts and how the deal is structured, potential consequences include:

void or voidable transactions,
cancellation or refusal of registration,
forfeiture/cheat-like outcomes in extreme cases,
restitution problems (recovering payments can be complex where illegality is involved).

7) The Land Registration system: the Torrens framework

A. What “Torrens title” does (and does not) do

Philippine land registration is built around the Torrens system, primarily governed by Presidential Decree No. 1529 (Property Registration Decree).

A Torrens title is designed to provide:

a reliable, government-backed record of ownership,
a system of registration of interests (mortgages, liens, easements, leases),
protection of innocent purchasers who rely on the face of the title (with recognized exceptions).

But Torrens title is not magic:

It does not legitimize land that was never legally alienable/disposable.
It does not always protect buyers who ignore red flags (e.g., obvious defects, suspicious circumstances).
It can be challenged in specific actions (e.g., reconveyance, annulment in cases of fraud within allowable periods, or when title is void for fundamental reasons).

B. Key institutions

Land Registration Authority (LRA): policy/administrative oversight; issues decrees in original registration and coordinates registries.
Registry of Deeds (RD): records and registers titles and instruments; issues Transfer Certificates of Title (TCTs) and Condominium Certificates of Title (CCTs).
Related agencies often implicated in titling: DENR (land classification, surveys, patents), DAR (agrarian matters), LGUs (tax declarations, zoning), and courts (judicial registration and disputes).

C. Types of certificates

OCT (Original Certificate of Title): first title issued for land under the Torrens system.
TCT (Transfer Certificate of Title): issued upon transfer of an OCT/TCT to a new owner.
CCT: title for condominium units.

8) How land becomes titled: original registration and administrative titling pathways

A. Judicial confirmation / original registration under PD 1529

A claimant files a petition for original registration with the proper court, supported by:

proof of ownership or registrable rights,
survey plan and technical description,
evidence of possession and/or legal basis,
notices/publication requirements.

Oppositions may be filed by the State, neighbors, or other claimants.

B. Administrative titling through patents (Public Land Act and amendments)

For A&D public agricultural lands, the State may issue patents (e.g., free patent, homestead patent, sales patent), which are then registered, leading to an OCT.

Modern reforms have aimed to simplify titling, reduce documentary burdens, and extend filing periods for certain administrative/judicial confirmation processes. Corporate relevance: corporations generally do not obtain public land patents as buyers/grantees; their route is typically acquiring already-private/titled land from qualified owners (or leasing public land where allowed).

C. Cadastral proceedings

Government-initiated cadastral surveys and proceedings can result in titling across an area. Corporate due diligence should check cadastral context because boundary issues and overlapping claims sometimes surface during or after cadastral activity.

9) Corporate conveyancing: from contract to a new TCT

A sale of land is not fully effective against third persons until properly registered. A typical end-to-end transfer (private land, already titled) looks like this:

Step 1: Title and land due diligence

For corporate buyers, this is non-negotiable:

Secure a certified true copy of the title from the RD.
Check for encumbrances: mortgages, liens, adverse claims, lis pendens, easements, restrictions.
Verify identity of the registered owner and authority of signatories.
Check technical description vs actual boundaries; confirm survey and improvements.
Confirm tax status (real property taxes, assessment records).
Check DAR status for agricultural land (coverage, conversion orders, CLOAs nearby).
Check DENR classification (A&D status when relevant, especially for lands with shaky provenance).
Consider zoning/use limitations and permitting constraints.
For corporate nationality: confirm buyer is qualified to own land (60% Filipino rule, layering, beneficial owners).

Step 2: Contracting

Common instruments:

Deed of Absolute Sale
Conditional Sale / Contract to Sell (with staged payments)
Deed of Assignment (if rights are being assigned)
Deed of Donation (less common for corporate buyers)

The deed must be properly executed, typically notarized.

Step 3: Tax clearances and payments

Philippine transfers commonly require:

BIR requirements culminating in an eCAR (electronic Certificate Authorizing Registration) or equivalent clearance allowing registration.
Taxes may include:
- Capital Gains Tax (CGT) on sale of real property treated as a capital asset (rules differ depending on whether the seller is an individual or corporation and whether the property is a capital or ordinary asset),
- Documentary Stamp Tax (DST),
- Local transfer tax (rate varies by locality),
- Real property tax clearance and other LGU requirements.

Tax characterization is crucial in corporate deals:

A corporation selling land that is an ordinary asset is generally treated differently (subject to regular income tax rules and creditable withholding tax) than a capital asset sale (often subject to final tax rules). Correct classification depends on facts (use in business, inventory, holding purpose, etc.).

Step 4: Registration with the Registry of Deeds

Submission typically includes:

notarized deed,
owner’s duplicate title,
tax clearances/eCAR,
transfer tax receipt,
corporate documents (board resolution, secretary’s certificate, IDs, etc.),
other required clearances depending on land type (DAR, DENR, etc.).

Upon registration, RD cancels the old title and issues a new TCT in the buyer’s name (or annotates the relevant encumbrance if it’s a mortgage/lease).

Step 5: Post-registration updates

Update the Tax Declaration with the City/Municipal Assessor.
Ensure real property tax records reflect the new owner.
For corporate asset management: update fixed asset registers, insurance, and compliance records.

10) Registration of corporate security interests and property arrangements

Corporations frequently use land for financing and project development. Common registrable interests include:

Real estate mortgage: must be registered/annotated to bind third parties and establish priority.
Leases (long-term or those required by law to be registrable): annotation protects the leasehold against subsequent purchasers.
Easements / rights of way: registration strengthens enforceability and notice.
Adverse claim: a temporary protective annotation used to warn third persons of a claimed interest (time-limited and procedural).
Lis pendens: annotation of pending litigation affecting the property.
Restrictions/conditions: e.g., subdivision restrictions, easements, and special annotations.

Priority generally follows time of registration, not time of signing—another reason corporate transactions insist on prompt registration.

11) Corporate compliance pitfalls (and how disputes typically arise)

A. Nationality defects and “later cure” misunderstandings

A common misconception is that a land acquisition defect can be cured merely by later restructuring. In many cases, capacity to acquire must exist at the time of acquisition. A disqualified buyer may face voidness issues that are difficult to unwind cleanly.

B. Dummy arrangements and side agreements

Side agreements giving foreigners control or beneficial ownership can be fatal. Courts scrutinize substance over form, and illegality can block equitable recovery.

C. Fake titles, double sales, and chain-of-title problems

Even with Torrens, fraud exists. Corporate buyers typically protect themselves by:

verifying RD records,
checking LRA verification systems where available,
reviewing mother titles for subdivided properties,
confirming authentic survey and technical descriptions,
requiring warranties/indemnities and escrow arrangements.

Double sales and overlapping claims often turn on:

who registered first,
who possessed,
good faith and notice,
authenticity of documents.

D. Agrarian issues as deal-breakers

Undisclosed agrarian coverage can derail development plans. Due diligence must go beyond the title face; agrarian restrictions may not always be obvious without agency checks.

E. Boundary and survey disputes

A clean TCT does not always mean the boundary on the ground matches the paper. Encroachments, overlapping surveys, and inconsistent technical descriptions are frequent in practice.

12) Litigation and remedies in land and registration controversies (high-level)

Common actions affecting corporate land include:

Quieting of title (remove cloud/uncertainty)
Reconveyance (recover property wrongfully registered in another’s name)
Annulment of title / cancellation of title (when title is void or procured by fraud under specific rules)
Reformation of instrument (fix document to reflect true intent, when legally permissible)
Ejectment / accion publiciana / accion reivindicatoria (possession vs ownership disputes)
Reconstitution of title (when titles are lost/destroyed, with strict requirements)
Injunction and provisional remedies to prevent disposal during litigation

Because land registration creates strong presumptions, corporate plaintiffs/defendants focus heavily on:

validity of the underlying acquisition,
presence of fraud and the timeliness of actions,
good faith purchaser defenses,
jurisdictional/notice defects in original registration,
whether land was actually alienable and disposable when titled.

13) A practical corporate checklist (Philippine context)

Before signing

Confirm buyer qualification (60% Filipino ownership; layered ownership clarity).
Confirm seller authority (board approvals; incumbency; no adverse corporate restrictions).
Obtain certified true copy of title; check encumbrances.
Validate identity and chain of title (mother title where relevant).
Check taxes, zoning, DAR coverage, DENR classification as needed.
Physical inspection + survey verification when material.

Before registration

Correct deed formalities; notarization.
Complete BIR and LGU tax requirements; obtain eCAR.
Ensure all corporate documents are complete and consistent with SEC filings.

After registration

Secure new TCT and verify annotations.
Update tax declaration and RPT records.
Register mortgages/leases/easements promptly if part of the deal.
Monitor compliance with any restrictive covenants or development conditions.

14) Key takeaways

Corporate land ownership in the Philippines is shaped by three pillars:

Constitutional qualification (Filipino citizens and 60%-Filipino-owned Philippine corporations for private land; corporations generally cannot acquire public domain lands except via lease),
Substantive regulatory overlays (agrarian reform, ancestral domain, zoning, environmental and easement rules), and
The Torrens registration system (PD 1529), where registration is central to enforceability, priority, and transactional security.

The legal and practical center of gravity is not only “Can the corporation buy?” but also “Is the corporation qualified and can it register cleanly, tax-cleared, and development-ready under Philippine regulatory conditions?”