Include Selected CARP-Covered Lands in a Deed (Philippines): A Comprehensive Legal Guide (for information only; always consult qualified Philippine counsel for specific transactions)

1. Background and Legislative Framework

Law / Issuance	Key points on transferability & deeds
Republic Act No. 6657 (Comprehensive Agrarian Reform Law, 1988)	• Defines “CARP-covered lands.” • Sec. 27 bars sale, transfer or conveyance of awarded land within ten (10) years except to the government or the farmer-beneficiary’s heirs. • Sec. 24 creates the Emancipation Patent (EP) and / or Certificate of Land Ownership Award (CLOA) that must be annotated with these restrictions.
R.A. 7881 (1995), 8532 (1998) & 9700 (2009)	Extended funding, clarified retention, reaffirmed restrictions, introduced CARPER LAD forms and DAR “VLT/DPS” schemes.
DAR Administrative Orders (AOs)	• AO 1-1989 (land transfer clearance) • AO 1-2002 (land-use conversion) • AO 4-2009 (collective CLOA subdivision)—all routinely cited by Registries of Deeds (RODs).
LRA Circular No. 54-2014	Requires DAR Clearance or CERTIFICATION that land is not CARP-covered before any deed involving agricultural land can be registered.

2. Core Concepts

CARP-covered land – agricultural land in excess of the 5-ha retention limit of the landowner, or awarded to beneficiaries via EP/CLOA.
Selected portion – you may deed only part of the property if:
- the retained area (≤ 5 ha.) is being conveyed, or
- more than 10 years have lapsed from award and the beneficiary opts to sell, or
- the deed covers compulsory acquisition balance, VLT/DPS, or reclassification cleared by DAR.
Restrictive nature of title – CLOA/EP titles carry:
- a 10-year non-alienation clause;
- a lien in favour of the Land Bank for the amortization balance;
- an annotation that the land shall not be converted to non-agricultural use without DAR conversion approval.

3. When Can CARP Land Appear in a Deed?

Scenario	Allowed?	Requirements before notarizing & registration
Sale after 10 years from EP/CLOA award	✔	DAR Clearance (AO 1-1989); proof of full LBP amortization or assumption of balance; Municipal Agrarian Reform Office (MARO) certification that buyer is a qualified tiller.
Donation or succession to compulsory heirs	✔ (Sec. 27)	DAR Certification of heirship; waiver of tenancy rights by co-heirs if applicable.
Mortgage / Lease within 10 years	✖ (void)	Exception: production loans with LBP or government-accredited rural banks with DAR countersignature.
Sale to non-qualified party within 10 years	✖	Any deed is void ab initio; criminal liability under Sec. 74.
Inclusion of retained 5-ha. area in landowner’s deed	✔	DAR Certificate of Retention; approved subdivision plan (ASP) distinguishing retained vs. CARP-covered parcels.
Reclassification to residential / commercial	✔ if converted	DAR Conversion Order (AO 1-2002), HLURB/LGU zoning clearance; DENR clearance if forest/agro-forest.

4. Drafting the Deed: Mandatory Clauses & Best Practices

Title of Deed – e.g., “Deed of Absolute Sale Over Retained Agricultural Land (Not CARP-Covered)” to avoid Registry red-flags.
Recitals section should:
- cite the exact status of the land (CLOA No. ____, EP No. ____, Original TCT No. ____);
- state the legal basis for transfer (e.g., “more than ten (10) years have elapsed since the issuance of CLOA”).
Property description – always track the DENR-approved survey (PSD____) showing which selected portion is conveyed.
Conditions precedent & warranties clause:

“This transfer is subject to the provisions of Sec. 27, R.A. 6657; DAR Clearance No. ____ dated ___; and the buyer’s sworn undertaking that the land shall remain agricultural and shall be personally cultivated, save upon prior DAR conversion authority.”
Tax declarations & BIR clearances – BIR Form 1904 (for qualified farmer-beneficiary buyer), CARP-covered lands may qualify for DST or CGT exemptions if the transfer is mandated by DAR.
Consolidated attachments:
- DAR Clearance / Certification (original).
- Affidavit of Aggregate Landholding of buyer.
- MARO endorsement.
- Proof of payment / waiver of amortization.
- Approved subdivision plan if selling only a portion.

5. Step-by-Step Process to Register the Deed

Step	Office	Practical notes
1. Apply for DAR Land Transfer Clearance	DARPO/DARRO	Attach tax clearances, affidavit of aggregate landholding, and buyer’s ID. Processing time: 15-30 days.
2. Secure BIR CAR / eCAR	BIR RDO	DST & CGT may be conditionally exempt; still file to obtain electronic CAR.
3. Pay LGU Transfer Taxes	City/Municipal Treasurer	Some LGUs waive on CARP transfers; confirm ordinance.
4. Register Deed	Registry of Deeds	Present original DAR Clearance. ROD annotates Sec. 27 restrictions on new title.
5. Update Tax Declaration	Provincial/City Assessor	File new TD reflecting buyer; present new TCT/CLOA.

6. Selected Jurisprudence

Association of Small Landowners vs. DAR, G.R. 78742 (1989) – upheld constitutionality of compulsory acquisition and 5-ha. retention limit.
Natalia Realty v. DAR, G.R. 103302 (1993) – agricultural classification must exist as of 15 June 1988 to be CARP-covered.
Heirs of Malate v. Gamboa, G.R. 170139 (2014) – transfer of CLOA within 10-year prohibition is void; title may be reconveyed to DAR.
Heirs of Francisco v. DAR, G.R. 104554 (2001) – voluntary offer to sell (VOS) deeds must still respect Sec. 27 restrictions. These cases underscore that form (the deed) cannot cure absence of DAR authority or statutory qualifications.

7. Common Pitfalls

Overlooking collective CLOA subdivision – selling a “share” without DAR-approved partition is void.
Mislabelling retained and awarded areas – ROD will refuse registration without an Approved Survey Plan (ASP).
Assuming conversion because of zoning change – LGU rezoning alone never removes CARP coverage; DAR Conversion Order is indispensable.
Failure to update amortization status – unpaid LBP balance stays as lien; buyer inherits obligation or deed is registrably defective.

8. Practical Compliance Checklist

DAR Certificate of Retention (if seller is landowner conveying retained land).
DAR Land Transfer / Conveyance Clearance.
MARO Certification of buyer qualification.
Approved subdivision plan (if partial conveyance).
LBP amortization clearance or assumption agreement.
BIR eCAR & LGU transfer tax receipts.
Notarized Deed with agrarian-law clauses.
Registry of Deeds annotation of Sec. 27 and LBP lien on new title.

9. Sample Clause for Deed of Sale (illustrative)

“Subject to Agrarian Restrictions: Pursuant to Section 27 of R.A. 6657, the BUYER shall not sell, transfer or convey the land herein purchased within ten (10) years from the issuance of the original Certificate of Land Ownership Award No. ____, except to his/her legal heirs or to the Government. The land shall be devoted exclusively to agricultural use and personally cultivated by the BUYER unless a valid DAR Conversion Order is first obtained.”

10. Tax & Fee Snapshot (as of 2025)

Levy	Ordinary Sale	CARP-qualified transfer (Sec. 66, R.A. 6657)
Capital Gains Tax	6 % of higher of zonal value or consideration	Exempt if deed is in compliance with CARP transfer and buyer is a qualified beneficiary.
Documentary Stamp Tax	1.5 %	Exempt (see BIR Ruling DA-004-2008).
Transfer Tax (LGU)	≤ 0.75 %	Often waived by LGUs on CARP transfers but ordinances vary.
Registration Fee (ROD)	Graduated	Payable by transferee; discount if in favour of farmer-beneficiary.

11. Enforcement & Penalties

Void transactions – An alienation in violation of Sec. 27 is null and void; title may be cancelled and reconveyed to DAR.
Criminal liability – Up to 3 years’ imprisonment and / or fine ≤ ₱100,000 (Sec. 74).
Administrative sanctions – Disqualification of buyer from future CARP benefits; DAR may repossess and redistribute land.

12. Conclusion

Including selected CARP-covered lands in a deed is feasible only within the narrow corridors carved out by agrarian law: (a) after the statutory 10-year lock-in, (b) in favour of heirs, (c) for retained areas or lands duly reclassified/converted, or (d) upon DAR-facilitated schemes such as VLT or compulsory acquisition payments.

Every deed must therefore dovetail with (1) DAR clearances, (2) ROD annotation requirements, and (3) buyer-qualification rules. Failure at any link voids the conveyance—regardless of notarization—inviting civil rescission and criminal exposure.

For landowners, drafters, and beneficiaries alike, early coordination with DAR, LBP, and the Registry of Deeds remains the safest route to ensure that the deed you sign today is one the law will still recognize tomorrow.