• Foreigners barred from owning property in PH

    6
    Persida Acosta

    Persida Acosta

    Dear PAO,
    My sister married a foreigner. After a year of marriage, they acquired a house and lot in Santa Cruz, Ilocos Sur. Their relationship turned sour because of cultural differences. Her husband claimed that he is the sole owner of the property, since it was his money that was used to purchase the property. My sister discovered that he is negotiating the sale of their property. Suppose the property would be sold, what are the rights of my sister?                    
    Irlinda

    Dear Irlinda,
    The stand of your brother-in-law that he is the sole owner of the property in Ilocos Sur, because it was his money that was used to buy their property, has no legal basis. In fact, since he is a foreigner, he is prohibited from owning property here in the Philippines. This finds support under Section 7, Article XII of the 1987 Philippine Constitution which states: “Save in cases of hereditary succession, no private lands shall be transferred or conveyed except to individuals, corporations or associations qualified to acquire or hold lands of the public domain.”

    In Matthews vs. Taylor et al. (G.R. No. 164584, June 22, 2009), the Supreme Court has explained the rationale behind the constitutional prohibition:

    In Krivenko v. Register of Deeds, cited in Muller v. Muller, we had the occasion to explain the constitutional prohibition:

    Under Section 1 of Article XIII of the Constitution, natural resources, with the exception of public agricultural land, shall not be alienated, and with respect to public agricultural lands, their alienation is limited to Filipino citizens. But this constitutional purpose conserving agricultural resources in the hands of Filipino citizens may easily be defeated by the Filipino citizens themselves who may alienate their agricultural lands in favor of aliens. It is partly to prevent this result that Section 5 is included in Article XIII, and it reads as follows:

    Section 5. Save in cases of hereditary succession, no private agricultural land will be transferred or assigned except to individuals, corporations or associations qualified to acquire or hold lands of the public domain in the Philippines.

    This constitutional provision closes the only remaining avenue through which agricultural resources may leak into aliens’ hands. It would certainly be futile to prohibit the alienation of public agricultural lands to aliens if, after all, they may be freely so alienated upon their becoming private agricultural lands in the hands of Filipino citizens.

    If the term private agricultural lands is to be construed as not including residential lots or lands not strictly agricultural, the result would be that aliens may freely acquire and possess not only residential lots and houses for themselves but entire subdivisions, and whole towns and cities, and that they may validly buy and hold in their names lands of any area for building homes, factories, industrial plants, fisheries, hatcheries, schools, health and vacation resorts, markets, golf courses, playgrounds, airfields and a host of other uses and purposes that are not, in appellants words, strictly agricultural. That this is obnoxious to the conservative spirit of the Constitution is beyond question.

    If in case the property would be sold by your brother-in-law, the proper remedy is to seek nullification of the contract of sale for being void. The alien husband cannot sell a property that he is prohibited from owning.

    Again, we find it necessary to mention that this opinion is solely based on the facts you have narrated and our appreciation of the same. The opinion may vary when the facts are changed or elaborated.

    We hope that we were able to enlighten you on the matter.

    Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to dearpao@manilatimes.net

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    6 Comments

    1. I heard recently
      That the Phil. now allowed foreigner to own property in Phil . Is that try?
      I know before only condo units . I want to built my own apt . To rent it out , & be a landlord . So I can retired n have some income to supplement my social security that is not enlighten to pay for a studio apt. When was this law revised ??????

    2. https://www.airchina.us/US/GB/promotion/KnowOurAdvantages?cid=TP-Liyou%3A20160527%3ABAN%3AFacebook%3AUS%3AENMs. Acosta, I am a license broker in the USA, 35 yrs. my problem I bought 2 condo units in Lancaster, mandaluyong in 2007, I was promised delivery completion 5 yrs. from ratification of contact. I have fully paid $ 110k, I went to Manila n contacted the dev.. Owner. He told me that he run out of fund to complete the condos interior improvements. Now I heard grid in bank forclosures. I wrote him letter to get feed back but no replied. how can I put mechanic lien for the fund I fully paid? I was told that Phil & USA law are NOT the same. I’d this is in USA, we can file complain to the real estate office .

    3. Foreigners married to a Filipina frequently provide the finance to purchase residential property as well as providing the funds for the the ongoing running costs including food electric and water. Most foreigners should be aware that they cannot own property in the Philippines and any property they provide money for will be registered in their wife or partners name. Only the registered owner (Filipino) can sell the property. The title to property in question can not be transferred to another person with out the Filipina agreeing to the sale. Depending on the level of disharmony between the two parties a Filipina might agree to the sale and share the cash proceeds with her partner. However there is no legal obligation for her to do so.

    4. if I am a foreigner bought a house for 1000000 piso put in my Philippine girl friend who would the owner be

      • Yes, and if she drops you, the house is gone. So is mine. Has been married 7 years. Now divorced. The house we build is gone. Congrats :-(