Strategy Tasks/Activities Responsible Agencies

TA 4293: PHILIPPINES CAPACITY BUILDING FOR HOUSING MICROFINANCE

FINAL REPORT

VOLUME 1: MAIN REPORT APPENDIX 23 December 2009 PAGE 49

Strategy Tasks/Activities Responsible Agencies land and secure tenure to more beneficiaries. (The proposed legislation covers all types of land including residential, commercial, and industrial.)

2. Streamline the system of providing secure tenure

Review and revise existing land distribution, transaction and registration requirements to bring people as fast as possible into the formal property system including:

- Reduction or elimination of transaction costs or charges

- Decentralization of approvals - Liberalization of administrative

and technical requirements and standards for approved plans and surveys for pro-poor housing

- Set time standards (facilitated and expedited procedures) for the distribution of secure tenure to urban poor beneficiaries with possible sanctions for non-compliance

DENR, HUDCC, NHA, NHMFC, LRA, other relevant agencies

Appendix 24Highlights of the 1st and 2nd Inter-Agency Conference Workshop on

Accelerating the Distribution of Secure Tenure through Rights-Based

Secure Tenure Arrangements

Appendix 24Highlights of the 1Highlights of the 1Highlights of the 1st and 2

Appendix 24and 2st and 2ndAppendix 24

InterAppendix 24Appendix 24

nd InterAppendix 24

ndAppendix 24

Inter-Appendix 24

Agency Conference Workshop on Agency Conference Workshop on Highlights of the 1Highlights of the 1Highlights of the 1 and 2and 2and 2 InterInterInter

Accelerating the Distribution of Accelerating the Distribution of Agency Conference Workshop on Agency Conference Workshop on

Secure Tenure through RightsSecure Tenure through RightsAccelerating the Distribution of Accelerating the Distribution of

Secure Tenure through RightsAccelerating the Distribution of

Based Accelerating the Distribution of

Based Accelerating the Distribution of

Secure Tenure through Rights-Based Accelerating the Distribution of

Secure Tenure ArrangementsSecure Tenure ArrangementsSecure Tenure through RightsSecure Tenure through RightsSecure Tenure through Rights Based Based Secure Tenure through Rights Based

TA 4293: PHILIPPINES CAPACITY BUILDING FOR HOUSING MICROFINANCE FINAL REPORT


Appendix 24

CONFERENCE HIGHLIGHTS

The first Technical Working Group (TWG) Meeting on Improving Land Systems for Pro-Poor Housing and Accelerating the Distribution of Secure Tenure Through Rights-Based Approaches was conducted last 18-19 January 2007 at the Canyon Woods Residential Resort, Battings. The TWG meeting was a follow-up activity for the Urban Land Reform Conference Series in October 2004 which adopted the rights-based approaches to secure tenure was identified as a key reform area in the provision of pro-poor housing. The TWG and the Urban Land Reform Conference Series were organized by the Housing and Urban Development Coordinating Council (HUDCC) with the assistance of the ADB-supported Development of Poor Urban Communities Sector Project (DPUCSP) Technical Assistance (TA) Team as part of the housing sector strengthening activities and policy reform initiatives of HUDCC in support of President Gloria Macapagal- Arroyo’s 10-Point Priority Agenda and the Medium-Term Philippine Development Plan 2004-2010.

The objectives of the workshop were: to identify rights based secure tenure instruments currently being issued by different government agencies, to identify lawful mechanisms for their issuance, and; to formulate an action plan to implement the secure tenure arrangements. The workshop also aimed to discuss issues pertaining to urban land tenure security and the reduction of urban poverty. Prior to the

Inter-Agency Conference-Workshop on Accelerating Pro-Poor Housing Through Rights-Based Secure Tenure Arrangements

January 18-19, 2007 Canyon Woods Residential Resort, Laurel, Batangas City

Asec. Celia Alba (rightmost), HUDCC Deputy Secretary General, stressed the importance of secure tenure for poverty reduction in her Opening Remarks. Seated beside her from left: Atty. Sol Castro, DPUCSP Legal and Titling Consultant, Ms. Rowena Dineros, HUDCC DPUCSP Coordinator, and Mr. Rey Dawis, DPUCSP Assets and Loan Valuation Consultant.

Land tenure security for the urban poor spurred intense discussions among key shelter agencies and stakeholders



workshop proper, the participants were provided with copies of the policy paper on Accelerating Pro-Poor Housing Through Rights-Based Secure Tenure Arrangements and workshop guide questions to facilitate the discussion. (Annex 1)

Asec. Celia Alba, HUDCC Deputy Secretary General, welcomed a total of 29 participants from the

Home Guaranty Corporation (HGC) National Home Mortgage and Finance Corporation

(NHMFC) Housing and Land Use Regulatory Board (HLURB) HDMF (Pag-IBIG Fund) Department of Environment and Natural Resources

(DENR) Land Registration Authority (LRA) Department of Agrarian Reform (DAR) Socialized Housing and Finance Corporation (SHFC) Philippine Commission on the Urban Poor (PCUP) Construction and Real Estate Builders Association

(CREBA) Development Bank of the Philippines (DBP) Bangko Sentral ng Pilipinas (BSP), Most of the government agencies who attended constituted Groups 1 and 2 of the Urban Land Reform Conference. The Program of Activities and list of participants is presented Annexes 2 and 3, respectively. In her opening remarks, Asec. Alba addressed the reason why provision of secure tenure was a key issue in uplifting the quality of life of the urban poor. In developing countries, she explained, tenure, more than ownership, is emerging as one of the most important elements to reaching the Millennium Development Goals to alleviate the plight of the urban poor. Once they have secure tenure, they themselves will act to help improve their plight. Towards this end, the TWG was designed for key shelter agencies and relevant stakeholders to discuss and formulate a policy action plan and document that will allow the use and recognition of rights-based instruments in the distribution of secure tenure to the urban poor and informal sectors. This was intended to complement the policy initiatives being considered by the BSP which are meant to further liberalize bank lending rules and regulations for socialized housing.

HUDCC DPUCSP Coordinator Rowena Dineros provided a background on the Urban Land Reform Conference and the resulting secure tenure policy action plan. She likewise updated the participants on developments following the Urban Land Reform Conference Series. Among the major accomplishments was the formulation of a policy paper to improve access of the poor to shelter finance which was presented to the Monetary Board of BSP. As a result of the presentation, HUDCC was requested to prepare a Housing Microfinance Loan Product Manual, and this is expected to be submitted to BSP by February 2007. Atty. Solomon Castro, DPUCSP Titling and Legal Consultant, followed with a detailed presentation on the policy action plan for secure tenure. The plan detailed the two strategies and the corresponding tasks/activities along with the responsible agencies agreed upon by the members of the secure tenure group during the Urban Land Reform Conference. To achieve a common

Ms. Nina Alcantara, representative of CREBA-Batangas Chapter, shared the private sector perspective on urban land issues as NHMFC’s Ms. Daisy Dulay looks on.

LRA’s Atty. Robert Leyretana discussed LRA’s mandate in registering secure tenure instruments. Seated beside him from left: Ms. Rowena Dineros, HUDCC DPUCSP Coordinator, and Engr. Florencio Inandan, PCUP representative.



Table 2: Secure Tenure Instruments Awarded and/or Recognized by Key Land and Shelter Agencies

TYPE OF INSTRUMENT AWARDING AGENCY

Certificate of Entitlement to Lot Allocation (CELA)

DENR, NHA, SHFC, NHMFC, HUDCC, PCUP

Letter of Award/Order of Award DENR Certificate of Lot Occupancy NHA Deed of Conditional Sale/ Deed of Sale DENR Torrens Title (Original/Transfer Certificate of Title)

DENR, NHA, SHFC, NHMFC,

Contract to Sell NHA Usufruct Pag-IBIG Certificate of Full Payment SHFC, NHMFC

understanding, Atty. Castro defined rights-based secure tenure arrangements as other forms of secure tenure apart from freehold.

After the presentation, Atty. Castro requested each agency to report on whether they issue, use, award and/or recognize any type of instrument, certificate or document that conferred secure tenure or other form of property/ land use/occupancy right to beneficiaries of government socialized housing or land distribution programs, and to state the legal basis for the power of the agency to issue those instruments, certificates or documents. A lively exchange ensued based on the participants’ actual experiences from implementing socialized housing programs. There was a balance of ideas as insights from the private sector, represented by CREBA, complemented the government perspective of the key shelter and land agencies as well as the sentiments of the intended urban poor beneficiaries represented by PCUP.

In addition to the inefficiencies in land regulation and administration including the protracted titling process, valuation of land, and private sector participation, the topics that were discussed also concerned the acceptance and valuation of interim titles as collateral substitutes. The incremental approach to secure tenure was also identified as an approach that ensures that urban upgrading projects are more sustainable and can be upscaled to meet the demand. However, the acceptability of these rights-based instruments to the government and financial institutions involved was of primary importance to the group. It was explained that an ongoing ADB-funded project in the Philippines, the DPUCSP, is working with relevant government agencies and financial institutions, including the central bank, to agree on the policies, regulations, and risk-protection mechanisms that will facilitate the acceptance of transactions involving rights-based instruments. An important conclusion reached during the workshop was the identification of interim titles and rights-based instruments that may be the basis for the incremental approach to secure tenure. Foremost would be the Certificate of Entitlement to Lot Allocation (CELA). About five agencies award or recognize the CELA as a form of tenure instrument. Next to the CELA were lease variants and the Certificate of Full Payment and/or Deed of Sale. In expressing support for the initiative to recognize interim titles, the LRA representative confirmed that lease contracts were already registrable under the

Table 1: Overview of Existing Tenure Systems in Developing Countries

TENURE SYSTEM BASIC FEATURE(S)

Freehold Perpetual ownership

Delayed freeholds Conditional ownership. Title is granted upon completion of payments or when developments have been completed.

Registered leasehold Ownership rights only for a specified period, usually from a few months to 999 years

Public or Private rental Rental occupation of publicly- or privately-owned house and lot

Non-formal tenure Includes wide range of categories including regularized squatting and various forms of unofficial rental arrangements



current system. For other rights-based instruments, he supported the proposal to study if these were registrable based on existing legislation or whether new policy is needed to enable their recognition. The TWG agreed to the creation of a subcommittee tasked to prepare the standard forms and terms of the interim titles and rights-based instruments, and to draft the joint circular to legalize these instruments. The subcommittee to comprise legal and operations staff of the concerned agencies will be convened on 9 February 2007. Prior to the subcommittee meeting, the agencies were requested to submit to HUDCC the workshop guide questions and templates of the secure tenure instruments. Mr. Leopoldo Resmundo gave the closing remarks on behalf of DBP, the co-executing agency of DPUCSP. He thanked the participants on behalf of the organizers, and acknowledged the valuable contributions made during the workshop.



Introduction HUDCC has taken a lead role, through the ADB-assisted Development of Poor Urban Communities Sector Project (DPUCSP), in advocating for changes in the social housing sector that are principally focused on affording full recognition and acceptance of rights-based secure tenure instruments and further liberalizing bank lending rules and policies to accelerate the provision of pro-poor housing in the country. These reforms are intended to regularize informal settlements and give legal tenure to the poor and homeless and at the same time, improve their access to affordable shelter finance through the introduction and promotion of housing microfinance best practices. An inter-agency Urban Land Reform Conference initiated by HUDCC was held on October 14-15, 2004 at the Holiday Inn Clark, Pampanga to gain awareness, marshal support, and advocate for rights-based approaches to accelerate the government’s secure tenure campaign and poverty reduction program through asset creation for the poor. Conference participants coming from 14 different government agencies agreed to develop lawful mechanisms for the issuance of rights-based secure tenure or interim titling instruments for pro-poor housing and establish institutional linkages among them for the purpose of adopting and recognizing rights-based approaches or non-freehold type of land use instruments. This strategy was formulated to fast track the distribution of secure tenure in government social housing programs particularly in instances where: (1) complex titling, land conversion and proclamation procedures tended to delay the grant of land use rights to target beneficiaries; (2) the sale of land or freehold ownership would not be an affordable or suitable mode of land tenure or property right acquisition; or (3) the government needed to reserve the land for more optimal or beneficial uses in the future. A complementary objective was developing rights-based instruments as possible collateral substitutes to support housing finance initiatives catered to meeting the shelter needs of the poor through appropriate bank regulatory reforms within acceptable prudential standards. Taking off from the agreements reached at the conference, the two technical working groups (TWG) for Improving the Proclamation, Land Conversion and Registration Process for Pro-

Accelerating the Distribution of the Secure Tenure for Pro-Poor Housing Through Rights-Based Instruments

2nd Technical Working Group Workshop/Conference Report December 7-8, 2007

Punta De Fabian Resort, Baras, Rizal



Poor Housing and the Distribution of Secure Tenure through Rights-Based Approach convened during the first workshop held last January 18-19, 2007 at the Canyon Woods Residential Resort in Laurel, Batangas. The TWG meeting was called for the purpose of developing a specific action plan that would carry out the necessary reforms to accelerate the distribution of secure tenure and to complement the policy initiatives on housing microfinance which had been submitted earlier by HUDCC to the BSP for Monetary Board approval. The initial meeting was followed up by separate consultations conducted by HUDCC and the ADB-DPUCSP Consultants with the different government agencies involved in the distribution of land and other property rights to beneficiaries of public socialized housing programs. As a result of these individual meetings and consultations, a complete inventory of legal instruments used in the distribution of land, formal property rights, and other forms of secure tenure was put together and samples of the actual documents issued by these agencies were compiled. Applicable regulations that governed the issuance of these different instruments were also obtained and reviewed. This Report presents the results of the second workshop conducted last December 7-8, 2007 at Punta de Fabian, Baras, Rizal. All workshop outputs discussed in the Report have been prepared by a select technical team tasked to harmonize and draft the rights-based instruments including the proposed implementing guidelines for their adoption. Workshop Objectives 1. The specific objectives of the 2nd TWG workshop were to: Consolidate, harmonize, standardize and possibly redefine the terms and conditions of

various rights-based secure tenure instruments being issued by the different government agencies concerned to ensure their validity, uniformity, integrity, security, enforceability, registrability and bankability as property rights or land use conveyance documents; and

Craft coherent rules and guidelines that would govern the distribution and use of

rights-based secure tenure instruments in government social housing programs. TWG Members and Workshop Participants The participants and members of the TWG responsible for completing and submitting all the workshop outputs were:

Name Designation Agency Zaki Abañes Director, Policies and Program Development HUDCC Rowena Dineros PMO-DPUCSP HUDCC Myles Rivera Director IV HUDCC Atty. Jose Melgarejo Manager, Legal Department SHFC Jose Melgarejo Manager SHFC Ma. Alma Valenciano Manager, NCR Area Management NHA Socorro Salvosa Division Manager NHA Corazon Davis Director, NCR DENR-NCR Atty. Che Morales DRD II LRA Engr. Bernardo Ibe Engineer II DENR-LMB Kristina Tordilla Assistant Manager DBP Leopoldo Resmundo Manager, Housing Unit DBP Atty. Solomon Castro Legal Specialist DPUCSP.



Workshop/Conference Proceedings Types of Rights-Based Secure Tenure Instruments Members of the TWG coming from the different key shelter and public land administering agencies reviewed the inventory of government-issued rights-based secure tenure instruments. Using the initial inventory prepared during the 1st TWG workshop held in January 2007 as a reference, the agencies confirmed that they were using the following instruments as conveyance documents to qualified government social housing beneficiaries:

Table 1. Government Issued Instruments After analyzing the common features of these instruments and based as well on the legal mandates and practical experiences of the different agencies concerned, it was agreed that the following major categories of property rights, land use or rights-based instruments should be used by the government and should be made available to qualified social housing beneficiaries:

Table 2. Main Categories

Five (5) Major Categories of Secure Tenure Instruments for Government Social Housing Programs

Deed of Sale/ TCT (freehold)

Contract to Sell (conditional freehold)

Usufruct (leasehold)

Lease variants (leasehold)

CELA (right to occupy or purchase)

AGENCY RIGHTS-BASED INSTRUMENT

DENR CELA; Order of Award; Deed of Sale/Deed of Conveyance

SHFC CELA; Deed of Sale/TCT (in the name of the HOA but monthly amortizations are paid by the individual members)

NHA CELA; Lease Contract; Usufruct; Conditional Contract to Sell; Lease with Option to Purchase; Deed of Sale

HUDCC CELA



Main Features The rights-based secure tenure instruments that the government would be issuing in line with this policy initiative must have all the basic features described below:

Validity – All instruments should lawfully convey the intended property rights to the program beneficiaries and should clearly establish the appropriate or preferred mode of acquisition. Documents must conform to all the substantive requirements and legal formalities provided under the Civil Code of the Philippines, public land laws, land registration decrees, and other regulations governing the valid disposition of land and other property rights.

Integrity – All conveyance instruments should bear distinct characteristics showing

that it is an officially sanctioned property rights instrument issued by the government pursuant to the National Shelter Program.

Security – Documents should possess adequate control and security features to

prevent or detect fraud, mistake, or the multiple granting of rights to the same awardee. These features should include printing on security paper, having control numbers and/or bar codes, designating authorized government signatories, and setting up a central database or information system for control, audit, monitoring, enforcement, recording, and program management purposes.

Negotiability and Bank ability – A key element to creating assets for the poor and

improving their quality of life is access to affordable housing finance. Banks should therefore be able to lend for home improvement, housing construction or house and/or lot acquisition on the basis of these instruments and create security interests against them as possible collateral substitutes, if necessary or warranted. Among other features, they should be assignable to and enforceable by lending institutions, guarantors, or other third parties for that particular purpose.

Registrability and Enforceability – The instruments must be registrable pursuant

to property registration laws so that the rights of the grantees could be protected and would be legally binding, defensible and enforceable against third parties.

Restrictions and Encumbrances – Mandatory restrictions against the resale,

transfer or assignment to unqualified persons of land or other property rights given by the government to social housing beneficiaries should be fully incorporated in the terms and conditions of rights-based secure tenure instruments.

Specific Terms and Conditions For each category, standard terms and conditions were formulated for uniformity and consistency. Having identifiable elements and provisions also served to enhance the validity of the documents and help facilitate subsequent transactions and dealings involving these properties and real rights.



Table 3. Standard Terms and Conditions of Government-Issued Rights-Based Secure Tenure Instruments

Deed of Absolute Sale/ TCT

CTS/CCS

(Contract to Sell/ Conditional Contract to Sell)

Usufruct Lease

CELA

(Certificate of Eligibility for Lot/Unit Allocation)

1. Nature of the contract 2. Names of the contracting

parties (government-seller, buyer-beneficiary)

3. Provide relevant recitals

(whereas clauses) 4. Insert technical description

of the property 5. Executed upon full payment

of the purchase price of the land/ property/ housing unit

6. Involves absolute transfer of

ownership 7. Use shall be primarily for

residential purposes only (but microenterprise and small businesses are permissible).

8. Stipulate restrictions against

unauthorized transfers, disposition and other encumbrances (except for


parties (government-seller, buyer-beneficiary)



of the property 5. Executed when purchase

price is not paid in full but by installment

6. Insert schedule of

payments, interest rate, penalties, and agreed payment period

7. Use shall be primarily for



unauthorized transfers,


parties (government-owner, usufructuary-beneficiary)



of the property 5. Executed when usufructuary

rights are given by the government-owner to the beneficiary

6. Insert schedule of

payments, interest rate, penalties, agreed payment period and other terms

7. State period of use 8. Title remains with the

government-owner but all other property rights such as use, possession and enjoyment of the fruits


parties (government-lessor, beneficiary-lessee)



of the property 5. Executed when leasehold

rights are given by the government-lessor to the beneficiary

6. Insert rental payment and

terms, interest rate, and penalties, if any

7. State period of lease 8. Title remains with the

government-lessor but use and possession are given to the lessee


1. Nature of instrument 2. Names of the contracting

parties (government, beneficiary)

3. State legal basis and

relevant background for award of CELA

4. May or may not contain the

technical description of the property

5. Granted when beneficiary

has been pre-qualified to acquire the property and considered eligible to purchase a lot or unit in a government social housing or land distribution program

6. Issuance of CELA signifies

that beneficiary has been pre-qualified by NHA and has been cleared based on the agency’s Alpha-Listing, among others




CTS/CCS


Usufruct Lease

CELA


hereditary succession) as mandated by applicable laws; leasing of the entire property is prohibited

9. Buyer is responsible for

transfer costs 10. Any misrepresentation by

the buyer during application or in the course of the transaction shall be a ground for the automatic cancellation, rescission of the Deed of Sale/ TCT; property will be automatically reconveyed to the government-seller

11. Buyer’s rights are

assignable for the purpose of securing housing finance subject to the express written consent of the government-seller/ issuing agency.

12. State other

grounds/conditions for automatic cancellation of CTS/CCS such as but not

disposition and other encumbrances (except for hereditary succession) as mandated by applicable laws; leasing of the entire property is prohibited

9. Any misrepresentation by

the buyer during application or in the course of the transaction shall be a ground for the automatic cancellation, rescission of the CTS/CCS; property will be automatically reconveyed to the government-seller

10. Define obligations of the

parties regarding tax payments and transfer costs

11. Until full payment of the

purchase price, title vests in the government-seller but possession is given to the buyer-beneficiary by way of lease

12. If there is no structure yet,

buyer is given the right to

(except the right to alienate and destroy) are given to the usufructuary-beneficiary




unauthorized transfers, disposition and other encumbrances (except for hereditary succession) as mandated by applicable laws; leasing of the entire property is prohibited


the usufructuary during application or in the course of the transaction shall be a ground for the automatic cancellation, rescission of the contract; property will be automatically reconveyed to the government-owner


parties regarding tax



unauthorized transfers, disposition and other encumbrances (except for hereditary succession) as mandated by applicable laws; subleasing of the entire property is prohibited


the lessee during application or in the course of the transaction shall be a ground for the automatic cancellation, rescission of the contract of lease; property will be automatically reconveyed to the lessor


parties regarding tax payments and transaction costs


7. Effective only for a stipulated period during which time the beneficiary must apply to acquire the property in accordance with the rules and requirements prescribed by the government agency concerned

8. Title remains with the

government but the beneficiary has the right to occupy the property if on-site or is given the right to purchase the land or the housing unit subject to all applicable laws and regulations




unauthorized transfers, disposition and other encumbrances (except for hereditary succession) as




CTS/CCS


Usufruct Lease

CELA


limited to non-payment of real property tax

build 13. Buyer’s rights are

assignable for the purpose of securing housing finance subject to the express written consent of the government-seller/ issuing agency

14. State other

grounds/conditions for automatic cancellation of CTS/CCS such as but not limited to non-payment of real property tax

payments and transaction costs


usufructuary is given the right to build

14. Rights of the beneficiary are

assignable for the purpose of securing housing finance subject to the express written consent of the government-owner/ issuing agency

15. State other

grounds/conditions for automatic cancellation of usufruct

16. All permanent

improvements revert to the government-owner when the period of use expires.

lessee is given the right to build

14. Rights of the lessee are

assignable for the purpose of securing housing finance subject to the express written consent of the government-owner/ issuing agency

15. State other

grounds/conditions for automatic cancellation of the lease

16. All permanent

improvements revert to the government-lessor when the lease period expires

mandated by applicable laws; absolutely no transfer, selling or disposition of rights to other persons


the beneficiary during application or in the course of the transaction shall be a ground for the automatic cancellation of the CELA

12. State other

grounds/conditions for automatic cancellation of the CELA



Guidelines and Implementation Arrangements To ensure faithful compliance with and consistent application by the various agencies concerned of the features and terms devised for rights-based secure tenure instruments, proposed operating policies and implementing guidelines have also been drafted. If adopted, these rules would constitute the National Guidelines on Land Disposition and Secure Tenure Distribution for Residential Purposes in Government Socialized Housing Projects. Among the key features, policies and principles to be incorporated in the guidelines are:

Designation of a central depository and processing agency to specifically handle beneficiary qualification for the disposition of public land and the distribution of secure tenure for socialized housing. The agency will also issue the corresponding certificate of eligibility for lot/unit allocation (CELA) to each qualified beneficiary of any national socialized housing project. This agency is proposed to be the NHA.

Strict implementation of the “One Land Grant” policy in accordance with applicable

laws and regulations ensuring that only those who do not own real property in urban or rural areas are qualified to become beneficiaries under RA 7279.

The guidelines shall have nationwide application and shall be observed by all

departments, bureaus, offices, agencies, government-owned-and-controlled corporations, and local government units.

Upon request, HUDCC shall certify the authenticity of the rights-based instruments

issued by the different agencies for the purpose of confirming the genuineness of those documents and the valid conveyance of property rights in favor of the beneficiary, which should facilitate transactions involving these instruments particularly when used as collateral substitutes for end-user shelter financing.

The recommended process flow and implementation arrangement for the valid issuance of rights-based instruments by government agencies are presented in the flowchart below. The basic steps include: (1) All agencies involved in land and secure tenure distribution shall submit the list of their target beneficiaries to the NHA for eligibility check against its alpha-listing; (2) If qualified,

NHA shall issue the standard or uniform CELA in the name of the beneficiaries (the agency sponsor/proponent may be a co-signatory); (3) Each agency has the discretion to determine the basic bankable documents that beneficiaries can use as possible collateral substitutes to secure home improvement/repair, housing construction, house and/or lot acquisition loans; (4) To facilitate the recognition and acceptance of these instruments by third parties and assure registration with the Register of Deeds, agencies shall request HUDCC to issue a certification confirming the genuineness of the document and valid conveyance by the government of property rights in favor of the beneficiary concerned.



Recommendations and Next Steps To carry out the foregoing tasks, the workshop outputs include: (1) a draft EO to be signed by the President of the Philippines directing the concerned agencies to jointly issue and implement the national guidelines for land disposition and secure tenure distribution in government socialized housing programs (attached hereto as Annex A); (2) the draft national guidelines in the form of a joint circular to be issued by DENR, DILG, HUDCC, NHA, SHFC, and LRA (Annex B); and (3) samples of the various rights-based secure tenure instruments to serve as useful references by government agencies in the design and writing of their own contracts or documents (attached as Annex C).

DENR

NHMFC

SHMFC

NHA Keeps alpha-listing of beneficiaries Validates eligibility Ensures “One Land Grant” Policy

LGUs DPWH

BCDA, MMDA, etc. DAR NCIP

CELA Issued by NHA with control number Concerned agency is a co-signatory Authority may be delegated to LGUs

Accountable Form

Step 1

NHA (e.g., CTS) SHFC Others

DENR

(e.g., Order of Award)

Each agency to determine the basic bankable documents for end-user financing

HUDCC Cover Letter or Certification of Validity

Accountable Form

Step 2

FLOWCHART

PRE-QUALIFICATION



It is recommended that the workshop outputs be favorably considered by the agencies’ respective heads or principals for finalization before their common endorsement to the Office of the President. Once the agencies have agreed on the final form and content, it is also recommended that HUDCC should take the lead in finding grant or other sources of donor funding to assist the government principally in developing and investing in a rights-based instruments information systems plan. This plan will assess or identify the critical management/operating/business systems, applications development and systems management requirements, hardware platform, including staffing and training needs, which should all result in the automation of beneficiary qualification processing, collation and reporting; data sending and posting; and application, processing, validation and recording of rights-based instruments in government social housing projects.

Appendix 25Draft Executive Order on

“Accelerating the Distribution of Secure Tenure through Rights-Based

Secure Tenure Instruments

Appendix 25Draft Executive Order on

Appendix 25

“Accelerating the Distribution of “Accelerating the Distribution of

Draft Executive Order on

Secure Tenure through RightsSecure Tenure through Rights“Accelerating the Distribution of “Accelerating the Distribution of

Secure Tenure through Rights“Accelerating the Distribution of

Based “Accelerating the Distribution of

Based “Accelerating the Distribution of

Secure Tenure through Rights-Based “Accelerating the Distribution of

Secure Tenure InstrumentsSecure Tenure InstrumentsSecure Tenure through RightsSecure Tenure through RightsSecure Tenure through Rights Based Based Secure Tenure through Rights Based



Appendix 25

Draft Executive Order on “Accelerating the Distribution of Secure Tenure through Rights-Based Secure Tenure Instruments”

MALACAÑAN

Manila

BY THE PRESIDENT OF THE PHILIPPINES

EXECUTIVE ORDER NO. _____

ACCELERATING THE DISTRIBUTION OF SECURE TENURE TO QUALIFIED SOCIALIZED HOUSING BENEFICIARIES THROUGH THE USE OF RIGHTS-BASED SECURE TENURE INSTRUMENTS UNDER THE NATIONAL SHELTER PROGRAM

WHEREAS, it is the policy of the State to undertake a comprehensive and continuing Urban Development and Housing Program by giving the underprivileged and homeless citizens access to land and housing, and providing for an equitable land tenure system that shall guarantee security of tenure to Program beneficiaries;

WHEREAS, the Urban Development and Housing Act of 1992 (UDHA) authorizes the formulation and use of various alternative schemes for the disposition of lands to the beneficiaries of the Program which shall not be limited to transfer of ownership in fee simple but shall also include lease, usufruct, public rental housing or such other variations as the government may deem most expedient in carrying out the purposes of the Act;

WHEREAS, several government agencies, pursuant to their respective mandates under applicable public land, property registration and urban land reform laws, are actively involved in the disposition of public alienable & disposable or proprietary land and in the distribution of secure tenure to Program beneficiaries; WHEREAS, government socialized housing projects are affected by the scarcity or unaffordability of land, particularly, in highly urbanized areas, by complex land titling issues and procedures, or by competing and equally important public uses for the targeted social housing sites; WHEREAS, to address these concerns and to respond more effectively to the growing need for pro-poor housing in the country at the needed scale, there is a need to streamline, standardize, harmonize and improve the mechanisms and procedures for the distribution of secure tenure to the country’s poor and homeless citizens.



NOW, THEREFORE, I, GLORIA MACAPAGAL-ARROYO, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby order:

SECTION 1. Use of Alternative Schemes for the Disposition of Land and the Grant of Secure Tenure. – All departments, bureaus, offices, agencies, government-owned-and-controlled corporations and local government units (LGUs) involved in the disposition of public alienable & disposable or proprietary land and the grant of secure tenure to beneficiaries of socialized housing projects under the National Shelter Program shall formulate and adopt suitable schemes for the faster conveyance of lawful property rights consistent with the following forms of land tenure as they are defined under all applicable laws:

(a) Ownership in fee simple/freehold; (b) Contract to sell; (c) Usufruct; (d) Lease and its variants; and (e) Right to occupy or purchase an allocated parcel of land or housing

unit, and similar basic property rights.

SECTION 2. Standard Forms and Terms. – All contracts, deeds and instruments issued by the government that convey property rights in favor of Program beneficiaries shall adhere to the standard forms, features and terms to be recommended by a joint technical working group composed principally of the following agencies:

(a) Housing and Urban Development Coordinating Council (HUDCC) – Chairman

(b) Department of Environment and Natural Resources (DENR) – Member

(c) Department of Interior and Local Government (DILG) - Member (d) National Housing Authority (NHA) – Member (e) Social Housing Finance Corporation (SHFC) – Member (f) Land Registration Authority (LRA) – Member.

All instruments shall have the necessary terms and conditions that will ensure the validity, enforceability, integrity, security, negotiability, registrability and, if authorized and deemed appropriate, the bankability of said documents for use as possible collateral substitutes for end-user shelter financing as may be allowed under banking and housing laws, rules and regulations. SECTION 3. Beneficiary Pre-Qualification. – Prior to any allocation or award of units and/or lots in favor of socialized housing beneficiaries, all agencies and LGUs implementing socialized housing projects shall submit their lists of potential beneficiaries to the NHA which, on the basis of its alpha-listing, shall determine the eligibility of said beneficiaries in accordance with the pre-qualification criteria set under applicable laws, rules and regulations. The government agency or LGU concerned can issue a certificate of eligibility for lot/unit allocation (CELA) to its intended beneficiaries after the pre-qualification process is completed.



The NHA shall update its alpha-listing based on the cleared lists and shall also be the central repository of the names of and other relevant information regarding qualified and awarded beneficiaries of socialized housing programs. For this purpose, agencies and LGUs must submit their respective lists of social housing beneficiaries to the NHA within sixty (60) days from the date of this Order. Otherwise, the NHA can defer the clearing of future lists submitted by that agency or LGU until it has complied with the foregoing requirement. SECTION 4. One Land Award Policy. – Consistent with the eligibility criteria for beneficiaries under the UDHA, national agencies and LGUs shall strictly enforce the “One Land Award” Policy such that persons who already own real property or those who are considered “professional squatters” as that term is legally defined, are disqualified from becoming beneficiaries of socialized housing programs. SECTION 5. HUDCC Certification and Program Implementation. – To ensure the recognition of rights-based secure tenure instruments in socialized housing programs and to facilitate their use as possible collateral substitutes for housing finance purposes, HUDCC shall, upon the request of the government agency or LGU concerned, issue a covering note or certification (adopting, as close as possible, the same document form and basic security or control features of a Torrens title) that confirms both the genuineness of the instrument issued by the government agency or LGU and the lawful conveyance by the government of a valid property right in favor of a beneficiary of a legitimate socialized housing program. HUDCC shall also take the lead in arranging to source grant and other forms of financing or technical assistance to set up the necessary information systems and provide the other logistical requirements to help carry out the accelerated land disposition and improved access to social housing finance initiatives contemplated in this order. Funds needed to immediately carry out the provisions of this order shall be taken from the available funds of the key agencies concerned. Said agencies shall also program the budgetary requirements needed to perform their functions in all their subsequent budgets. SECTION 6. Joint Guidelines. – The key shelter and main public land administering agencies, namely, HUDCC, DENR, DILG, NHA and SHFC, in coordination with LRA, shall prepare and issue a joint circular or order promulgating the Guidelines on the Disposition of Public Alienable & Disposable or Proprietary Land and the Distribution of Secure Tenure for Residential Purposes in Government Socialized Housing Programs, whose terms and provisions shall have nationwide application and shall be fully consistent with this Order and all applicable laws.

Said guidelines shall be finalized and approved by the heads of the concerned agencies within thirty (30) days from the effectivity of this Order.

SECTION 7. Application. – The provisions of this Order shall only apply to the distribution of secure tenure in socialized housing projects, and NOT to the



disposition of public alienable & disposable or proprietary land to or the regularization of tenure of actual occupants who may not be entitled to the benefits provided by law to bona fide socialized housing beneficiaries.

SECTION 8. Repealing Clause. – All executive issuances, rules and regulations or parts thereof that are inconsistent with the provisions of this Executive Order are hereby repealed, amended or modified accordingly.

SECTION 9. Effectivity. – This Executive Order shall take effect immediately.

DONE in the City of Manila, this ___ day of July, in the year of Our Lord, Two Thousand and Eight.

GLORIA MACAPAGAL ARROYO

By the President:

EDUARDO R. ERMITA Executive Secretary

Appendix 26Draft Implementing Guidelines for

Rights-Based Instruments

Appendix 26Draft Implementing Guidelines for Draft Implementing Guidelines for

Appendix 26

RightsRightsDraft Implementing Guidelines for Draft Implementing Guidelines for

RightsDraft Implementing Guidelines for

Based InstrumentsDraft Implementing Guidelines for

Based InstrumentsDraft Implementing Guidelines for

Rights-Based InstrumentsDraft Implementing Guidelines for


VOLUME 1: MAIN REPORT • APPENDIX 26 December 2009 PAGE 1

Appendix 26

Draft Implementing Guidelines for Rights-based Instruments

















Appendix 27Draft Standardized and Harmonized

Rights-Based Instruments

Appendix 27Draft Standardized and Harmonized Draft Standardized and Harmonized

Appendix 27

RightsRightsDraft Standardized and Harmonized Draft Standardized and Harmonized

RightsDraft Standardized and Harmonized

Based InstrumentsDraft Standardized and Harmonized

Based InstrumentsDraft Standardized and Harmonized

Rights-Based InstrumentsDraft Standardized and Harmonized



Appendix 27

Draft Standardized and Harmonized Right-based Instruments

Deed of Absolute Sale







Certificate of Full Payment



Order of Award





Certificate of Entitlement to Lot Allocation (CELA)













Certificate of Inclusion in Master List of Eligible Beneficiaries









Lease/Purchase Agreement







Sublease Agreement









Conditional Sale







