Republic Act 12252, signed by President Ferdinand Marcos Jr. aims to attract foreign investors
PRAGUE, Czechia – A major legislative shift was signed by Philippine President Ferdinand Marcos Jr. last week permitting foreign investors to lease private land for up to 99 years.
Previously, the maximum lease term stood at 50 years, with a one-time option to extend for an additional 25 years. The updated legislation consolidates the lease into a single continuous term of up to 99 years which removes uncertainty over renewal and planning predictability.
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The revised law underscores the state’s intention to “ensure the reliability of investors’ lease contracts to provide a stable environment for foreign investments,” and explicitly targets sectors such as industrial estates, factories, and processing plants. By removing mid-course risks about lease renewal, the Philippines aims to better align with regional competitors offering more investor-friendly frameworks.
The move comes amidst growing concern over the Philippines’ capacity to attract foreign capital. According to Central Bank figures, net foreign direct investment fell by 27%, reaching $2.96 billion by end-May 2025, compared to $4.04 billion in the prior year. Meanwhile, in 2024, FDI inflows were $8.9 billion, significantly trailing behind Vietnam at $20.17 billion and Indonesia at $24.2 billion. (Reuters)
Despite the longer lease terms, the 1987 Philippine Constitution continues to prohibit foreign ownership of private land.
In June, foreign business chambers issued a joint statement urging the government to extend leasehold durations, citing the need for a “more stable and predictable leasehold system” to support long-term investments.
Stakeholders across industrial, tourism, and agricultural sectors are expected to benefit from improved confidence in lease tenure. The new framework may also enhance the country’s attractiveness in competing for foreign investment dollars, especially as regional neighbors continue to draw higher inflows.
