Mr. Louis R. Demauro

August 7, 1990 Mr. Louis R. Demauro Previews International, Inc. Regional Offices 205 Nassau Street Suite 900, Princeton N. J. 08542 S i r : This refers to your letter dated May 9, 1990 addressed to President Corazon Aquino, requesting information on how to open an upper-tier real estate office in the Philippines. If the intention of your company is to transact business in the Philippines by engaging in "realty business" the same is not legally feasible under Philippine laws. The legal capacity of a person or corporation to acquire real estate in the Philippines is regulated by law. Section 7 Article XII of the Philippine Constitution provides, thus: "Save in cases of hereditary succession, no private lands shall be transferred except to individuals, corporations or associations qualified to acquire or hold lands in public domain ." (Emphasis supplied) Corollary thereto, Sections 22 and 23 of Commonwealth Act. No. 141, otherwise known as "The Public Land Act", quoted in part hereunder, expressly provide as to who are qualified to acquire lands in the Philippines: "SECTION 22. Any citizen of lawful age of the Philippines and any such citizen not of lawful age who is a head of a family, and any corporation or association of which at least sixty percentum of the capital stock belongs wholly to citizens of the Philippines, and which is organized and constituted under the laws of the Philippines , authorized under their charter, to do so, may purchase any tract of public agricultural land disposable under this Act . . ." (Emphasis supplied) "SECTION 23. No person, corporation, association, or partnership other than those mentioned in the last preceding section , may acquire or own agricultural public land or land of any other denomination or classification, which is at the time or was originally really or presumptively of the public domain, or any permanent improvement thereon, or any real right on such land and improvement, . . ." (Emphasis supplied) Since "real estate" business involves acquisition of land by the developer, said business activity is subject to the foregoing land ownership restrictions. Accordingly, the same cannot be undertaken by a foreign company. However, if your intention is only to put up a "marketing" office for real estate without engaging in realty ownership and development business, you can apply for a license to transact business in the Philippines. In this connection, there is attached herewith an application form for the purpose, together with a checklist of requirements found on page 2 of the application. For further particulars, you may communicate directly with the Board of Investments (BOI) with business address at Buendia Avenue, Makati, Metro Manila, the government agency which is in charge of the implementation of Executive Order No. 226, otherwise known as the Omnibus Investments Code of 1987, the law regulating the entry of foreign investments in the Philippines. Please be guided accordingly. Very truly yours, (SGD.) ROSARIO N. LOPEZ Chairman