In August 2020 Ayala subsidiary Ten Knots Philippines Inc. (TKPI), manager of Lio Tourism State, complied with a Department of Environment and Natural Resources (DENR) order to vacate a contested property in Barangay Pasadeña, in an undeveloped area in the north of Lio Tourism Estate. Mariglo Laririt, now in the role of director for Environment and Sustainability of TKPI, said that the company had not committed any violation but had abided with the DENR ruling and had removed fences and a guard post that had been erected on the property. Laririt said there was a ruling in their favour in 2009 which was appealed by the other party. The property had been the subject of a dispute between TKPI and a private individual, Amando Baluarte of Barangay Pasadeña. In May 2014 the Office of the President ruled to revert the property back to DENR. The dispute continued until the DENR issued a ‘final and executory’ order on 3rd April 2017. The DENR said its personnel tried to implement the order in March 2020 but was prevented from entering the property by TKPI security personnel, prompting them to issue another order dated July 2020 [2].

Tagbanua Tandulanen IP ancestral land claims

In April 2021 The Daily Taho reported that the Tagbanua Tandulanen Indigenous People (IP), through their attorneys, requested the Department of Tourism (DOT) and Local Government Unit (LGU) of El Nido to cancel, revoke, and/or deny any application for building permit, or their license itself, for more than seven Ayala-owned businesses and projects in El Nido, including the Lio Tourism Estate, Lio Airport (which serves the tourism estate) and the Miniloc Island Resort. The tribe claimed ‘rampant and widespread’ proliferation of illegal transfers and conversion of their ancestral domain/lands. The DOT, through Engr. Christopher V. Morales, had dismissed the tribe’s letter of complaint, stating that the Office does not issue permits, license, or authority to operate and that such powers belong to the LGU of El Nido which had yet to respond [3].

A Safeguards Due Diligence Report for the El Nido tourism development, prepared by the Tourism Infrastructure and Economic Zone Authority (TIEZA) for the Asian Development Bank (ADB), was published in May 2021. The report includes notes of a consultation on fisheries management concerns and livelihood projects with Barangay Officials of Villa Libertad, which covers Lio beach, part of Lio Tourism Estate. Dwindling fish catch was the major fisheries issue identified by informants, resulting from overfishing and a reduced fishing area. The number of fisherfolk remaining in the barangay had reduced to 50 individuals. The decline was also due to the lack of a permanent docking site and involvement in tourism activities. Some fishermen had become tricycle drivers. Declining fish catch and reduced access to fishing grounds were also mentioned in relation to three other Ayala resorts in El Nido, on the islands of Miniloc, Pangulasian and Lagen. The main issue to surface in a community consultation in Barangay Aberawan was declining fish catch on Lagen Island. One reason highlighted by participants for this was that fisherfolk were no longer permitted to fish within 50 metres of the island. Residents had benefitted from labouring jobs during construction of Lagen resort. Participants in a community consultation in Barangay Bebeladan said that fishing was no longer permitted within 100 metres of Ayala’s resorts on the islands of Miniloc and Pangulasian. Some residents had benefitted from the resorts with employment in roles such as housekeeping and purchasing [4].

NCIP intervenes and issues cease-and-desist order

In July 2021 the National Commission on Indigenous Peoples (NCIP) intervened in the land dispute over alleged encroachment by Ayala on the Tagbanua Tandulanen tribe’s ancestral domain in El Nido. NCIP reiterated the rights of indigenous cultural communities as stated in Republic Act 8371, also referred to as the the Indigenous People’s Rights Act of 1997 (IPRA). Dayang remedios Cabate-Cabral, head of the Tagbanua Tandulanen tribe and also a member of Principilia Council, an organization of descendants of pre-Hispanic nobilities, was questioned by the Municipal Council of El Nido over the tribe’s authority over the disputed land. The local government unit, along with regional offices of some national agencies, had issued permits to the Ayala Corporation in relation to the development project in the disputed area. However, the NCIP National Advisory No. 2021-08-001 revealed that the commission had received reports that national government agencies, local government units, and government owned and controlled corporations had been issuing permits to applicants/proponents, or are implementing programmes, projects and activities within ancestral domains without complying with the requirements of the Free and Prior Informed Consent (FPIC) process and issuance of the requisite certifications. The conflict had begun in 2015 when Ayala allegedly encroached on the ancestral domain to develop the tourism project. Chairman of NCIP, Allan A. Capuyan, said that this disregarded the IPRA law and violated the indigenous people’s rights. NCIP conducted an online meeting to settle the indigenous people’s concerns.[5]

NCIP wrote a letter, dated 31st January 2022, to Counsel for TKPI, Salvador L. Peña of Angara Abello Concepcion Regala & Cruz (ACCRA), in relation to compliance with conduct of FPIC. ACCRA responded that TKPI, owned by Ayala Land Inc., is committed to whatever lawful processes the NCIP may deem necessary, including processes specified on Section 59 of IPRA.[6] But on 15th March NCIP issued a cease-and-desist order (CDO) against Lio Tourism Estate and Lio Airport, which are owned and operated by TKPI. NCIP said in a statement that it issued the CDO due to TKPI’s refusal to undergo the process of FPIC with the Tagbanua Tandulanen IP community as mandated under the IPRA. The CDO ordered the temporary halt of projects in Barangays Libertad and Pasadeña and requested support from the provincial government to implement the order with the assistance of authorities or other government agencies if necessary. The locations of four island resorts owned by TKPI – the aforementioned Miniloc, Pangulasian and Lagen in El Nido, plus Apulit in the neighbouring Taytay municipality – are also claimed by the Tagbanua Tandulanen IP community as part of their ancestral domain. NCIP issued a show cause order to TKPI on 13th February 2022. Previously, four notices to comply had been issued by NCIP, dated 20th September 21st October, 30th December 2021 and 21st January 2022 [7].

The leader of the Tagbanua Tandulanen tribe, Maharani Apo Remedios Cabate-Cabral, spoke up against TKPI’s construction of Lio Tourism Estate: “Our elders from the Tagbanua Tandulanen IP merely want what is due to our people – the right to be recognized as the guardian and custodian for future generations of our ancestral lands…Unfortunately, due to increased public interest in Palawan, our tribe’s ancestral lands in El Nido have been adversely affected by the influx of tourists and businessmen.

How these big businesses like TKPI/Ayala Group amass a huge area of land in El Nido for their own commercial purposes have gravely affected our tribe’s way of life to the point that we cannot even fish in our own traditional fishing grounds. If we continue to allow this, then very soon our tribe would be squatters in their own ancestral lands.”

Ayala/TKPI denies violation of IPRA law

Earlier, Ayala had insisted that they had all the necessary papers and consent for the tribe when they built the Lio property, which is now a luxury tourism destination. Cabate-Cabral said “If TKPI/Ayala Group claims that it engages in corporate social responsibility projects, then it should have earlier on secured the consent of our elders as mandated by law.”[8]. 

The NCIP CDO stated: ‘Pursuant to NCIP Commission En Banc Resolution No. 08-017-2021, you are hereby directed to Cease and Desist, immediately upon receipt of this order, from operating with respect to the projects located at Villa Libertad and Pasadena, all in El Nido, Palawan’. The order did not address the land ownership dispute but faulted TKPI for failing to adhere to legally mandated consultation processes with the IP community ‘despite the series of communications and notices’ issued to them. The Tagbanua tribes were claiming to have ancestral rights over 200 hectares of property occupied by TKPI. TKPI’s legal counsel, Christopher Louie Ocampo of ACCRALAW, denied that the firm had violated the IPRA law provisions cited by the NCIP’s CDO. He said TKPI had been issued a Certificate of Non-Overlap (CNO) for the Lio Tourism Estate, by the NCIP, in 2013. Ocampo said TKPI was preparing to comply with the CDO but that due to operational and logistical considerations it was not feasible to halt operations abruptly without time to wind down. He said that the closure of Lio Tourism Estate and Airport would result in loss of jobs and livelihoods, with more than 500 of its employees facing potential job loss. Closure of Lio Airport would affect an average 600 passengers flying in and out each day [9]. 

Legal counsel calls for NCIP not to withdraw CDO

In mid-March, with NCIP Regional Office set to meet to discuss possible withdrawal of the CDO, legal counsel of Tagbanua Tandulanen IP Peter Paul Danao said NCIP should maintain it. Documents had been submitted under FPIC guidelines obliging Ayala to negotiate with and recognize the ancestral domain rights of the Tagbanua Tandulanen IP. Danao said “The CDO will oblige them to do what is right. If the CDO will be lifted they (TKPI) will only return to their usual ways of asking too many questions, resulting in the delay in the judicial process.” He said that the tribal group had been sending letter to TKPI for two years, but they had not received a serious response. According to Danao IP’s have rights over ancestral lands – part of their cultural heritage and important for preservation of the tribe’s way of life – even without formal titles. Apo Remedios Cabate-Cabral, head of the Tagbanua Tandulanen IP, also called on NCIP not to withdraw the order against TKPI as they vowed not to surrender their rights to the company. He said, “We have been fighting for this for so long. We will not give up our rights”. Cabral also asked El Nido Mayor Edna Gacot-Lim and Business Permits and Licensing Office head Bernie Bero to enforce the CDO saying there was evidence that TKPI’s subject businesses had remained operational despite receiving the CDO on 14th March. He said “This continued defiance of Ayala/TKPI is an affront to the authority of NCIP which is under the Office of the President…Worse, TKPI’s continued operations to date despite the CDO is a blatant manifestation of Ayala/TKPI’s greed at the expense of its duty to comply with existing laws.” Earlier, the Tagbanua Tandulanen group said their members were denied entry to their own ancestral lands because of TKPI projects in the area including Lio Tourism Estate, a Seda Hotel located within the resort (Seda Hotels is owned and operated by Ayala) and Lio Airport [10]. 

On 25th March 2022 former congressman and governor of the province of Ifugao, Teddy Baguilat, seeking a Senate seat and visiting to discuss IP-related issues at the Nagkakaisang Tribu ng Palawan (NATRIPAL), or United Tribes of Palawan office, stated that he favoured the issuance of the CDO. He said the IPRA law protects the IP’s cultural integrity, right to land and right to self-directed development of their land [11].

TKPI has operated in Palawan for over three decades and claims sustainability as its guiding principle, described in the Philstar article as ‘advocating for responsible tourism, stewardship over the natural environment and community engagement since its inception’. Currently operating two resorts, Lio and Sicogon in Iloilo, Reyes outlined growth plans for additional tourism estates, “We will continue to look at other opportunities in other parts of the country for eco-estates” [13]. On 6th March 2019 Lio Tourism Estate received a sustainable tourism award at ITB Berlin, the world’s largest tourism trade fair; it was included in the ‘Sustainable Destinations Top 100’ in recognition of environmentally friendly tourism management, protecting nature and the landscape in Palawan by educating contractors and workers on following environmental standards.[14] El Nido is designated as a Tourism Enterprise Zone (TEZ). Tourism Infrastructure and Enterprise Zone Authority (TIEZA) registered entities and TEZ operators may avail of a suite of fiscal incentives including:

• Income tax holiday for 6 years (extendable to another 6)

• Net loss carry over as a deduction from the gross income for the next 6 consecutive years immediately following the year of the loss

• 5% tax on gross income in lieu of all national and local taxes except real estate taxes and fees imposed by TIEZA

• Tax credit on all locally sourced goods and services

• Tax deductions equivalent to 50% of the cost of environmental protection or cultural heritage, preservation activities, sustainable livelihood programs and other similar activities [15].