The transfer of real and personal properties, including shares of stock, in the Philippines will not be registered to the new owner in the absence of a Certificate Authorizing Registration (CAR) issued by the Bureau of Internal Revenue (BIR). A CAR certifies that taxes applicable to the transfer of registrable property have been paid.

On 08 April 2019, the BIR issued Revenue Regulations No. 3-2019 prescribing the use of the Electronic Certificate Authorizing Registration (eCAR) System for these transactions.

The eCAR System is a stand-alone system developed and owned by the BIR for the automated creation of eCAR. The eCAR, which replaces the manually prepared CAR, is equipped with barcode verification, wherein a system-generated Barcode Reference Number is printed below the barcode, which may be encoded in case the barcode is unreadable by a scanner used at the Register of Deeds (RD). The eCAR System also allows monitoring through audit trails and generated reports.

The RD shall not allow registration of any document transferring ownership of real property without a corresponding eCAR duly issued by the BIR and retrieved by the RD through the LRA-BIR eCAR Verification System. Any eCAR not found therein shall be deemed spurious. System-generated information, such as eCAR number, date of eCAR issuance, amount paid, date of payment, and signature of the authorized signatory of the eCAR, shall be indicated or stamped on the reverse side of each page of the originals of the documents transferring either registered or unregistered land.

In case of registered land and/or improvements, one (1) eCAR shall be issued per title. Thus, in practice, even if there are separate tax declarations covering the improvements on registered lands, only one (1) eCAR will be issued. The RD shall inscribe on the newly issued Transfer Certificate of Title the eCAR number, date of issuance of eCAR, RDO number, and amount and ate of payment per tax type.

For unregistered land and/or improvements, one (1) eCAR shall be issued for each tax declaration. The Provincial, City or Municipal Assessors shall indicate on the newly issued Tax Declaration the eCAR number, date of issuance of eCAR, RDO number, and amount and ate of payment per tax type.

For all other personal properties, separate eCARs shall be issued.

For purposes of presenting the eCAR to the RD, an eCAR is valid for five (5) years from date of issuance. The lapse of the five-year period will render the eCAR permanently expired and therefore of no force and effect. A new eCAR may be generated and issued upon the request of the taxpayer.

Manually issued CARs that are due for revalidation or have not been presented to the RD within the validity period, as well as manually issued CARs with partial transfer of properties are considered expired and shall no longer be valid for presentation to the RD. These CARs shall be replaced with an eCAR upon presentation of the expired manually issued CAR.

Although at present, only the BIR and LRA are linked to the LRA-BIR eCAR Verification System, the Provincial, City, and Municipal Assessor’s Offices of all LGUs, banks, and other issuers of stock certificates, bonds, and other similar paper securities are still mandated to accept only the eCAR printed and issued by the BIR from the eCAR system before any transfer of ownership is effected.

Click here to read the entire text of RR 3-2019.

Read other related entries to RR 3-2019:

1. Basic Requirements of Application for Electronic Certificate Authorizing Registration of Transfer of Shares

2. Basic Tax Consequences of Transfers of Shares Not Traded in the Stock Exchange under the Tax Code, as amended by TRAIN 1