Section 7Sec./Art. 7

Penal Provision. Any contract or agreement made or executed in violation of any of the following prohibited acts shall be null and voidabinitioand both contracting parties shall be punished by a fine of not less than One hundred thousand pesos (₱100,000) nor more than One million pesos (₱1,000,000), or imprisonment of six (6) months to six (6) years, or both, at the discretion of the court:

1. Any provision in the lease agreement stipulating a lease period in excess of that provided in paragraph (1) of Section 4;

2. Use of the leased premises for the purpose contrary to existing laws of the land, public order, public policy, morals, or good customs;

3. Any agreement or agreements resulting in the lease of land in excess of the area approved by the DTI:Provided,That, where the excess of the totality of the area leased is due to the acts of the lessee, the lessee shall be held solely liable therefor:Provided, further, That, in the case of corporations, associations, or partnerships, the president, manager, director, trustee, or officers responsible for the violation hereof shall bear the criminal liability.