Articles
Taxation Aspect of Property Sale and Purchase
Background
Business sale and purchase of property has been demanded by many people. In performing the business sale and purchase of property, it does not only need an agreement between seller and buyer, but there are things that shall be performed by both parties as one of the obligations to State. The relevant obligation is payment of a tax in acquisition of property that should be performed by buyer and seller.
In Indonesia, it has been known some types of tax that has to be met by seller and buyer in business sale and purchase of property, as follows:
1. Land and Building Tax (L&B Tax)
The regulation on L&B Tax is contained in the Law Number 12 of 1985 on Land and Building Tax as amended by the Law Number 12 of 1994 on the Amendment of Law Number 12 of 1985 on Land and Building Tax (“L&B Tax Law”).
Based on the Elucidation in Article 3 paragraph (2) of L&B Tax Law, L&B Tax is a state tax which is the majority of its revenue is a regional income that is used for the provision of facility that is also enjoyed by the Central Government and Local Government. In the beginning, L&B Tax is a tax where is its administration process is performed by the central government and all revenues are distributed to the regions with a certain proportion. In the next development, the Law Number 28 of 2009 on Regional Tax and Retribution (“Law No. 28/2009”) is applied in which the entire management process of L&B Tax, especially in rural and urban sector will be performed by local government. Tariff of L&B Tax which is imposed to tax object is 0, 5%.
Based on the Minister of Finance Decree Number 362/KMK.04/1999 on the Grant of Land and Building Tax Reduction, as amended by the Minister of Finance Regulation Number 110/PMK.03/2009 on the Amendment of Minister of Finance Decree Number 362/KMK.04/1999 on the Grant of Land and Building Tax Reduction, the amounts of L&B Tax incentive are:
• Taxable Sales Value (NJKP) of 20% for the Tax Object Sales Value (NJOP) < Rp 1 Billion; • The grant of Tax Object Sales Value which is not imposed Tax (NJOPTKP); • The grant of reduction because of certain condition of tax object which is related to the tax subject and/or because of other specific causes. 2. Acquisition Levy on Right of Land and Building (Bea Perolehan Hak Atas Tanah dan Bangunan / BPHTB) The regulation on Acquisition Levy on Right of Land and Building is governed in the Law Number 21 of 1997 on Acquisition Levy on Right of Land and Building as amended by Law Number 20 of 2000 on the Amendment of Law Number 21 of 1997 on Acquisition Levy on Right of Land and Building (“BPHTB Law”). Under the Article 1 paragraph (1) of BPHTB Law, Acquisition Levy on Right of Land and Building is a tax which is imposed to the acquisition of right of land and or building. The Acquisition Levy on Right of Land and Building is imposed to the buyer (Article 2 paragraph (1) and paragraph (2) of BPHTB Law). Tariff of Acquisition Levy on Right of Land and Building is 5% (five percent). Under the Minister of Finance Decree Number 561/KMK.03/2004 on the Grant of Acquisition on Right of Land and or Building Reduction, as amended by the Minister of Finance Regulation Number 104/PMK.01/2005, as amended by Minister of Finance Regulation Number 91/PMK.03/2006 on the Second Amendment of Minister of Finance Regulation Number 561/KMK.03/2004 on the Grant of Acquisition on Right of Land and or Building Reduction, the incentive of Acquisition Levy on Right of Land and Building property are: The grant of Tax Object Sales Value which is not imposed a Tax (NPOPTKP); The grant of reduction because of certain condition of taxpayer which is related to tax object and/or because of other certain causes. 3. The Income Tax of the Income from Transfer on Right of Land and Building (the Income Tax in Article 4 paragraph 2) The regulation on Income Tax on The Income from Transfer on Right of Land and Building is set forth in the Article 4 paragraph (2) of Law Number 7 of 1983 on the Income Tax, as amended by Law Number 7 of 1991, as amended by Law Number 10 of 1994, as amended by Law Number 17 of 2000, as amended by Law Number 36 of 2008 on the Fourth Amendment of Law Number 7 of 1983 on the Income Tax ("Income Tax Law"). Income tax which is imposed to the income of transfer on right of land and or building is 5% (five percent) of gross amount of transfer on land’s or building’s value. Income tax of transfer on right of Simple House and Simple Condominium which is performed by taxpayer that is his/her principal business to transfer on right of land and/or building is 1% (one percent) of gross amount of transfer value. Under the Article 4 paragraph (2) of Income Tax Law, the income that may be imposed the final tax are: a. the income of deposit interest and other savings, bond interest and state debenture, and saving interest which are paid by the cooperative to the individual cooperative member; b. the income of lottery prize; c. the income of shares and other securities transaction, derivative transaction which is traded on the stock, and the share sale transaction or transfer of equity shares in the company's partner which is earned by venture capital company; d. the income of transfer of asset transaction in the form of land and/or building, construction service business, real estate business, and rent of land and/or building; and e. the other certain incomes, which is set by or under a Government Regulation. Based on the provision in the Article 4 paragraph (2) letter d, it may be concluded that the income of sale and purchase of property transaction is imposed to the income tax. Under the Government Regulation Number 48 of 1994 on Payment of Income Tax on Income from The Transfer on Right of Land and/or Building, as amended by Government Regulation Number 27 of 1996, as amended by Government Regulation Number 79 of 1999, as amended by Government Regulation Number 71 of 2008 on the Third Amendment of Government Regulation Number 48 of 1994 on Payment of Income Tax on Income from the Transfer on Right of Land and/or Building, the incentive of income tax on the income from transfer on right of property land are: The Income Tax Exemption for individual person who has an income below the tax exempt income (PTKP/Penghasilan Tidak Kena Pajak) which is performing the transfer on right of land and/or building with transfer gross amount less than Rp 60,000,000.00 (sixty million Rupiahs) and is not a broken amount; The imposition of 1% (one percent) tariff from the gross amount of transfer value on the transfer on right of Simple House and Simple Condominium which is performed by Taxpayer which is the essential business is performing the transfer on right of land and/or building (general tariff of 5%). 4. Value Added Tax (VAT) The regulation of VAT is set forth in the Law Number 8 of 1983 as amended by Law Number 11 of 1994, as amended by Law Number 18 of 2000, as amended by Law Number 42 of 2009 on Third Amendment of Law Number 8 of 1983 on Value Added Tax of Goods and Services Value and Luxury Sales Tax (“VAT Law”). Under the Elucidation of VAT Law, Value Added Tax is a tax on the consumption of goods and services in the Custom Area which is imposed in multilevel in every production and distribution lines. Custom Area is the region of Republic of Indonesia which covers land, water, and air space above it, and certain places in the Exclusive Economic Zone and continental shelf which is applied to the Law that is set out of customs. Tariff of VAT is 10% (ten percent) of transaction value. Article 4 paragraph (1) of VAT Law states that the VAT is imposed on: a. delivery of taxable goods in the Customs Area which is performed by the entrepreneur; b. import of taxable goods; c. delivery of taxable services in the Customs Area by entrepreneur; d. the utilization of Intangible Taxable Goods from the outside of Customs Area in the Customs Area; e. the utilization of Taxable Services from the outside of Customs Area in the Customs Area; f. export of Tangible Taxable Goods by a Taxable Entrepreneur; g. export of Intangible Taxable Goods by a Taxable Entrepreneur; and h. export of Taxable services by Taxable Entrepreneur. The Exception for the VAT Collection 1. For Simple House and Very Simple House Under the Minister of Finance Regulation Number 36/PMK.03/2007 on the Limitation of Simple House, Very Simple House, Simple Condominium, Pondok Boro, Student Dormitory, and other houses, which is based on Delivery is Exempted from Value Added Tax, as amended by Minister of Finance Regulation Number 80/PMK.03/2008, as amended by Minister of Finance Regulation Number 31/PMK.03/2011 on the Second Amendment of the Minister of Finance Regulation Number 36/PMK.03/2007 on the Limitation of Simple House, Very Simple House, Simple Condominium, Pondok Boro, Student Dormitory, and other houses, which is based on Delivery is Exempted from Value Added Tax; the Simple House and Very Simple House which is exempted from Value Added Tax is a house which is the acquisition is cash or financed through subsidized or not subsidized credit facility, or through the financing based on the Islamic principle, which meets the following provisions: a. The building area is not more than 36 m2 (thirty-six square meters); b. The sale price is not more than Rp 70,000,000.00 (seventy million Rupiah); c. It is the first house that is owned and used alone as a residence and not transferred within a 5 years period of time since it is owned. 2. For Simple Condominium Under the Minister of Finance Regulation Number 36/PMK.03/2007 on the Limitation of Simple House, Very Simple House, Simple Condominium, Pondok Boro, Student Dormitory, and other houses, which is based on Delivery is Exempted from Value Added Tax, as amended by Minister of Finance Regulation Number 80/PMK.03/2008, as amended by Minister of Finance Regulation Number 31/PMK.03/2011 on the Second Amendment of the Minister of Finance Regulation Number 36/PMK.03/2007 on the Limitation of Simple House, Very Simple House, Simple Condominium, Pondok Boro, Student Dormitory, and other houses, which is based on Delivery is Exempted from Value Added Tax; Simple Condominium which is exempted from Value Added Tax is a multistory building which is built in an environment that used as a dwelling place which is equipped with bathroom (WC) and kitchen either united with dwelling or separate unit with communal usage, which is the acquisition in cash or financed through subsidized or not subsidized credit facility, which meet the following conditions: a. the selling price of each dwelling include condominium is not more than Rp 75,000,000.00 (seventy five million rupiahs); b. building area of each dwelling is not more than 21 m2 (twenty-one square meter); c. the construction refers to the Minister of Public Work Regulation which manages the Technical Requirement of Condominium’s Construction, and d. It is the first residential unit that is owned, used alone as a residence and is not transferable within 5 (five) years since it is owned. 3. For Simple Ownership Condominium (Rumah Susun Sederhana Milik/ Rusunami) Under The Minister of Finance Regulation Number 155/KMK.03/2001 on the Implementation of Value Added Tax which is exempted on Import and/or Delivery of Certain Taxable Goods that is Strategic, as amended by Minister of Finance Regulation Number 363/KMK.03/2002, as amended by Minister of Finance Regulation Number 371/KMK.03/2003, as amended by Minister of Finance Regulation Number 11/PMK.03/2007, as amended by Minister of Finance Regulation Number 31/PMK.03/2008 on the Fourth Amendment of Minister of Finance Regulation Number 155/KMK.03/2001 on the Implementation of Value Added Tax which is exempted on Import and/or Delivery of Certain Taxable Goods that is Strategic; Simple Ownership Condominium is a multistory building which is built in an environment that used as a dwelling place which is equipped with bathroom (WC) and kitchen, either united with dwelling or separate unit with communal usage, which is the acquisition is financed through subsidized or not subsidized ownership house credit, which meet the following conditions: a. The area for each residence is more than 21 m2 and not more than 36 m2; b. The sale price for each residence is not more than Rp 144,000,000; c. It is intended for an individual person who has an income which is not more than Rp 4,500,000 per month and has had a Tax Identification Number (TIN); d. The construction refers to the Minister of Public Works Regulation on the technical requirement of simple condominium construction, and e. It is the first residence unit that is owned, used alone as a residence and is not transferred within a 5 years period of time since it is owned. 5. Sales Tax on Luxury Goods (Pajak Penjualan atas Barang Mewah/ PPnBM) Sales Tax on Luxury Goods is a tax which is imposed on the taxable luxury goods in the Customs Area (the Elucidation of Article 8 paragraph (2) of VAT Law). Under the Article 8 paragraph (1) of VAT Law, the Sales Tax on Luxury Goods tariff is set forth as the lowest of 10% (ten percent) and the highest of 200% (two hundred percent). The export of taxable luxury goods is imposed a tax with the 0% (zero percent) tariff. The Sales Tax on Luxury Goods tariff for luxury residential groups such as luxury house, apartment, condominium, town house, and a type similar to it is 20% (twenty percent). Sales Tax on Luxury Goods is imposed to only 1 (one) time when delivery of taxable luxury goods is performed by entrepreneur who produces or imports of taxable luxury goods. Under the Article 5 paragraph (1) of VAT Law, the Sales Tax on Luxury Goods is imposed to: a. delivery of taxable luxury goods which is performed by entrepreneur who produces the goods in the Customs Area in business or work activities; and b. import of taxable luxury goods. On delivery of taxable luxury goods by producer or on the import of taxable luxury goods, beside it is imposed a VAT, it is also imposed a Sales Tax on Luxury Goods on the consideration of: a. need a balance of taxation between low-income consumers and high-income consumers; b. need to control of consumption pattern of taxable luxury goods; c. need a protection of small or traditional producers; and d. need to secure a state revenue. Under the Minister of Finance Regulation Number 620/PMK.03/2004 on the Type of Taxable Luxury Goods besides motor vehicle which is imposed the Sales Tax on Luxury Goods, as amended by Minister of Finance Regulation Number 35/PMK.03/2008, as amended by Minister of Finance Regulation Number 137/PMK.011/2008, as amended by Minister of Finance Regulation Number 103/PMK.03/2009 on the Third Amendment of Minister of Finance Regulation Number 620/PMK.03/2004 on the Type of Taxable Luxury Goods besides motor vehicle which is imposed the Sales Tax on Luxury Goods, the Sales Tax on Luxury Goods in the form of: The restriction of the Sales Tax on Luxury Goods imposition is only imposed to the luxury residence groups such as luxury house, apartment, condominium, town house, and a type similar to it from non-condominium type with a building area of 350 m2 or more and from the type of condominium with a building area of 150 m2 or more. Alsha Alexandra Kartika
The Requirement and Procedure to obtain the Information on Physical Data and Juridical Data of Land
Under Article 1 number 6 of Government Regulation Number 24 of 1997 on Land Registration (“GR No. 24/1997″), physical data is the information of location, boundary and area of land and registered condominium unit, including information of building or part of building over it.
Whereas, under Article 1 number 7 of GR No. 24/1997, juridical data is the information of legal status of land and registered condominium unit, its right holder and other rights and other burdens which are burdening the land.
The requirement and procedure to obtain the information of physical data and juridical data is regulated in the Agrarian State Minister Regulation/Head of National Land Agency Number 3 of 1997 on the Implementation Provision of Government Regulation Number 24 of 1997 on Land Registration (“Agrarian State Minister Regulation No. 3/1997”).
Under Article 187 of Agrarian State Minister Regulation No. 3/1997, the information of physical data and juridical data in land registration map, land register, measure letter and land book are open to the public. The requirement to obtain information of physical data and juridical data of land is a written application by mentioning of its need, except the Information Letter of Land Registration (SKPT) which is granted for a certificate’s examination by Land Conveyancing Officer (Pejabat Pembuat Akta Tanah/ PPAT) does not need a written application. The information may also be granted to the interested parties by visually or in writing. If the information is granted in writing, then it shall be granted in the form of Information Letter of Land Registration (SKPT).
Under Article 191 of Agrarian State Minister Regulation No. 3/1997, the physical data and juridical data which are listed in the name’s list may only be granted to the Government agency which requires for implementing their duty. The procedure of its application is by submitting the application which states the related need. The application is fulfilled after it is approved by the Head of Land Agency.
Alsha Alexandra Kartika
Legal Sanction that may arise due to the use of Building prior to Obtain Certificate of Feasible Function (“SLF”)
Under Article 1 number 16 of Local Regulation of DKI Jakarta Number 7 of 2010 on Building (“LR No. 7/2010”), Certificate of Feasible Function (“SLF”) is a certificate which is granted by Local Government against the building that has been completed and has met the requirement of feasibility function based on examination’s result of building’s feasibility function as a requirement to be utilized.
Under Article 237 paragraph (1) of LR No. 7/2010, any person prior to utilization of building shall have SLF. SLF is granted to building which has been completed, met the requirement of reliability and feasibility function of building, and its use function has to comply with Building Construction License (“IMB”).
Legal sanction that may arise if using the building prior to obtain SLF is regulated in Article 283 paragraph (2) of LR No. 7/2010, as follows:
“Every building owners, building users, service providers of building construction who violate the provisions on Article 13 paragraph (3), Article 15 paragraph (1), Article 124 paragraph (3), Article 183 paragraph (1), Article 186 paragraph (4), Article 188 paragraph (1), Article 191, Article 192, Article 195, Article 231 paragraph (1), Article 237 paragraph (1), and Article 245 paragraph (1) are punished with a maximum confinement of 6 (six) months or a maximum fine of Rp 50,000,000 (fifty million Rupiah).”
In the criminal provision, there is an article which is related to SLF, namely Article 237 paragraph (1). Therefore, it can be concluded that any building owners, building users, service providers of building construction who do not have SLF when utilizing the building, shall be punished with a maximum confinement of 6 (six) months or a maximum fine of Rp 50,000,000 (fifty million Rupiah).
Alsha Alexandra Kartika
Extraordinary General Meeting of Shareholders
The regulation on Extraordinary General Meeting of Shareholders ("EGMS") is set forth in Chapter VI Article 78 paragraph (1) and Article 78 paragraph (4) of Law Number 40 of 2007 on Limited Liability Company ("Company Law”). Article 78 paragraph (1) states that:...
Summary of Minister Regulation of Housing and Settlement Number 10 of 2012 on Implementation of Housing and Occupancy Area Through Proportional Occupancy
Background
Law Number 1 of 2011 on Housing and Settlement (“Housing and Settlement Law”) has already regulated the proportional occupancy. Under Article 34, every legal entity who intends to conduct development of housing and settlement has to implement proportional occupancy. Therefore, in order to regulate in detail the proportional occupancy, Minister Regulation of Housing and Settlement Number 10 of 2012 on Implementation of Housing and Settlement Area Through Proportional Occupancy (“Proportional Occupancy Regulation”) was issued.
Definition of Proportional Occupancy
Under Article 1 of Proportional Occupancy Regulation, the definition of Proportional Occupancy is an equal development of housing and settlement area with certain of composition in the form of single house and series house either modest house, middle house and luxury house or public condominium and commercial condominium.
Purpose of Proportional Occupancy
According to Article 3 of Proportional Occupancy Regulation, the purposes of Proportional Occupancy are:
To ensure the availability of luxury house, middle house and modest house for civilians which are constructed in one area or not in one area for modest house;
To ensure harmony among various categories of civilians from different professions, level of economy and social status of housing, settlement, occupancy area and settlement area;
To ensure crossed subsidy for procurement of infrastructure, facility, and public utility and funding of housing development;
Create a harmony of occupancy whether socially and economically; and
Utilize the use of land which is allocated for housing and settlement area.
Location of Proportional Occupancy
Every person who develops housing and settlement area are obligated to conduct Proportional Occupancy, unless developer intends to develop modest housing and/or public condominium. The implementation of housing and settlement development with Proportional Occupancy must comply with the location of Proportional Occupancy requirements. The implementation of housing and settlement area with Proportional Occupancy is conducted in a housing, settlement, occupancy area and settlement area.
The scale of housing, settlement, occupancy area and settlement area are:
Housing with at least 50 (fifty) houses to 1,000 (one thousand) houses;
Settlement with at least 1,000 (one thousand) houses to 3,000 (three thousand) houses;
Occupancy area with at least 3,000 (three thousand) houses to 10,000 (ten thousand) houses;
Settlement area with at least 10,000 (ten thousand) houses.
The requirements of location for Proportional Occupancy may be conducted in:
One regency/city in one area; or
Not in one area.
The location of Proportional Occupancy in one area at least accommodates 1,000 (one thousand) houses and location of Proportional Occupancy in separate area can be conducted in a housing which accommodate at least 50 (fifty) houses.
Composition of Proportional Occupancy
Furthermore, the compositions of Proportional Occupancy requirements are based on:
The number of houses; and
Area of the land.
The composition based on number of houses means the comparison of modest house, middle house and luxury house. The comparison is in the scale of 3:2:1, which is 3 (three) or more modest house against 2 (two) middle houses against 1 (one) luxury house.
This Proportional Occupancy Regulation defines commercial house as a housing which developed in order to obtain benefit. Luxury house defines as a commercial house with selling price four times higher than the selling price of modest house. Whereas, a modest house is defined as a public house which is built over land with area between 60 m2 and 200m2 with total floor area of building at least 36 m2 with selling price as regulated by the government. In addition to that, a middle house means a commercial house with selling price one to four times higher than the selling price of a modest house.
Composition based on land area means the comparison of area for modest house against total land area. The area of land for a modest house is at least 25% (twenty five percent) from the total land area with amount of modest houses at least equal to amount of luxury houses plus amount of middle houses.
Proportional Occupancy of Condominium
Proportional Occupancy of Condominium is a housing or occupancy area which is developed proportionally between commercial condominium and public condominium. The Proportional Occupancy is at least 20% (twenty percent) from the total floor area of commercial condominium. The public condominium may be developed in a separate building from the commercial condominium, or built within the area of commercial condominium.
Planning, Development and Controlling
A plan to develop housing and occupancy may be conducted in one or separate area or not in one area. Planning which is not in one area shall be conducted by the same person and such plans have to be in a form of the following documents:
Site plan;
design of a house;
Technical specification of a house;
Work plan of proportional occupancy;
Cooperation plan.
These documents must obtain legalization from local government, exclusively for Jakarta region it must obtain the legalization from the local government of Province of Jakarta.
Furthermore, the development of Proportional Occupancy has to be in accordance with the plan. The development of housing, occupancy area and settlement area with Proportional Occupancy solely conducted by a legal entity who works on housing and settlement area. The legal entity may be independent or in a form of cooperation as follows:
Consortium
joint operation; or
Other form of cooperation under the law.
The controlling of proportional occupancy is conducted through:
Warning letter;
Sealed location and temporary termination of development activity;
Cancellation of building construction permit;
Demolishing of building and/or
Sanctions.
The sanctions given to developer may be in a form of administrative sanctions or criminal sanctions which will be regulated further through Local Regulation, exclusively DKI Jakarta will be regulated through Provincial Regulation. In addition to that, pursuant to Article 150 of Housing and Occupancy Law, the administrative sanctions in relation to proportional occupancy may be as follows:
Written warning;
Limitation of development activity;
Temporary or permanent termination of development activity;
Temporary or permanent termination of housing management;
Temporary control by the government (locked);
Obligation to demolish the building in certain period of time;
Limitation of the business activity;
Freezing of building construction permit;
Revocation of building construction permit.
Revocation of the evidence of ownership of house;
Order to demolish the house;
Freezing of business license;
Revocation of business license;
Monitoring;
Cancellation of license;
Obligation to restore the land function in certain period of time;
Revocation of incentive;
Administrative fine and/or
Closure of location
Jeany Tabita
Summary of the Local Regulation of DKI Jakarta Number 7 of 2010 on Building
Background
The Province of DKI Jakarta is the one of the biggest city in Indonesia. As the capital city of Indonesia, DKI Jakarta provides various kinds of service to the public. One of its services is related with building development licenses. As an effort of doing servicing, structuring, supervising, and publishing of physical activity and administrative matter of the implementation of building in DKI Jakarta, the Local Government (Pemerintah Daerah) has set out the regulation of building in DKI Jakarta, with the issuance of Local Regulation Number 7 of 1991 (“LR No. 7/1991”).
Along with the times, the Indonesia Government has set out regulation on Building, namely Law Number 28 of 2002 on Building (“Law No. 28/2002”). The enforcement of Law No. 28/2002 causes amendment of LR No. 7/1991. LR No. 7/1991 is amended by the Local Regulation of DKI Jakarta Number 7 of 2010 on Building (“LR No. 7/2010”) which is valid since 5 November 2010.
Classifications of Building
Building function is classified based on:
a. Complexity level, which includes simple building, not simple building, and special building.
b. Permanence level, which includes permanent building, semi permanent building, and emergency or temporary building.
c. fire risk level, which includes building with a high level, medium level, and low level of fire risk.
d. earthquake zoning level which is set forth by the authorized agency.
e. location, which includes buildings in solid location, medium location, and tenuous location.
f. height, which includes high level building, medium level building, and low level building.
g. ownership, which includes state-owned building, business entity building, and individual building.
Right of Land Status
Any person who would construct the building must have a clear status of ownership land. For the building that is constructed on land owned by other parties, they shall obtain Land Utilization Permit (Izin Pemanfaatan Tanah) from the holder of right of land, in the form of a written agreement, containing at least the following:
a. rights and obligations of the parties;
b. area, location and boundary of land;
c. the function of building; and
d. the period of land utilization.
Building Ownership Status
Any person who owns some part of the building or whole building, shall have the evidence of building ownership which is issued by Local Government, except for the special function building by the Government. In order to issue the evidence of building ownership, each building shall have Building Construction License (“IMB”) and Certificate of Feasible Function (”SLF”).
In one building, it may be given more than 1 (one) evidence of building ownership. The evidence of building ownership may be owned by different owners and it is able to be transferred to other parties. In the matter of the building owner is not the land owner, the transfer of right shall obtain the approval from the land owner.
Requirement for the Issuance of IMB
Any person who would construct the building shall have IMB. IMB may be issued either in permanent or in temporary period of time and it may be given gradually. In order to obtain the IMB, each person shall submit the written application to the Head Office (Kepala Dinas) by attaching the minimum requirements as follows:
a. the evidence of land ownership status or the evidence of agreement;
b. Land Utilization License from the land owner;
c. identity/data of building owner;
d. technical plan of building, and
e. the result of environmental impact analysis for the building that makes a significant impact to the environment.
IMB is issued with the maximum period of time at least 30 (thirty) days since the approval of technical plan document is granted. The application of IMB that has qualified the administrative and technical requirements is approved and legalized by the Local Government. The Chief of Local Government may suspend the IMB establishment process or refuse the IMB application which does not meet the requirements.
Requirement for the Issuance of SLF
SLF is granted for building which has been completed, meeting the requirements of reliability of building and feasibility function, and the function of its utilization is in accordance with the IMB. SLF may be granted gradually in accordance with work level that has completed based on the written application. The examination of feasibility function of building based on the granted IMB, includes:
a. the compatibility of function;
b. layout of building;
c. safety;
d. health;
e. comfort, and
f. ease.
Requirement for the Issuance of Evidence of Building Ownership (Bukti Kepemilikan Bangunan Gedung)
In the matter to obtain an evidence of building ownership, each person shall submit the written application to the Chief of Local Government by attaching the administrative requirement, containing at least the following:
a. agreement and/or approval from both parties in the form of a written agreement;
b. IMB;
c. the suitability of actual data (the latest) with data in the document of right of land status, and
d. the suitability of actual data (the latest) with data in the IMB, and/or document of building ownership status that has existed/owned.
For building that has more than 1 (one) evidence of building ownership, the owner shall attach a written agreement containing at least:
a. rights and obligations of the parties;
b. area, location and boundary of land;
c. the function of building; and
d. the period of land utilization.
The evidence of building ownership is issued with the maximum period at least 30 (thirty) days since the application meet the requirement. The validity period of evidence of building ownership is based on the validity period of deed of land and/or written agreement. The application of evidence of building ownership may be deferred or rejected if it does not meet the requirements.
Requirement for the Environmental Impact Assessment
Every building plan which may cause the important environmental impact assessment shall have an environmental impact analysis. The building plan which does not cause the environmental impact shall have document of environmental management effort and environmental monitoring effort or statement of environmental management.
Administrative Sanction
Every building owner, building user, service provider of building construction, building manager who does not fulfill the obligation of function, and/or the requirement, and/or the providence of building, will be imposed administrative sanction that may include:
a. written warning;
b. restriction of construction activity;
c. temporary or permanent termination on the implementation of development;
d. temporary or permanent termination on the building utilization;
e. freezing of IMB;
f. revocation of IMB;
g. freezing of SLF;
h. revocation of SLF;
i. IPTB (Izin Pelaku Teknis Bangunan) freezing;
j. decreasing of IPTB’s level
k. revocation of IPTB;
l. revocation of the approval of discharging technical plan;
m. freezing of the approval of discharging technical plan;
n. fines; or
o. clearance of building order.
The types of sanction are determined by major and minor violations that have been performed.
Criminal Provisions
Every building technical party who violates the obligations, responsibilities, and prohibitions, shall be punished with a maximum criminal confinement of 3 (three) months or a maximum fine of Rp 50,000,000 (fifty million Rupiah).
Any building owner who does not have IMB and SLF as a requirement of the issuance of evidence of building ownership, who is constructing without having the IMB, who does not have SLF when they want to utilize the building, and who does not have the evidence of building ownership, shall be punished with a maximum confinement of 6 (six) months or a maximum fine of Rp 50,000,000 (fifty million Rupiah).
Transitional Provisions
After the LR No. 7/2010 comes into force, then:
a. The license application which is submitted and approved prior to the date of enactment of LR No. 7/2010 and it is still in the settlement process, is processed under the LR No. 7/1991;
b. IMB that has been issued under the LR No. 7/1991 but the related permit has not been issued yet, then the applicable regulation is LR No. 7/1991;
c. the building that has been established, but it has not obtained IMB yet when the LR No. 7/2010 is valid, to apply the IMB it shall obtain the SLF ; and
d. as long as the implementing regulation of LR No. 7/2010 has not been issued yet, then the existing implementation regulation is still valid as long as it is not in contrary to the LR No. 7/2010.
Alsha Alexandra Kartika
Consolidation of Limited Liability Company
Article 1 paragraph (10) of Law Number 40 of 2007 on Limited Liability Company (“Company Law”), regulates a definition of consolidation, as follows: “Consolidation means a legal action taken by two or more Companies to consolidate themselves by means of establishing a...
The Breaking, Separation, and Merging of Land
Background
The regulation on breaking, separation, and merging of land is contained in the Government Regulation Number 24 of 1997 on Land Registration (“GR No. 24/1997”) and the Agrarian State Minister Regulation/Head of National Land Agency Number 3 of 1997 on the Implementation of Government Regulation Number 24 of 1997 on Land Registration (“Agrarian State Minister Regulation No. 3/1997”).
I. The Breaking of Land Field
The breaking of land field is regulated in Article 48 of GR No. 24/1997 and Article 133 of Agrarian State Minister Regulation No. 3/1997.
GR No. 24/1997 and Agrarian State Minister Regulation No. 3/1997 do not mention the exact meaning of breaking of land. However, under the provision in the Article 48 paragraph (1) of GR No. 24/1997, it can be concluded that the breaking of land is the breaking of one land which has been registered into some area of land as requested by the right holder.
The Requirements for Breaking of Land, as follows:
Shall be in accordance with the applicable spatial plan and shall not cause non implementation of the law and regulation.
For its registration, each land is granted a new right number and created a measurement letter, a book of land and a new certificate, as a substitute of the previous right number, measurement letter, land book, and certificate. The previous measurement letter, book of land, and certificate of land right is not longer valid.
If the land right concerned is encumbered by mortgage, and/or other registered encumbrance, the breaking of land is implemented after obtaining the written approval from mortgage holder or other parties who is authorized to approve the removal of the encumbrance.
In implementating the breaking of land, as long as it is related to agricultural land, it shall note the provision of minimum limit in accordance with prevailing laws and regulation.
The application of the breaking of land that has been registered, is filed by the right holder or their proxy with the statement of breaking interest and attaching the following:
Certificate of right of land concerned;
The applicant identity;
Written approval of mortgage holder, if the land right concerned is encumbered through mortgage.
The Legal Consequence of the Breaking of Land Field [Note: ini maksudnya judul atau apa ya?]
The legal consequence of breaking of land is each part of land is a new unit of area of land with the equal legal status to the previous area of land.
II. The Separation of Land
The separation of land is regulated in the Article 49 of GR No.24/1997 and Article 134 of Agrarian State Minister Regulation No. 3/1997.
GR No. 24/1997 and Agrarian State Minister Regulation No. 3/1997 do not mention the exact meaning of separation of land. However, under the provision in the Article 49 paragraph (1) of GR No. 24/1997, it can be concluded that separation of land is the separation of one land that has been registered into a part or some parts as requested by the right holder.
The Requirements for Separation of Land Field, as follows:
1. For the registration, it is granted a right number and created its measurement letter, book of land and a separate certificate.
2. On the registration map, land register, measurement letter, book of land and certificate of land is recorded a note on separation of land.
3. The record of mortgage and other encumbrance that exists on the master book of land and master certificate of land, is recorded on a separate book of land and certificate of land.
4. The attachments that should be made in the separation of land are:
a. The master certificate of land right,
b. The applicant identity,
c. The written approval from mortgage holder, if the right of land is encumbered by mortgage.
d. A written power of attorney if the application is not filed by the right holder.
The Legal Consequence of Separation of Land
1. The equality of legal status between area of land or areas of land that are separated from its master area of land.
2. In the matter of separation of vast area of land, which is taken a part of their land to become a new unit of new area of land, the master area of land is still existed and its identity does not change, except for its width and limit.
III. The Merging of Land
The merging of land is regulated in the Article 50 of GR No. 24/1997 and Article 135 of Agrarian State Minister Regulation No. 3/1997.
GR No. 24/1997 and Agrarian State Minister Regulation No. 3/1997 do not mention the exact meaning of merging of land. However, under the provision in the Article 50 paragraph (1) of GR No. 24/1997, it can be concluded that the merging of land is the merging of two or more land that has been registered and its located is adjacent, and all of them is for and on behalf of the same owner, so that it becomes a new unit as requested by the right holder.
The Requirements for Merger of Land, as follows:
1. All of land unit are owned by the same owner and has the same term.
2. For the registration, it is granted the right number and created the new measurement letter, book of land, and certificate.
3. The registration is performed with statement that the measurement letter, book of land, and certificate of land that has been merged is no longer valid.
4. Creating the new measurement letter, book of land and new certificate for merged land.
5. The attachments that must be made in the merging of land are:
a. The certificates of land that will be merged,
b. The applicant identity.
6. May be performed if there is no record of mortgage or other encumbrance over the right of land that will be merged.
Legal Consequence of Merging of Land
The legal consequence of merging of land is the equatlity of legal status of the land as a result of merger with the status of merged land.
Alsha Alexandra Kartika