Background Based on Government Regulation Number 24 of 1997 on Registration of Land, the transfer of right of land can be conducted by some means which are (i) sale and purchase (jual-beli), (ii) inheritance (warisan), (iii) testament (wasiat), (iv) grant (hibah), and...
The building has an important part as the place for human being to conduct their daily activities. The regulation on the building is the Law Number 28 of 2002 on Building (the “Building Law”). The knowledge on the Building Law becomes important because the Building...
The interest to live in the condominium tends to increase particularly to people who live in the big cities. According to Article 7 Law Number 16 Year 1985 on Condominium, it is stipulated that the condominium can only be constructed over land of Right to Own (Hak Milik), Right to Build (Hak Guna Bangunan), Right to Use (Hak Pakai) on State Land or Right to Manage (Hak Pengelolaan). In the event the developer is formed as business entity in the form of Limited Liability Company, the possible land title for this legal entity is the Right to Build. According to Decree of State Minister for Public Housing Affairs Number 11/KPTS/1994 on the Guidance on Conditional Sale and Purchase of Condominium (Pedoman Pengikatan Jual Beli Satuan Rumah Susun) states the developer shall obtain the following licenses:
Principle License, means the license which must be owned by a person or legal entity that will utilize the space for large scale business;
Location Permit from Regency or Municipal Land Office, for DKI Jakarta known as License of Land Appointment and Utilization (Surat Izin Penunjukkan dan Penggunaan Tanah / SIPPT). This license is given to a company in order to obtain the land for investment which is also valid as the license in relation to transfer of right, and to utilize the land for investment. This license is issued by the competent authorities for the land utilization in main route or for the land utilization of more than five thousand (5,000) m2. The developer has to obtain SIPPT prior to conducting the building construction;
Building Construction Permit, means the license to construct. The Developer is responsible to obtain this license from the competent authorities. If the building does not have the building construction permit, it will be categorized as illegal building and the competent authorities have the right to seal and demolish it.
After the developer completes the construction process, there are several steps that must be passed by the developer before the Certificate of Right to Own on Condominium (Sertifikat Hak Milik atas Satuan Rumah Susun) unit is issued:
Detail of division (pertelaan), means boundaries designation for the condominium, common facility, common equipment and common land with the proportional comparative value in the form of picture and description. In brief, the process begins with the submission of application through National Land Agency to Governor, and followed by research by related institutions together with Head of National Land Agency. Based on the research report from related institutions, the Ratification Decision will be issued and ratified by the Governor for DKI Jakarta and Regional Government for other regions;
Occupancy Worthiness Permit (Izin Layak Huni) means the license issued by Regional Government after investigating the condominium of which its construction is already finished based on the requirements and issued licenses. In the event these licenses have not been issued but the condominium unit is already sold or occupied, according to Law Number 16 Year 1985 on Condominium, there is criminal sanctions of 1 (one) year maximum or a fine of Rp 1,000,000.00 (one million rupiah) maximum;
Deed of Separation of Condominium, this deed is a proof of the separation of condominium unit which includes common facility, common equipment and common land which is registered to the Land Agency which will be approved by the Governor. This deed is used as the basis to issue the Certificate of Right to Own Condominium Unit. According to Regulation of Head of the National Land Agency Number 2 Year 1989 on Form and Procedure and Registration of Deed of Separation of Condominium, it is stated that the Deed of Separation must be registered by the developer to Land Officer together with the Land Certificate and Occupancy Worthiness Permit;
Issuance of Certificate of Right to Own of Condominium Unit, the basis of certificate issuance is the information provided in deed of separation which already approved by Regional Government. In general, this certificate consists of the copies of book of land of right to own of condominium unit, measurement letter of common land and blueprint of condominium unit which clearly shows the location of condominium unit and its detail of division (pertelaan) on the amount of common facility, common equipment and common land which constitute as an integral and inseparable part.
Furthermore, according to Regulation of Head of the National Land Agency Number 4 Year 1989 on Form and Procedure for Book of Land and Issuance of Certificate of Right to Own of Condominium Unit, after the Certificate of Right to Own of Condominium Unit is issued, the land certificate must be deposited in the Land Office.
Jerry Shalmont
This government regulation regulates a legal action by the parties who are related to the revocation of the right of land and the objects over a land. The parties are able to appeal to high court according to indemnity decision which is not suitable, within 1...
This Agrarian State Minister Regulation explains about the requirements of residences ownership by foreigners, within the frameworks of the implementation of the Government Regulation Number 41 Of 1996 On Residences Ownership by the Foreigners Who Are Domiciled in Indonesia (the “GR No. 41 of 1996”). The Foreigners on GR No. 41 of 1996 are the foreigners who own and maintain the economic interests in Indonesia by implementing an investment to have a residential in Indonesia.
The Government of Indonesia has been trying to find a way to provide more flexibility for a foreigner and foreign entity to own a property in Indonesia. One of the intentions is also to improve the property market in Indonesia. At this moment, the Government has been...
Background In December 1960, Indonesian Government declared the Law Number 5 of 1960 on the Principle Provisions of Agrarian (the “Agrarian Law”) as the principles legal provisions of land in Indonesia. The Agrarian Law is the principle and basic provisions of the...
Batam has a strategic geographical location as the closest island to Singapore and Malaysia, which strategically located in the international shipping route. As the special zone for multinational trade area, Batam has a special treatment from the Government of Indonesia. This specialization can be seen from the several regulations on Batam status, which are as follows:
Batam Island as the business area of Bonded Warehouse regulated in the Presidential Decree of Republic of Indonesia Number 41 of 1978 as amended lastly by the Presidential Decree of Republic of Indonesia Number 25 of 2005.Batam, Rempang and Galang (which also declared as an Industrial area), is developed to serve several main functions, namely: industrial, warehouse, trade, and transshipment.
Free Trade and Free Port Zone regulated in the Government Regulation Number 46 of 2007 on the Free Trade Zone and Free Port Zone Batam.Batam has been determined as a Free Trade Zone (“FTZ”) and Free Port Zone (“FPZ”) which it gives the guarantee and the protection for all investors to conduct their business in Batam.
Tax liberation regulated in the Government Regulation Number 2 of 2009.Batam was not only determined as place of warehousing, but also for place of processing with the liberation for Import Duties (Bea Masuk), Customs and Excise (Bea Cukai), Value Added Tax (PPN), and Luxury Goods Tax (PPnBM) which can be enjoyed by the entrepreneur who has obtained permission in Batam.
Economic Cooperation regulated in Joint Statement by the President of the Republic of Indonesia and the Prime Minister of the Republic of Singapore.On June 25, 2006, the President of Republic of Indonesia and the Prime Minister of Republic of Singapore committed the joint statement of the Framework Agreement on Economic Cooperation between the Government of the Republic of Indonesia and the Government of the Republic of Singapore in the Islands of Batam, Bintan and Karimun.
The stipulations of Batam in becoming a free trade area have been attracting the investors both of foreign and local investors. A large amount in the investment flows on Batam also gives a large impact in some businesses in Batam. With regards to the development of Batam island as a FTZ and FPZ, Batam would need a high-quality infrastructure for supporting the investment development; such as residential, entertainment facilities and other supporting facilities. Furthermore, one of the potential businesses in Batam is in the property area.
The great amount of business opportunities in Batam invites many entrepreneurs to establish their business in Batam. There are new properties projects in Batam, with many types and segmentation, such as:
1. Very low-class and middle-class housing development;
2. Low-class houses;
3. Middle-class apartment;
4. The trade center;
5. Luxurious trade center and a high-class apartment in the certain location;
6. Condominiums.
In order to maintain the local and foreign investment in Batam, the Government always assures the legal certainty in the use of property services. There are a several Government Regulations to support the investment itself, which are as follows:
The Government Regulation Number 46 of 2007 on Batam Free Trade zone and Free Port Zone On the Management and the Usage of Land in the Industrial Area of Batam Island;In this regulation, the Government gives the authority to Free Trade Zone and Free Port Zone Management Body (Badan Pengelolaan Kawasan Perdagangan Bebas dan Pelabuhan Bebas) for developing investment, including regulating the allocated land permit or business permit.
The Government Regulation Number 40 of 1996 on Right to Cultivate, Right to Build and Right to Use of Land and the Government Regulation No. 41 of 1996 about residences ownership by foreigners who are domiciled in Indonesia;
Regulation of State Minister of Agrarian/Head of National Land Authority No. 8 of 1996 about changes on Regulation of State Minister of Agrarian/Head of National Land Authority No. 7 of 1996 about the conditional residences ownership by foreigners who are domiciled in Indonesia.
Circular letter of State Minister of Agrarian/ Head of National Land Authority No. 110 –2871 of 1996 about the implementation of Government Regulation Number 41 of 1996.
The Government determines the rights of land which can be owned by foreigner who wish to stay in Batam in order to maintain and manage their investment.
All of these things reflect the commitment of the Indonesian government to fully support the development of Batam island. The development of Batam Island as FTZ and FPZ also make Batam one of a strategic investment area on property and real estate projects in Indonesia.
Grace Tobing
The purpose of the Government Regulation No. 41 of 1996 (the “GR No. 41”) is to give a legal certainty for foreigners who own property in Indonesia. Foreigners who are domiciled in Indonesia are foreigners who give benefits for national development.
The requirements of property ownership by foreigners who are domiciled in Indonesia are as follows:
1. Property which is built on a land:
Having a Right to Use (Hak Pakai) over a state land;
Having a Right to Use which based on an agreement between the foreigner and the holder of rights over land (for example: Rights to Own or Rights to Build)
2. Strata title units which are built on a land with Right to Use over a state land.
The agreement between foreigner and the owner of the land must be made in writing, with a deed made by a land official (Pejabat Pembuat Akta Tanah), registered in the book of land (Buku Tanah) and certificate of Right to Use. According to the Law of Principles of Agraria, the agreement between foreigner and the owner of the land is not a lease agreement or cultivated agreement. The agreement is made with the terms agreed by the parties but shall not exceed 25 (twenty five) years time period. The term of the agreement can be extended with a new agreement which shall not exceed another 25 (twenty five) years time period, provided that the foreigner is still domiciled in Indonesia.
If the foreigner is no longer domiciled in Indonesia, in a period of one year, the foreigner must release or transfer their rights over the property to other who is eligible. If the foreigner did not release or transfer it, then the state will take over and sell it through a tender. For property which is built over a land owned according to an agreement with the owner of the land, then the property will belong to the owner of the land. The results from the tender of house and land held by the Government will be returned to the foreigner after deducted by tender fee, stuffs and other fee.
Handy Samot