After the promulgation of Law Number 11 of 2020 on Job Creation which has been revoked by Government Regulation in Lieu of Law Number 2 of 2022 on Job Creation (“Job Creation Law“), there are several new provisions in the field of land. One of them is about agency in the form of land bank as stipulated under Article 125 of Job Creation Law. To further regulate the land bank agency, the Government issued Government Regulation No. 64 of 2021 on the Land Bank Agency (“GR 64/2021“).

The land bank agency or land bank is a special agency (sui generis) which is an Indonesian legal entity formed by the central government that is given special authority to manage the land.1The land bank is responsible to the president through the committee.2

The special authority of the land bank is to ensure the availability of land to create a fair economy, which for (a) the public interest; (b) social interest; (c) national development interest; (d) economic equality; (e) land consolidation; and (f) agrarian reform.3

The Function of the Land Bank

The land bank has the following functions:4

  1. Planning
    Planning which is carried out by the land bank includes long-term plan, medium-term plan and annual plan.5 The planning is based on the national medium-term development plan and the spatial plan.6
  2. Land acquisition
    Land acquisition made by the land bank is derived by land as a result of government’s determination and/or land from other parties.7
  3. Land procurement
    Land procurement is carried out by the land bank through the mechanism of land procurement stage for development for the public interest or direct land procurement.8
  4. Land management
    Land management by the land bank consists of land development activities, maintenance, land security and land control.9
  5. Land use
    Land utilization is carried out by the land bank through utilization cooperation with other party in the form of sale and purchase, rent, business cooperation, grant, exchange, and other forms agreed with other parties.10
  6. Land distribution
    Land distribution is an activity of providing and dividing land.11
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The Duties of the Land Bank

The land bank has the following duties:12

  1. planning long-term, medium-term, and annual activity;
  2. acquiring land that can be sourced from the determination of the government and other parties;
  3. procuring land for development in the public interest or direct land acquisition;
  4. conduct land management of development, maintenance and security activity, and land control;
  5. utilization of land through utilization cooperation with other party; and
  6. distributing land by providing and dividing land.

Land Rights of the Land Bank

Land managed by the land bank is granted as right of management in accordance with the provision of the laws and regulations.13 Land right on such right of management can be given the right to cultivate, right to build and right to use.14 These land rights can be secured with mortgage right.15

The land bank may make the transfer and/or use parts of the right of management to other party by agreement.16 In providing guarantees of extension and renewal of land rights over right of management, the land bank relies on the terms contained in the agreement.17

For the structure and operation of the land bank agency, it is further regulated under the Presidential Regulation No. 113 of 2021 on Structure and Operation of the Land Bank Agency.

Closing

The GR 64/2021 is the legal basis for the Land Bank Agency in Indonesia as one of the agrarian reform efforts and improvement of land governance in Indonesia.

Alya Batrisiya

Sources

  1. Article 1 point 1 GR 64/2021
  2. Article 2 paragraph (3) GR 64/2021
  3. Article 2 paragraph (2) GR 64/2021
  4. Article 3 paragraph (1) GR 64/2021
  5. Article 5 paragraph (1) GR 64/2021
  6. Article 5 paragraph (5) PP 64/2021
  7. Article 6 GR 64/2021
  8. Article 9 GR 64/2021
  9. Article 10 GR 64/2021
  10. Article 14 paragraph (2) GR 64/2021
  11. Article 15 paragraph (1) GR 64/2021
  12. Article 3 paragraph (2) GR 64/2021
  13. Article 40 paragraph (1) GR 64/2021
  14. Article 40 paragraph (2) GR 64/2021
  15. Article 40 paragraph (8) GR 64/2021
  16. Article 40 paragraph (3) GR 64/2021
  17. Article 40 paragraph (5) GR 64/2021
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