Indonesian Property Law
Property Law in Indonesia is a series or set of rules that govern the control of land and / or buildings in Indonesia. It relates to leasing, buying and selling. Legal sources include the Civil Code, Law No. 5 of 1960 on Basic Regulations on Land Principles. For some regions in Indonesia, Common Law (Adat) still applies.
According to the law, there are five specific types of property rights:
1. Freehold (Hak Milik)
2. Building Rights Title (Hak Guna Bangunan)
3. Cultivations Right Title (Hak Guna Usaha)
4. Right of Use (Hak Pakai)
5. Leasehold (Hak Sewa)
Freehold is used for residential or commercial space, primarily residential property, and has unlimited ownership. Land can only be owned by an Indonesian person and, to a limited extent, an Indonesian legal person, according to property rights.
Building Rights Title gives the right to build and own buildings on a plot of land, which is permitted for Indonesian citizens and for an Indonesian legal person. Foreign investment company (Penanaman Modal Asing - PMA) falls under the category of legal entities residing in Indonesia.
Cultivations Right Title is used for plantation, fishing or animal husbandry purposes and is reserved for Indonesian citizens.
Right to Use is the right to use or to cultivate the land owned by the State or a private individual. According to the implementing regulations, the right of use can be granted for a maximum of 25 years and must be set up again for a renewal. This process is the same for Indonesians, foreigners, Indonesian and foreign legal entities.
Leasehold is divided into two types, leasehold for land and leasehold for buildings.
Please note that the material on our website is for informational purposes only and should not be construed as a legal opinion or legal advice.
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