Legal Aspect of the Grant of Right to Build or Right of Use Over the Right of Ownership Land - Indonesia
July 5, 2012 By Leks & Co
Under Article 35 paragraph (1) of Law Number 5 of 1960 on the Principle Provisions of Agrarian (“Agrarian Law”), it is stated as follows: “Right to Build is right to establish and to have buildings over land that is not his own, with a maximum period of 30 years.”
Right to build (“HGB“) may be extended with a maximum period of 20 years as a request from right’s holder and bearing in mind the need and state of buildings. Subject who can be the holder of HGB is an Indonesian citizen or legal entity that is established under Indonesian law and domiciled in Indonesia. Legal entity is an institution that is given a status as legal entity, such as the Limited Liability Company, Cooperative, the Association of Unit Owners and Occupants of the Condominium, and the Foundation.
According to the Government Regulation of Republic of Indonesia Number 40 of 1996 on Right to Cultivate, Right to Build, and Right of Use Over Land (“GR No. 40/1996”), the granting of HGB over a right of ownership is performed by the holder of right of ownership through a deed made by Land Conveyancing Officer (“Pejabat Pembuat Akta Tanah/ PPAT”). The granting of HGB over a Right of Ownership is made by an agreement between the holder of Right of Ownership and the prospective holder of HGB which is stated in the deed that is made by PPAT. The granting of HGB over a right of ownership shall be registered at the Land Office (Kantor Pertanahan). The period of HGB that is issued over the right of ownership is maximum 30 (thirty) years and may be renewed with the new provision of HGB based on the agreement that is implemented on the deed which is made by PPAT and the respective right to build shall be registered in the local land office (kantor pertanahan setempat).
Under Article 41 of Agrarian Law, it is stated as follows:
“Right of Use is the right to use and/or collect the results of the land that is directly controlled by the State or land owned by others, who gives the authority and duties which is specified in the decision by the competent official or in an agreement with the owner of the land, which is not a lease agreement or the agreement to cultivate a land, all things that are not contrary to the spirit and provisions of this law.”
The granting of Right of Use over Right of Ownership is performed by the holder of Right of Ownership through a deed made by Land Conveyancing Officer (“Pejabat Pembuat Akta Tanah/ PPAT”). The granting of right of use over the right of ownership shall be registered on the land book in the Land Office. The right of use over the right of ownership also binds the third party since it is registered. The period of the right of use over the right of ownership is maximum 25 (twenty five) years and it cannot be extended. Right of use over the right of ownership may be renewed with the new provision of right of use based on an agreement between the holder of right of use and the holder of right of ownership, as implemented on the deed which is made by PPAT and shall be registered on the local land office.
ABOUT THE AUTHOR: Alsha Alexandra Kartika
Leks & Co are law offices specialized in the real estate law, filled by young, energetic, creative lawyers, providing premium legal services with competitive price plus 7 amazing added values, and delivering our services based on definite core values.
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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
According to the Government Regulation of Republic of Indonesia Number 40 of 1996 on Right to Cultivate, Right to Build, and Right of Use Over Land (“GR No. 40/1996”), the granting of HGB over a right of ownership is performed by the holder of right of ownership through a deed made by Land Conveyancing Officer (“Pejabat Pembuat Akta Tanah/ PPAT”). The granting of HGB over a Right of Ownership is made by an agreement between the holder of Right of Ownership and the prospective holder of HGB which is stated in the deed that is made by PPAT. The granting of HGB over a right of ownership shall be registered at the Land Office (Kantor Pertanahan). The period of HGB that is issued over the right of ownership is maximum 30 (thirty) years and may be renewed with the new provision of HGB based on the agreement that is implemented on the deed which is made by PPAT and the respective right to build shall be registered in the local land office (kantor pertanahan setempat).
Under Article 41 of Agrarian Law, it is stated as follows:
“Right of Use is the right to use and/or collect the results of the land that is directly controlled by the State or land owned by others, who gives the authority and duties which is specified in the decision by the competent official or in an agreement with the owner of the land, which is not a lease agreement or the agreement to cultivate a land, all things that are not contrary to the spirit and provisions of this law.”
The granting of Right of Use over Right of Ownership is performed by the holder of Right of Ownership through a deed made by Land Conveyancing Officer (“Pejabat Pembuat Akta Tanah/ PPAT”). The granting of right of use over the right of ownership shall be registered on the land book in the Land Office. The right of use over the right of ownership also binds the third party since it is registered. The period of the right of use over the right of ownership is maximum 25 (twenty five) years and it cannot be extended. Right of use over the right of ownership may be renewed with the new provision of right of use based on an agreement between the holder of right of use and the holder of right of ownership, as implemented on the deed which is made by PPAT and shall be registered on the local land office.
ABOUT THE AUTHOR: Alsha Alexandra Kartika
Leks & Co are law offices specialized in the real estate law, filled by young, energetic, creative lawyers, providing premium legal services with competitive price plus 7 amazing added values, and delivering our services based on definite core values.
Copyright Leks & Co
More information about Leks & Co
View all articles published by Leks & Co
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.
