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Ada Pertanyaan? Hubungi Kami Marcell Sihombing, Rofiq Hidayat, Hasyry Agustin
Foreign Citizen in Indonesia. Photo by: RES
The issuance of Government Regulation No. 103 of 2015 on the Ownership of Property by Foreign Nationals Domiciled in Indonesia (2015 Regulation) has very quickly become the center of attention. Some believe that the legislation runs counter to the ongoing campaign for land reform, while others assert that the 2015 Regulation does not offer any significant advantages to foreigners who are looking to own property in Indonesia.
According to Fadli Zon, Vice-Speaker of the House of Representatives (House), the 2015 Regulation is in direct contradiction with the country’s spirit of land-reform, to the point of totally negating it altogether. Mr. Zon asserts that the current government is being too ambitious in its bid to boost economic growth in the country, and that this has resulted in a tendency to introduce illogical and unsynchronized policies, with little consideration being paid to any long-term consequences.
Mr. Zon further cited Article 2 (1) and Article 6 (2) of the 2015 Regulation that allows for foreign citizens to acquire property in Indonesia under the right-to-use category of land title for up to 20 years. Zon questions the basis for this lengthy extension period, which will allow foreign citizens to own property in Indonesia for two decades.
“If we compare this with the provisions set out under Government Regulation No. 40 of 1996, a right-to-use title for state-owned or privately-owned land can only be granted for a maximum period of 25 years,” Mr. Zon stated.
Mr. Zon also compared the 2015 Regulation with Law No. 25 of 2007 on Investment, which grants right-to-use for a maximum period of 70 years for the purposes of investment, and expressed his confusion regarding these different time periods.
Mr. Gunawan, Head of the Advisory Committee for the Indonesian Human Rights Committee for Social Justice (IHCS), proffered a different view from that of Mr. Zon. According to Gunawan, allowing foreign citizens to own property in Indonesia through the right-to-use land title does not contradict the 1945 Constitution or the country’s Agrarian Law. If foreigners were allowed to own property under freehold-estate land titles, then this could be a problem, however this is not the case under the new regulation.
However, Mr. Gunawan bemoaned the absence of a provision in the 2015 Regulation detailing the price, land size, and amount of property that can be acquired by foreign citizens. It is Mr. Gunawan’s belief that this could lead to unfair practices whereby foreign citizens are able to acquire cheap property, while most Indonesian citizens still struggle to make such purchases.
“A restriction is essential in order to prevent the mass ownership of land by foreign citizens, which will ultimately turn land into an object of financial speculation,” concluded Mr. Gunawan.
Mixed Marriages: Unresolved Problems
From another perspective, the 2015 Regulation also fails to offer legal certainty for mixed-marriage couples.The 2015 Regulation stipulates that any property owned by a mixed-marriage couple does not constitute joint matrimonial property that must be proven through a notarized asset-separation agreement.
Rulita Anggraini from the Indonesia Advocacy Team for Mixed Marriages (Tim Advokasi Perkawinan Campuran – PerCa Indonesia) laid out three main issues that still need to be addressed. Firstly come asset-separation agreements between spouses and whether they are only used for the purposes of verification. In other words, will a spouse be required to submit and show the agreement when purchasing or selling properties?
“For example, if I want to sell my land, then do I have to show the agreement if my husband is a foreign national? Does this mean that I don’t need to show the agreement when purchasing property? If this is the case then why do notaries currently refuse to proceed with the transaction because my husband is a foreigner when I want to purchase a property? Who do these asset-separation agreements ultimately serve?” explained Mrs. Anggraini to hukumonline from her Tebet office in Jakarta on Tuesday, 19 January 2016.
Secondly, there is an unclear provision on the validity period of any asset-separation agreement “If I draw up an agreement with a notary right now, then does that mean that it applies retroactively for preexisting transactions that have already happened in the past. After all, these agreements are meant to be used as verification documents,” asked Mrs. Anggraini.
Thirdly, what regulatory framework is to be used when drawing up asset-separation agreements? Mrs. Anggraini believes that the 2015 Regulation should clearly stipulate whether the agreement must be made before or during marriage.
“What regulation should we be referring to when drawing up any asset-separation agreement? Is it Law No. 1 of 1974 on Marriage (Marriage Law), the Indonesian Civil Code, or maybe another regulation? If the asset-separation agreement is referred to in a pre-nuptial agreement, then it can only be drawn up prior to marriage. As far as I know, the drawing up of an agreement between spouses after marriage should be performed based on the freedom-of-contract principle and must be registered with a court so that such an agreement is officially acknowledged and becomes enforceable,” added Mrs. Anggraini.
Mrs. Anggraini further revealed that her institution, PerCa Indonesia, had already sent a letter to the Minister of Law and Human Rights, Yasonna Laoly, seeking further clarification on these matters. She added that the 2015 Regulation could offer the legal certainty that was necessary for mixed-marriage couples, but only if it was implemented clearly and in a way that dealt with these three issues.
“The 2015 Regulation indeed represents a breakthrough, however it has yet to tackle the most fundamental issues and its provisions are discriminatory for us [mixed-marriage couples],” Mrs. Anggraini concluded.
(rfs/sp)
Marcell Sihombing, Rofiq Hidayat, Hasyry Agustin
Foreign Citizen in Indonesia. Photo by: RES
The issuance of Government Regulation No. 103 of 2015 on the Ownership of Property by Foreign Nationals Domiciled in Indonesia (2015 Regulation) has very quickly become the center of attention. Some believe that the legislation runs counter to the ongoing campaign for land reform, while others assert that the 2015 Regulation does not offer any significant advantages to foreigners who are looking to own property in Indonesia.
According to Fadli Zon, Vice-Speaker of the House of Representatives (House), the 2015 Regulation is in direct contradiction with the country’s spirit of land-reform, to the point of totally negating it altogether. Mr. Zon asserts that the current government is being too ambitious in its bid to boost economic growth in the country, and that this has resulted in a tendency to introduce illogical and unsynchronized policies, with little consideration being paid to any long-term consequences.
Mr. Zon further cited Article 2 (1) and Article 6 (2) of the 2015 Regulation that allows for foreign citizens to acquire property in Indonesia under the right-to-use category of land title for up to 20 years. Zon questions the basis for this lengthy extension period, which will allow foreign citizens to own property in Indonesia for two decades.
“If we compare this with the provisions set out under Government Regulation No. 40 of 1996, a right-to-use title for state-owned or privately-owned land can only be granted for a maximum period of 25 years,” Mr. Zon stated.
Mr. Zon also compared the 2015 Regulation with Law No. 25 of 2007 on Investment, which grants right-to-use for a maximum period of 70 years for the purposes of investment, and expressed his confusion regarding these different time periods.
Mr. Gunawan, Head of the Advisory Committee for the Indonesian Human Rights Committee for Social Justice (IHCS), proffered a different view from that of Mr. Zon. According to Gunawan, allowing foreign citizens to own property in Indonesia through the right-to-use land title does not contradict the 1945 Constitution or the country’s Agrarian Law. If foreigners were allowed to own property under freehold-estate land titles, then this could be a problem, however this is not the case under the new regulation.
However, Mr. Gunawan bemoaned the absence of a provision in the 2015 Regulation detailing the price, land size, and amount of property that can be acquired by foreign citizens. It is Mr. Gunawan’s belief that this could lead to unfair practices whereby foreign citizens are able to acquire cheap property, while most Indonesian citizens still struggle to make such purchases.
“A restriction is essential in order to prevent the mass ownership of land by foreign citizens, which will ultimately turn land into an object of financial speculation,” concluded Mr. Gunawan.
Mixed Marriages: Unresolved Problems
From another perspective, the 2015 Regulation also fails to offer legal certainty for mixed-marriage couples.The 2015 Regulation stipulates that any property owned by a mixed-marriage couple does not constitute joint matrimonial property that must be proven through a notarized asset-separation agreement.
Rulita Anggraini from the Indonesia Advocacy Team for Mixed Marriages (Tim Advokasi Perkawinan Campuran – PerCa Indonesia) laid out three main issues that still need to be addressed. Firstly come asset-separation agreements between spouses and whether they are only used for the purposes of verification. In other words, will a spouse be required to submit and show the agreement when purchasing or selling properties?
“For example, if I want to sell my land, then do I have to show the agreement if my husband is a foreign national? Does this mean that I don’t need to show the agreement when purchasing property? If this is the case then why do notaries currently refuse to proceed with the transaction because my husband is a foreigner when I want to purchase a property? Who do these asset-separation agreements ultimately serve?” explained Mrs. Anggraini to hukumonline from her Tebet office in Jakarta on Tuesday, 19 January 2016.
Secondly, there is an unclear provision on the validity period of any asset-separation agreement “If I draw up an agreement with a notary right now, then does that mean that it applies retroactively for preexisting transactions that have already happened in the past. After all, these agreements are meant to be used as verification documents,” asked Mrs. Anggraini.
Thirdly, what regulatory framework is to be used when drawing up asset-separation agreements? Mrs. Anggraini believes that the 2015 Regulation should clearly stipulate whether the agreement must be made before or during marriage.
“What regulation should we be referring to when drawing up any asset-separation agreement? Is it Law No. 1 of 1974 on Marriage (Marriage Law), the Indonesian Civil Code, or maybe another regulation? If the asset-separation agreement is referred to in a pre-nuptial agreement, then it can only be drawn up prior to marriage. As far as I know, the drawing up of an agreement between spouses after marriage should be performed based on the freedom-of-contract principle and must be registered with a court so that such an agreement is officially acknowledged and becomes enforceable,” added Mrs. Anggraini.
Mrs. Anggraini further revealed that her institution, PerCa Indonesia, had already sent a letter to the Minister of Law and Human Rights, Yasonna Laoly, seeking further clarification on these matters. She added that the 2015 Regulation could offer the legal certainty that was necessary for mixed-marriage couples, but only if it was implemented clearly and in a way that dealt with these three issues.
“The 2015 Regulation indeed represents a breakthrough, however it has yet to tackle the most fundamental issues and its provisions are discriminatory for us [mixed-marriage couples],” Mrs. Anggraini concluded.
(rfs/sp)