President Joko Widodo signed off on Government Regulation No. 24 of 2016on the Amendment to Government Regulation No. 37 of 1998on Land-Deed Officials (Pejabat Pembuat Akta Tanah - PPAT) on 22 June 2016, which officially introduces several new provisions that were not incorporated into its predecessor. One of the main policies introduced under the new 2016 PPAT Regulation is the enlargement of PPAT working areas, which now covers entire provinces. Previously, PPAT working areas were limited to regencies and cities.
Habib Adjie, a senior notary and PPAT from Surabaya, claims that the enlargement of PPAT working areas to the level of whole provinces could prove disadvantageous to PPATs. The enlargement of these working areas should potentially create more business opportunities for PPATs, however Mr. Adjie believes that a substantial number of technical issues will have to be faced by PPATs when they engage with this new policy.
“I would like to remind all Indonesian PPATs to not become overly enthusiastic about the new policy. It would be better if we criticize it [the policy] objectively first,” Mr. Adjie asserted to hukumonline on Thursday, 14 July 2016.
Furthermore, Mr. Adjie’s also stressed that three potential problems would have to be faced by any PPATs which were intending to expand their businesses into new working areas within a province. Firstly, there could be difficulties establishing connections with the National Land Agency as it governs over a city or regency. For example, PPATs operating in City X can easily inspect a land deed via the local National Land Agency’s online database system, because they have a registered ID as well as the password needed to access it. However, PPATs from other cities or regencies located within the same province will not have the relevant ID and password needed in order to access City X’s online database, because they are not registered as PPATs with the National Land Agency office in City X.
“Here in Surabaya, PPATs registered with the Surabaya National Land Agency have access to the National Land Agency’s online database for the purpose of inspecting any land deed. If, for example, a PPAT from Banyuwangi is working on a land transaction located in Surabaya, then how will he or she be able to perform the relevant land-deed inspection?” Mr. Adjie asserted.
A second potential problem revolves around the issue of taxation. Mr. Adjie asserted that PPATs may also experience difficulties when dealing with sales and purchase transactions involving tax payments such as Duty on the Acquisition of Rights to Land and Buildings (Bea Perolehan Hak Atas Tanah dan Bangunan - BPHTB), which is determined based on Tax Object Acquisition Value (Nilai Perolehan Objek Pajak - NPOP) and Tax Object Sale Value (Nilai Jual Objek Pajak - NJOP). Crucial here is the fact that the exact amount of NJOP differs in each city or regency.
“The BPHTB tax is unique in each and every city and regency. Are you willing to establish a transaction in Surabaya but pay the tax in, for example, Banyuwangi? Ultimately, the payment must be submitted to the respective regional government [Surabaya in this case],” Mr. Adjie stated.
A third and final issuerelates to ethical behavior. Despite the regulatory framework which allows PPATs to engage in so-called “cross-border business within a single province”, Mr. Adjie suggests that PPATs operating within the same province should be willing to share “the cake” as he puts it. Mr. Adjie is of the opinion that PPATs accepting clients from all of the cities and regencies within a given province is an ethical issue, despite the fact that such PPATs would not be violating any prevailing laws and regulations.
“It is better for us [PPATs] to share this ‘cake’ called the working-area enlargement, despite being granted a new working area which covers an entire province. It is good that we have a larger working area, however it is best to look critically at whether this new policy can make either a positive or a negative contribution in the future,” Mr. Adjie concluded.
Also commenting on this issue, Aslan Noor, the Director of the State Land Utilization Organization at the Ministry of Agrarian Affairs and Spatial Planning/National Land Agency asserted that his institution was currently preparing a number of technical guidelines for the implementation of the 2016 PPAT Regulation. Mr. Noor also asserted that the deliberation and formulation of these technical guidelines were still awaiting official instruction from Ferry Mursyidan Baldan, the Minister of Agrarian Affairs and Spatial Planning and Head of the National Land Agency.
“[The technical guidelines] are still in the deliberation stages and have not been issued. We are currently awaiting instruction from Minister Baldan,” Mr. Noor claimed via a telephone interview with hukumonline.
According to hukumonline research, at least eight technical guidelines need to be stipulated under a number of Ministerial Regulations. These matters encompass the detailed requirements which must be satisfied in order to become a PPAT (Article 6), the extension of the terms of office and reinstatement of PPATs (Article 9), the dismissal of PPATs (Article 10), PPAT working areas (Article 12), procedures and requirements for applications for domicile or working-area replacements (Article 13), administrative sanctions (Article 32), as well as procedures for development and supervision by the Minister of Agrarian Affairs and Spatial Planning/Head of the National Land Agency (Article 33).
Commenting on this particular matter, Mr. Adjie asserted that there was no need to formulate so many separate Ministerial Regulations for each of the above areas. Instead, Mr. Adjie suggested that a single regulation be formulated which encompasses all eight areas. Mr. Adjie concluded by claiming that he was not fond of any “all-embracing” regulation that would need to be further clarified by many separate technical guidelines.
President Joko Widodo signed off on Government Regulation No. 24 of 2016on the Amendment to Government Regulation No. 37 of 1998on Land-Deed Officials (Pejabat Pembuat Akta Tanah - PPAT) on 22 June 2016, which officially introduces several new provisions that were not incorporated into its predecessor. One of the main policies introduced under the new 2016 PPAT Regulation is the enlargement of PPAT working areas, which now covers entire provinces. Previously, PPAT working areas were limited to regencies and cities.
Habib Adjie, a senior notary and PPAT from Surabaya, claims that the enlargement of PPAT working areas to the level of whole provinces could prove disadvantageous to PPATs. The enlargement of these working areas should potentially create more business opportunities for PPATs, however Mr. Adjie believes that a substantial number of technical issues will have to be faced by PPATs when they engage with this new policy.
“I would like to remind all Indonesian PPATs to not become overly enthusiastic about the new policy. It would be better if we criticize it [the policy] objectively first,” Mr. Adjie asserted to hukumonline on Thursday, 14 July 2016.
Furthermore, Mr. Adjie’s also stressed that three potential problems would have to be faced by any PPATs which were intending to expand their businesses into new working areas within a province. Firstly, there could be difficulties establishing connections with the National Land Agency as it governs over a city or regency. For example, PPATs operating in City X can easily inspect a land deed via the local National Land Agency’s online database system, because they have a registered ID as well as the password needed to access it. However, PPATs from other cities or regencies located within the same province will not have the relevant ID and password needed in order to access City X’s online database, because they are not registered as PPATs with the National Land Agency office in City X.
“Here in Surabaya, PPATs registered with the Surabaya National Land Agency have access to the National Land Agency’s online database for the purpose of inspecting any land deed. If, for example, a PPAT from Banyuwangi is working on a land transaction located in Surabaya, then how will he or she be able to perform the relevant land-deed inspection?” Mr. Adjie asserted.
A second potential problem revolves around the issue of taxation. Mr. Adjie asserted that PPATs may also experience difficulties when dealing with sales and purchase transactions involving tax payments such as Duty on the Acquisition of Rights to Land and Buildings (Bea Perolehan Hak Atas Tanah dan Bangunan - BPHTB), which is determined based on Tax Object Acquisition Value (Nilai Perolehan Objek Pajak - NPOP) and Tax Object Sale Value (Nilai Jual Objek Pajak - NJOP). Crucial here is the fact that the exact amount of NJOP differs in each city or regency.
“The BPHTB tax is unique in each and every city and regency. Are you willing to establish a transaction in Surabaya but pay the tax in, for example, Banyuwangi? Ultimately, the payment must be submitted to the respective regional government [Surabaya in this case],” Mr. Adjie stated.
A third and final issuerelates to ethical behavior. Despite the regulatory framework which allows PPATs to engage in so-called “cross-border business within a single province”, Mr. Adjie suggests that PPATs operating within the same province should be willing to share “the cake” as he puts it. Mr. Adjie is of the opinion that PPATs accepting clients from all of the cities and regencies within a given province is an ethical issue, despite the fact that such PPATs would not be violating any prevailing laws and regulations.
“It is better for us [PPATs] to share this ‘cake’ called the working-area enlargement, despite being granted a new working area which covers an entire province. It is good that we have a larger working area, however it is best to look critically at whether this new policy can make either a positive or a negative contribution in the future,” Mr. Adjie concluded.
Also commenting on this issue, Aslan Noor, the Director of the State Land Utilization Organization at the Ministry of Agrarian Affairs and Spatial Planning/National Land Agency asserted that his institution was currently preparing a number of technical guidelines for the implementation of the 2016 PPAT Regulation. Mr. Noor also asserted that the deliberation and formulation of these technical guidelines were still awaiting official instruction from Ferry Mursyidan Baldan, the Minister of Agrarian Affairs and Spatial Planning and Head of the National Land Agency.
“[The technical guidelines] are still in the deliberation stages and have not been issued. We are currently awaiting instruction from Minister Baldan,” Mr. Noor claimed via a telephone interview with hukumonline.
According to hukumonline research, at least eight technical guidelines need to be stipulated under a number of Ministerial Regulations. These matters encompass the detailed requirements which must be satisfied in order to become a PPAT (Article 6), the extension of the terms of office and reinstatement of PPATs (Article 9), the dismissal of PPATs (Article 10), PPAT working areas (Article 12), procedures and requirements for applications for domicile or working-area replacements (Article 13), administrative sanctions (Article 32), as well as procedures for development and supervision by the Minister of Agrarian Affairs and Spatial Planning/Head of the National Land Agency (Article 33).
Commenting on this particular matter, Mr. Adjie asserted that there was no need to formulate so many separate Ministerial Regulations for each of the above areas. Instead, Mr. Adjie suggested that a single regulation be formulated which encompasses all eight areas. Mr. Adjie concluded by claiming that he was not fond of any “all-embracing” regulation that would need to be further clarified by many separate technical guidelines.