Overview

The Draft Bill on Asset Forfeiture (“Draft Bill”) is currently being accelerated for completion, with the House of Representatives (Dewan Perwakilan Rakyat - “DPR”) committing to enact the Draft Bill no later than 15 December 2026.[1] The commitment forms part of the DPR’s efforts to strengthen the eradication of corruption and the recovery of proceeds of crime.[2] DPR leaders have also emphasized that the remaining deliberation period should still be used to carefully examine the substance of the Draft Bill before its targeted enactment.[3]

The accelerated timeline has increased scrutiny over the framework that will ultimately be adopted, particularly regarding transparency, limits on Asset Forfeiture powers and protection of legitimate property rights.[4] Concerns have also emerged regarding substantive elements considered to have been omitted or weakened in more recent formulations of the Draft Bill.[5] Separately, proposals have been raised for the Draft Bill to expressly accommodate illicit enrichment as a mechanism for addressing abnormal increases in wealth suspected of originating from criminal conduct.[6]

As of the date of this analysis, the version of the Draft Bill formally being used in the ongoing deliberations has not been publicly confirmed. For purposes of this analysis, Hukumonline refers to a Draft Bill dated April 2026 (“April Draft Bill”) and a Draft Bill dated July 2026 (“July Draft Bill”), the latter being the latest version available to Hukumonline. Accordingly, this analysis compares the April Draft Bill and the July Draft Bill to identify how the proposed Asset Forfeiture framework has evolved ahead of its targeted enactment.

To facilitate a more comprehensive discussion, the analysis is organized into the following sections:

1. Scope of Asset Forfeiture

1. Assets and Criminal Offenses Subject to Forfeiture
2. Minimum Asset Value, Unexplained Wealth and Proof of Lawful Origin

2. Asset Forfeiture Mechanisms

1. Conviction-Based and Non-Conviction-Based Forfeiture
2. Civil-Law Regime in Asset Forfeiture and Its Relationship with Criminal Proceedings

3. Asset Tracing, Freezing and Seizure

1. Asset Tracing and Access to Information
2. Freezing and Seizure of Assets
3. Urgent Circumstances, Investigator Discretion and Judicial Oversight

4. Evidence and Protection of Rights over Assets

1. Burden and Standard of Proof
2. Protection of Bona Fide Third Parties
3. Objections, Compensation and Legal Remedies

5. Governance of Seized and Forfeited Assets

1. Asset Management Before and After Court Judgment
2. Institutions and Powers of Asset Managers
3. Preservation of Value, Disposal and Management of Special Assets
4. Transparency, Supervision and Accountability

 

I.    Scope of Asset Forfeiture

 

A.   Assets and Criminal Offenses Subject to Forfeiture

The April Draft Bill and the July Draft Bill broadly retain the same core categories of Criminal Assets that may be subject to Asset Forfeiture, including proceeds of crime, Assets used to commit offenses, substitute Assets and found property suspected of originating from criminal conduct.[7] However, the July Draft Bill introduces several material changes concerning both the types of Assets covered and the offenses to which the Asset Forfeiture framework applies.[8]

The principal differences between the two drafts may be summarized as follows:

Category	April Draft Bill	July Draft Bill
Proceeds of crime[9]	Covers Assets obtained directly or indirectly from criminal conduct, including Assets transferred or converted into property belonging to the offender, another person or a corporation, as well as resulting capital, income or economic benefits.	Substantially retained.
Instrumentalities[10]	Covers Assets known or reasonably suspected to have been used to commit an offense.	Expanded to expressly include Assets used to obstruct judicial proceedings.
Substitute Assets[11]	Allows other lawful Assets belonging to the offender to replace Assets that have been declared forfeited.	Retained, but subject to fairness and proportionality in determining the value of the substitute Asset.
Found property[12]	Covers found property known or reasonably suspected to originate from criminal conduct.	Substantially retained.
Unexplained wealth[13]	Expressly recognized as an additional category.	No longer separately regulated.

The Asset categories contemplated under the Draft Bills partly overlap with forfeiture mechanisms already recognized under existing criminal law. Law No. 1 of 2023 on the Criminal Code, which has been amended by Law No. 1 of 2026 on Penal Adjustment (collectively referred to as “KUHP”), recognizes forfeiture as an additional punishment and permits the forfeiture of property used to prepare or commit an offense, property connected with or obtained from an offense, economic benefits derived from an offense and property used to obstruct investigation, prosecution or court proceedings.[14]

It also provides for replacement by an equivalent monetary value where certain property subject to forfeiture cannot be surrendered.[15] Accordingly, some of the Asset categories contemplated under the Draft Bills are not themselves novel. The distinction becomes more significant in relation to the scope and procedural basis through which those Assets may be pursued.

In this regard, the April Draft Bill does not establish a specific category of Economic-Motive Crime. Instead, it generally links forfeitable Criminal Assets to offenses carrying imprisonment of four years or more, together with the applicable Asset-value requirement.[16]

The July Draft Bill moves away from this approach and limits Asset Forfeiture to Economic-Motive Crimes.[17] An Economic-Motive Crime is defined as an offense committed by a person and/or corporation for the purpose of obtaining gain, wealth or economic benefit, directly or indirectly, which causes losses to the state, society or another party and is regulated and punishable under law.[18] The July Draft Bill therefore shifts the relevant inquiry from the level of punishment attached to the underlying offense toward the purpose and economic consequences of the conduct.

Muhammad Fatahillah Akbar, Lecturer at the Faculty of Law, Universitas Gadjah Mada raises a concern regarding this formulation. In his view, the reference to an economic “motive” requires clearer parameters because motive does not necessarily constitute an element of an offense.[19] He further notes that offenses not ordinarily classified as economic crimes may nevertheless generate economic benefits and considers that clearer classification is required to determine which offenses fall within the Asset Forfeiture framework.[20]

The distinction between the two drafts is therefore substantive rather than merely terminological. Under the April Draft Bill, the relevant offense is principally screened through an objective statutory criterion, namely the level of criminal punishment attached to it.[21] Under the July Draft Bill, the assessment instead requires the underlying conduct to satisfy the elements of an Economic-Motive Crime, including the purpose of obtaining economic gain, wealth or benefit and the resulting loss to the state, society or another party.[22]

An offense satisfying the imprisonment threshold under the April Draft Bill would therefore not automatically fall within the July Draft Bill unless the Economic-Motive Crime criteria are also met. Conversely, an offense falling within the Economic-Motive Crime definition may potentially fall within the July framework even if it would not have satisfied the April Draft Bill’s four-year imprisonment threshold, subject to the other applicable requirements for forfeiture.[23]

This distinction is particularly relevant where an offense generates economic proceeds even though obtaining those proceeds is not expressly formulated as an element of the offense. As Akbar observes, the use of “motive” may create interpretive difficulties for precisely this reason.[24] Greater clarity on the economic-purpose requirement would therefore be relevant in distinguishing conduct that merely produces an economic benefit from conduct that qualifies as an Economic-Motive Crime.

The potential reach of the July Draft Bill is also relevant to business actors, as the definition of an Economic-Motive Crime expressly encompasses conduct committed by a person and/or corporation. Accordingly, the Asset Forfeiture framework is not necessarily limited to offenses involving public officials, but may also extend to corporate activities where the applicable elements are satisfied. This may increase the importance of maintaining complete and traceable records concerning the lawful origin, ownership and transfer of Assets, particularly where the relevant business activities are subject to licensing or other regulatory requirements.

 

B.   Minimum Asset Value, Unexplained Wealth and Proof of Lawful Origin

The two drafts also differ materially in the minimum Asset value applicable to NCBF. Under the April Draft Bill, Criminal Assets are generally subject to the Asset Forfeiture framework where their value is at least Rp100 million and they are connected to an offense punishable by imprisonment of four years or more.[25] The July Draft Bill instead requires Criminal Assets subject to NCBF to have a minimum value of Rp1 billion, in addition to satisfying at least one of the specified circumstances in which NCBF may be pursued.[26]

The increase substantially narrows the value range of Assets that may be pursued through NCBF. While a monetary threshold may allow enforcement resources to be concentrated on higher-value Assets, it may also create incentives to divide or structure Assets below the applicable threshold.

Mangatta Toding Allo has questioned reliance on a minimum monetary threshold for this reason. In his assessment, setting a minimum Asset value may create opportunities for avoidance through the fragmentation of Assets.[27] He suggests that the scope of Asset Forfeiture should instead give greater weight to the seriousness and economic character of the underlying offense.[28] Akbar takes a somewhat different position, considering the use of an Asset-value threshold to remain relevant while noting that potential avoidance through Asset fragmentation should remain subject to monitoring.[29]

A more substantial change concerns unexplained wealth. The April Draft Bill expressly extends the Asset Forfeiture framework to Assets that are disproportionate to a person’s income or sources of additional wealth, cannot be proven to have been lawfully acquired and are suspected of being connected to Criminal Assets.[30] These requirements operate cumulatively. Accordingly, a discrepancy between wealth and income alone does not automatically render an Asset subject to forfeiture.

The elucidation further identifies the State Officials’ Wealth Report (Laporan Harta Kekayaan Penyelenggara Negara/LHKPN), Employee Income Tax Report (Laporan Pajak Penghasilan Pegawai/LP2P) and Annual Tax Return (Surat Pemberitahuan Tahunan/SPT) as examples of information that may indicate an imbalance between Assets and identifiable income or sources of wealth.[31]

The July Draft Bill no longer contains an equivalent standalone category of unexplained wealth.[32] Instead, forfeitable Assets are principally identified through their connection with criminal conduct, their use in committing or obstructing an offense, their status as substitute Assets or their status as found property suspected of originating from crime.[33]

Accordingly, the July Draft Bill no longer provides the express route contained in the April Draft Bill for pursuing an Asset on the combined basis that it is materially disproportionate to lawful income, its lawful origin cannot be demonstrated and it is suspected of being connected to Criminal Assets.

Public commentary has separately proposed the express adoption of illicit enrichment. This should be distinguished from the April Draft Bill’s unexplained-wealth formulation, which operates as a category of forfeitable Asset and does not itself use the term illicit enrichment.[34]

Akbar considers unexplained wealth to remain an important component of an effective Asset Forfeiture framework. In his view, the concept is closely connected to a reverse-evidence mechanism under which a materially unexplained Asset may require its holder to provide an explanation regarding its lawful origin.[35] He further notes that, where the origin can be satisfactorily explained, the Asset should be capable of being returned.[36]

His comments do not suggest that all property should automatically become subject to reverse proof. Rather, the obligation to provide an explanation arises in the context of wealth that cannot reasonably be reconciled with the person’s identifiable income or sources of wealth. Akbar also recognizes the practical difficulty of applying such an assessment to persons with variable or complex sources of income, such as business owners, compared with public officials or salaried persons whose income may be more readily identified.[37]

This approach is not entirely unfamiliar to Indonesian law. Under Law No. 31 of 1999 on the Eradication of Corruption Crimes, which has been amended several times, most recently through Law No. 1 of 2026 on Penal Adjustment (collectively referred to as “Law 31/1999”), a defendant is required to provide information regarding relevant property, while an inability to explain wealth that is disproportionate to income or sources of additional wealth may strengthen existing evidence of corruption.[38] Importantly, the Public Prosecutor remains responsible for proving the underlying charge.[39]

Law 31/1999 also contains a more specific reverse-proof mechanism for other property owned by a defendant that has not been included in the charge but is suspected of originating from corruption. Where the defendant cannot prove that such property was not obtained from corruption, the court may order its forfeiture.[40] The existing framework therefore demonstrates a distinction between requiring an explanation regarding the provenance of certain Assets and transferring the entire evidentiary burden for the underlying offense to the Asset holder.

Mangatta nevertheless highlights an important safeguard issue in the April formulation. In his assessment, the Draft Bill does not establish a mathematical formula or sufficiently clear normative parameter for determining when an Asset should be regarded as disproportionate to income.[41] Such uncertainty may widen the interpretive discretion available to law-enforcement authorities, particularly in determining when a discrepancy is sufficiently significant to justify further scrutiny or a reverse-evidence requirement.

This issue also affects the relationship between the initial evidentiary showing by the State and the subsequent obligation of an Asset holder to explain lawful origin. The April formulation requires not only a disparity between the Asset and identifiable income, but also an inability to demonstrate lawful acquisition and a suspected connection with Criminal Assets.[42] The unexplained-wealth mechanism should therefore be distinguished from a presumption that any unexplained increase in wealth is itself sufficient to establish criminal origin.

 

II.  Asset Forfeiture Mechanisms

 

A.   Conviction-Based and Non-Conviction-Based Forfeiture

A principal change introduced by the July Draft Bill concerns the legal mechanism through which Asset Forfeiture may be pursued. The April Draft Bill adopts an NCBF model, under which Asset Forfeiture does not depend on the imposition of a criminal sentence against the offender.[43] Its elucidation expressly characterizes this mechanism as civil forfeiture with an in rem character, meaning that the proceeding is directed against the Asset rather than the individual.[44]

The July Draft Bill instead introduces a dual mechanism by expressly recognizing both CBF and NCBF.[45] Under the CBF route, Asset Forfeiture constitutes an additional criminal sanction imposed together with the principal criminal sanction, and the investigation, prosecution and court examination generally follow the applicable criminal-procedure framework.[46]

This distinction also corresponds with concerns raised during the legislative discussion. Bob Hasan, Chair of the Legislation Committee and Member of Commission III of the DPR, emphasizes that the Draft Bill should clearly determine whether Asset Forfeiture operates as an additional criminal sanction or as a separate mechanism.[47] He considers a conviction-based approach important for legal certainty, while recognizing that a separate mechanism may remain necessary in circumstances where the criminal process cannot proceed, such as where a suspect or defendant has died or absconded.[48]

The July Draft Bill’s hybrid structure may be understood as accommodating both considerations by retaining CBF as part of the criminal process while allowing NCBF in specifically defined circumstances.[49] By contrast, NCBF is initiated through an Asset Forfeiture application submitted by the State Attorney (Jaksa Pengacara Negara - “JPN”) and proceeds under the special procedure established in the Draft Bill.[50]

NCBF under the July Draft Bill is nevertheless available only in specified circumstances, including where the suspect or defendant has died, absconded or cannot be located, suffers from a permanent illness, the criminal case cannot be tried for certain legal reasons, or additional Criminal Assets are discovered after a final and binding conviction.[51]

As discussed in Section I.B above, the July Draft Bill also subjects this mechanism to a substantially higher minimum Asset-value requirement. The July Draft Bill therefore does not abandon NCBF, but places it alongside a CBF mechanism and ties its availability more closely to circumstances affecting the criminal process. This differs from the April Draft Bill, under which Asset Forfeiture itself is conceived from the outset as a mechanism that does not depend on punishment of the offender.[52]

This distinction is central to Akbar’s assessment of the July Draft Bill. In his view, a separate Asset Forfeiture law should principally address NCBF because CBF is already recognized under existing criminal laws, including the KUHP and legislation concerning corruption and money laundering.[53] He considers the principal added value of NCBF to lie in its focus on the Asset rather than the person against whom criminal liability is pursued.[54]

Akbar is particularly critical of the July formulation because the availability of NCBF remains closely linked to the status or circumstances of a suspect or defendant. In his assessment, a mechanism that genuinely focuses on the Asset should not depend primarily on whether a particular person has died, absconded or otherwise cannot proceed through the ordinary criminal process.[55] His statement that the July mechanism is effectively not NCBF should therefore be understood as a conceptual criticism of its person-dependent design, rather than as a description of the July Draft Bill as providing CBF only.[56]

At the same time, the circumstances specified in the July Draft Bill reflect one of the conventional functions of NCBF in asset recovery. Dr. Patris Yusrian Jaya identifies NCBF as particularly relevant to addressing situations in which conventional criminal procedure cannot produce an effective forfeiture outcome, including where an offender has died or remains permanently at large.[57] The July approach therefore preserves an NCBF route for several situations in which obtaining or executing a conviction against the offender may be impracticable.

Prof. Hasbullah, Dean of the Faculty of Law, Universitas Adhyaksa similarly characterizes NCBF as a special mechanism that should operate under limited conditions, with a demonstrable nexus between the Asset and criminal conduct and strong judicial oversight.[58] In his view, the proposed framework should close existing recovery gaps without reducing the safeguards applicable to the protection of property rights.[59]

The distinction between the two drafts consequently concerns not only whether NCBF exists, but also the role assigned to it. Under the April Draft Bill, NCBF constitutes the principal Asset Forfeiture model. Under the July Draft Bill, it operates as one component of a hybrid framework and is activated only where the statutory conditions for proceeding without a criminal judgment are satisfied.

 

B.   Civil-Law Regime in Asset Forfeiture and Its Relationship with Criminal Proceedings

The different treatment of CBF and NCBF also affects the procedural character of Asset Forfeiture. As noted above, the April Draft Bill expressly characterizes Asset Forfeiture as civil forfeiture with an in rem character.[60] Court examination of an Asset Forfeiture application is generally conducted in accordance with the applicable laws and regulations, which the elucidation identifies as those governing civil procedure, unless otherwise provided under the Draft Bill.[61]

The July Draft Bill requires a more differentiated analysis. Its CBF mechanism forms part of the criminal proceeding and constitutes an additional criminal sanction.[62] NCBF, however, follows the special procedural framework established in the Draft Bill, covering Asset tracing, blocking and seizure, case-file preparation, submission of the Asset Forfeiture application, summons, court examination, judgment, execution and legal remedies.[63] Further procedural rules governing Asset Forfeiture applications are expressly contemplated through legislation concerning civil procedure.[64]

The General Elucidation of the July Draft Bill nevertheless describes the Asset Forfeiture mechanism being developed as adopting an in rem method through an NCBF approach.[65] This should be read together with the operative provisions that expressly recognize both CBF and NCBF. Accordingly, the in rem characterization is most directly relevant to the NCBF component of the July framework and should not be understood as converting the CBF route, which remains an additional criminal sanction, into a civil proceeding.

Civil proceedings for the recovery of assets are also not entirely new within Indonesian anti-corruption law. Law 31/1999 permits a civil claim where insufficient evidence exists to establish corruption but an actual state financial loss has been identified, and expressly provides that an acquittal does not extinguish the right to pursue recovery of state financial losses.[66] Civil claims may also be pursued against heirs where a suspect or defendant dies during investigation or trial, as well as against a convicted person or their heirs where additional property suspected of originating from corruption is discovered after a final and binding judgment.[67]

However, the relationship between Asset Forfeiture proceedings and criminal proceedings is structured differently under the two drafts. Under the April Draft Bill, the State may continue to prosecute the offender notwithstanding an Asset Forfeiture proceeding.[68] Where the criminal prosecution concerns the same Asset that is already the object of an Asset Forfeiture application, examination of the Asset Forfeiture proceeding is suspended until the criminal case reaches a final and binding judgment. If that criminal judgment orders the same Asset forfeited to the State, the separate Asset Forfeiture proceeding is terminated.[69]

The July Draft Bill establishes a more specific interaction within its hybrid CBF-NCBF structure. Where a suspect or defendant who had absconded is subsequently apprehended while an NCBF application is pending, the NCBF proceeding is suspended and the criminal process resumes.[70] If that criminal process subsequently results in either an acquittal (putusan bebas) or a discharge from all legal charges (putusan lepas dari segala tuntutan hukum), the pending NCBF proceeding must be terminated.[71]

The treatment of a discharge from all legal charges marks a notable difference from the April Draft Bill. The April Draft Bill expressly recognizes such a decision as one of the circumstances in which Asset Forfeiture may still be pursued.[72] The July Draft Bill removes that ground and, where the criminal process has resumed, requires the NCBF proceeding to end following either an acquittal or a discharge.[73]

Akbar questions treating the two outcomes identically for this purpose. In his view, an acquittal and a discharge from all legal charges have different implications: a discharge may involve conduct that has been established but does not constitute a criminal offense, whereas an acquittal concerns a failure to establish the alleged criminal conduct.[74] He therefore considers that Asset Forfeiture may remain relevant following a discharge in circumstances where another unlawful basis for recovery can still be established.[75]

This difference illustrates the broader tension in the July Draft Bill between maintaining NCBF as an independent Asset-focused mechanism and linking its continuation to developments in the criminal proceeding. The July framework provides clearer coordination between the two tracks, but in certain circumstances the fate of the NCBF proceeding remains directly affected by the status and outcome of the criminal case.

 

III. Asset Tracing, Freezing and Seizure

 

A.   Asset Tracing and Access to Information

Both drafts place the Investigator at the center of the Asset-tracing process and authorize the collection of Documents from persons, government institutions and other relevant institutions.[76] The April Draft Bill expressly identifies the investigators that may exercise these powers, including officials of the Indonesian National Police, Attorney General’s Office, Corruption Eradication Commission, National Narcotics Board and Civil Servant Investigators.[77] The July Draft Bill no longer sets out an equivalent list and instead refers to Investigators as defined under criminal procedural law.[78]

A notable development under the July Draft Bill concerns the role of the institution responsible for financial-transaction analysis. The April Draft Bill permits an Investigator to cooperate with such institution in conducting Asset tracing.[79] The July Draft Bill goes further by authorizing the institution itself to conduct tracing upon the Investigator’s instruction, while retaining the possibility of cooperation with the Investigator.[80] The elucidation identifies the Financial Transaction Reports and Analysis Center (Pusat Pelaporan dan Analisis Transaksi Keuangan - “PPATK”) as the institution contemplated under this provision.[81]

The July Draft Bill also creates a more structured information-gathering process. A person or institution receiving a request for Documents must provide them within three days. If the requested Documents are not held, controlled or available, the recipient must instead provide a written explanation, together with relevant information, within the same period.[82] The April Draft Bill imposes the obligation to provide requested Documents and requires a formal handover record, but does not specify an equivalent response period or procedure where the requested information is unavailable.[83]

Both drafts reinforce these powers through confidentiality-related provisions. Persons and institutions responding to Document requests are prohibited from disclosing the request or submission to other parties, while the obligation to provide Documents applies notwithstanding statutory confidentiality requirements.[84] Both drafts also protect persons or institutions that provide information in good faith, although the July Draft Bill extends such protection to administrative-court claims in addition to civil claims and criminal prosecution.[85]

These tracing powers are significant because Asset recovery frequently depends on information that may be dispersed across financial accounts, ownership records and corporate structures. Patris describes financial tracing as a systematic process of following transaction flows, identifying concealed Assets and determining their beneficial owners.[86] In this regard, the July Draft Bill creates a more direct operational role for PPATK and introduces clearer response obligations for holders of relevant Documents.

Prof. Asep Nana Mulyana, Deputy Attorney General of the Republic of Indonesia similarly emphasizes that modern Asset recovery requires financial analysis, Asset tracing, the ability to examine corporate structures and the identification of beneficial ownership.[87] From this perspective, financial trails form part of the evidentiary pathway for identifying the relationship between criminal conduct, Asset ownership and the movement of value.

However, neither draft expressly establishes a general requirement for prior judicial authorization merely for an Investigator to request Documents during tracing.[88] This differs from the express judicial-authorization requirements applicable to ordinary blocking and seizure. The distinction becomes important where a tracing request involves access to sensitive banking, taxation, corporate or beneficial-ownership information.

Akbar considers judicial control relevant where Asset tracing involves coercive or intrusive measures. In his view, access to such information may be justified once the matter has entered the investigation stage, but coercive measures should remain subject to District Court authorization and the applicable human-rights safeguards.[89] His position therefore points to the need to distinguish ordinary information gathering from forms of access that materially interfere with confidentiality or proprietary rights.

The increasing use of digital and cross-border Assets also expands the practical scope of tracing. Patris specifically identifies crypto and virtual Assets as an emerging asset-concealment issue and refers to the use of controlled crypto wallets in Asset recovery, alongside Mutual Legal Assistance (“MLA”) for tracing and recovering Assets across jurisdictions.[90] These developments make the ability to obtain timely information particularly relevant, while also increasing the importance of procedural safeguards governing access and use of such information.

 

B.   Freezing and Seizure of Assets

Following Asset tracing, both drafts authorize Investigators to impose blocking and/or seizure where the Asset is sufficiently connected to criminal activity.[91] However, the wording of the preliminary threshold differs. The April Draft Bill requires a “strong suspicion” (dugaan kuat) that the Asset falls within the relevant forfeitable categories, whereas the July Draft Bill refers more generally to an Asset that is “suspected” (diduga) of constituting a Criminal Asset.[92]

Textually, the July formulation therefore removes the qualifier requiring the suspicion to be “strong.” The practical significance of this difference will ultimately depend on how the requirement is interpreted and on the evidence supporting the relevant coercive measure. It should also be distinguished from the evidentiary standard ultimately required for Asset Forfeiture, which is discussed separately in Section IV.A.

The ordinary blocking mechanism remains subject to prior District Court authorization under both drafts, but the procedural structure and duration are revised.[93] Under the April Draft Bill, the blocking order is issued by the Investigator’s direct superior after District Court permission has been obtained, and the relevant institution must implement the order upon receipt.[94] Blocking may remain in place for up to 30 days and may be extended once for a further 30 days with court permission.[95]

The July Draft Bill instead requires the Investigator to apply directly to the District Court for a blocking determination. Once granted, the Investigator must submit the blocking order to the relevant institution within one day, and the institution must implement it within one day of receipt.[96] More significantly, the maximum blocking period is reduced to seven days, extendable once for another seven days.[97] If no indication of an Economic-Motive Crime is identified by the end of the applicable period, the blocking expires by operation of law. Where such indication is identified, the Investigator may proceed to seizure.[98]

The seizure procedure is similarly more detailed under the July Draft Bill. Both drafts generally require prior District Court authorization for ordinary seizure.[99] The April Draft Bill requires the Investigator to present a seizure order issued by the Investigator’s direct superior and to prepare a seizure report witnessed by two persons.[100] The July Draft Bill requires the Investigator to present identification and the court-issued seizure authorization, specifies the persons who may witness the seizure and requires the measure to be carried out within 15 days after court authorization is granted.[101]

The July Draft Bill also expressly addresses Assets that cannot practically be blocked because of their nature or form, allowing such Assets to proceed directly to seizure.[102] Its elucidation identifies movable property such as vehicles and immovable property such as land as examples.[103] The April Draft Bill similarly permits blocking and/or seizure, with its elucidation indicating that blocking need not precede seizure where the nature of the Asset does not require it.[104]

Both drafts also contemplate Assets located outside Indonesia. A request for blocking or seizure must first be submitted to the competent authority in the relevant foreign jurisdiction.[105] If the foreign authority rejects the request, the Investigator may instead block or seize other Assets in Indonesia belonging to or controlled by the relevant person, provided that their value is equivalent to that of the Asset sought abroad.[106] The July Draft Bill’s elucidation further indicates that this equivalent value is to be determined by an appraisal team in accordance with applicable laws and regulations.[107]

This substitute mechanism is significant because it reduces the extent to which Asset recovery is entirely dependent on the success of foreign enforcement. At the same time, where recovery is pursued directly against Assets abroad, practical effectiveness continues to depend on international cooperation. Patris identifies MLA as an important instrument for addressing jurisdictional differences and restrictions arising from confidentiality rules in international banking during the recovery and repatriation of Assets.[108]

 

C.   Urgent Circumstances, Investigator Discretion and Judicial Oversight

The most significant procedural addition in the July Draft Bill is the introduction of an express emergency mechanism that permits blocking and seizure to be undertaken without prior District Court authorization.[109] The April Draft Bill does not contain an equivalent exception and instead structures ordinary blocking and seizure around prior judicial permission.[110]

For blocking, the July Draft Bill permits the prior-authorization requirement to be bypassed in urgent circumstances, including where there is a risk that Assets will be transferred, where an offense concerns information and electronic transactions, where there has been conspiracy in organized crime, or where urgency arises from circumstances assessed by the Investigator.[111] The Investigator must subsequently seek approval from the Chief Judge of the District Court within 1x24 hours. If approval is refused, the blocking must be lifted within 1x24 hours after the refusal.[112]

The emergency seizure mechanism applies to a broader set of circumstances, including difficult geographical conditions, apprehension in flagrante delicto, a concrete risk that evidence will be destroyed or removed, movable or readily transferable Assets, serious threats to national security or human life, and circumstances based on the Investigator’s assessment.[113] The elucidation identifies cryptocurrency, shares, gold or jewelry, securities and funds in bank accounts as examples of Assets that may be rapidly moved or transferred.[114]

The inclusion of an Investigator-assessment ground in both emergency mechanisms gives law-enforcement authorities additional flexibility where a predetermined list of circumstances may not capture the factual urgency of a case. For emergency seizure, the elucidation qualifies this discretion by requiring the factual situation to be assessed professionally, objectively and accountably on the basis of preliminary evidence, available information and field conditions.[115]

However, the emergency seizure provisions contain an internal timing issue that may require clarification. One provision requires post-seizure approval to be requested within a maximum of five working days, while a subsequent provision requires approval within 1x24 hours.[116] The Draft Bill does not expressly explain the relationship between these two periods. Given that the mechanism permits interference with Assets before judicial authorization, clarity regarding the applicable deadline is particularly relevant to the effectiveness of ex post judicial review.

The emergency framework therefore represents a material expansion of Investigator discretion compared with the April Draft Bill. At the same time, it preserves judicial involvement through subsequent approval and requires reversal of the measure where approval is refused.[117] The effectiveness of this safeguard will depend in part on the speed and substantive quality of the court’s review after the coercive measure has already been implemented.

Akbar emphasizes this judicial-control dimension. In his view, coercive Asset-recovery measures, including searches, seizure and blocking, should remain subject to District Court authorization and be implemented consistently with applicable human-rights safeguards.[118] His concern is particularly relevant to emergency measures because the judicial review occurs only after the interference with the Asset has begun.

The emergency mechanism nevertheless addresses a practical problem that is particularly acute for highly liquid or transferable Assets. The ability to move bank funds, securities or crypto-assets rapidly may render prior authorization ineffective where the Asset can disappear before the order is obtained. The July Draft Bill attempts to address that risk by allowing immediate action, while shifting judicial control from an exclusively ex ante model to a combination of immediate enforcement and ex post authorization.

The expansion of immediate enforcement powers also increases the importance of ensuring that value-preservation obligations apply from the moment an Asset is brought under State control, as the effectiveness of Asset recovery depends not only on securing the Asset but also on preserving the value ultimately available for recovery.

 

IV. Evidence and Protection of Rights over Assets

 

A.   Burden and Standard of Proof

Both drafts place the initial burden on the JPN to establish that the Asset sought to be forfeited constitutes a Criminal Asset.[119] Where an objection is raised, the objecting party bears the burden of establishing lawful ownership or demonstrating that the Asset does not constitute a Criminal Asset.[120] The court’s decision correspondingly depends on whether the JPN or the objecting party succeeds in discharging the relevant burden.[121]

The July Draft Bill retains this basic allocation but imposes additional requirements on third parties. Beyond establishing lawful ownership or the absence of a criminal connection, a third party must demonstrate that the Asset was lawfully acquired, that the party did not know and had no reasonable basis to suspect that the Asset was connected with criminal conduct when the transfer occurred, and that appropriate due diligence was conducted before the acquisition.[122] The elucidation describes due diligence as including verification of matters such as land-title status, vehicle documentation and corporate legal status.[123]

The July Draft Bill also develops the evidentiary framework more extensively than the April Draft Bill. The April Draft Bill recognizes letters, Documents, witness testimony, expert testimony and other evidence revealed during the hearing.[124] The July Draft Bill expressly adds physical and electronic evidence, together with any other material capable of being used for evidentiary purposes, provided that it has been lawfully obtained.[125] It further requires evidence to be capable of authentication and authorizes the court to exclude evidence that is unauthenticated and/or unlawfully obtained.[126]

The July Draft Bill also adapts the evidentiary process to intangible Assets. Where the Asset consists of an account or other intangible property, the court may examine a written statement made under oath before an authorized official of the relevant service provider.[127] This is particularly relevant to financial and digital Assets that cannot be physically produced before the court.

Despite this more detailed framework, neither draft expressly determines the degree of persuasion that the JPN must satisfy in proving that an Asset constitutes a Criminal Asset.[128] The Draft Bills establish who bears the evidentiary burden and what forms of evidence may be submitted, but do not expressly adopt a formulation equivalent to a criminal standard of proof or a defined civil standard.

The Academic Paper characterizes NCBF as a civil mechanism operating under a lower evidentiary standard than criminal proceedings, with the State required to establish the connection between the Asset and criminal conduct and the Asset holder subsequently required to demonstrate lawful origin.[129] However, this characterization does not itself determine the evidentiary standard that Indonesian courts would be required to apply under the Draft Bill.

Prof. Hasbullah likewise identifies a clear evidentiary standard as one of the safeguards that should accompany Asset Forfeiture, together with judicial oversight and proportionality.[130] This reinforces the significance of the Draft Bills’ silence on the degree of persuasion required for permanent forfeiture, particularly because the resulting order permanently affects proprietary rights.

The distinction matters because the preliminary thresholds for tracing, blocking and seizure discussed in Section III are not equivalent to the proof ultimately required for permanent forfeiture. The July Draft Bill, for example, permits coercive measures where an Asset is suspected of constituting a Criminal Asset, while final forfeiture requires the JPN to prove that the Asset is in fact a Criminal Asset.[131] A clearer articulation of the applicable final standard could therefore assist courts in determining how strong the connection between the Asset and criminal conduct must be before ownership is permanently transferred to the State.

As discussed in Section I.B, the April Draft Bill’s unexplained-wealth mechanism creates an additional interaction with the burden of proof. Once a sufficiently material discrepancy between an Asset and identifiable lawful income is established, the Asset holder may be required to explain its lawful provenance. This resembles mechanisms already found in Law 31/1999, while still leaving the State with responsibility for establishing the relevant legal basis for forfeiture.[132]

 

B.   Protection of Bona Fide Third Parties

Protection of third-party proprietary rights is already recognized under Law 31/1999. Property belonging to a person other than the defendant may not be forfeited where doing so would prejudice the rights of a bona fide third party, and an affected third party may challenge a forfeiture order before the court.[133] This principle is also reflected in the United Nations Convention against Corruption (“UNCAC”) as ratified through Law No. 7 of 2006 (“Law 7/2006”) which requires confiscation measures and international cooperation for confiscation to preserve the rights of bona fide third parties.[134]

Mangatta similarly emphasizes that Asset recovery should not cause lawful third parties to become additional victims of enforcement measures merely because their property or interests become connected to a criminal proceeding.[135] This concern becomes particularly relevant where Assets have already been transferred, financed or encumbered before forfeiture is sought.

Both drafts provide mechanisms through which a person claiming rights over an Asset may challenge forfeiture. The April Draft Bill requires an objecting party to establish that the blocked or seized Asset lawfully belongs to that party or that the Asset sought to be forfeited is not a Criminal Asset.[136] The July Draft Bill retains that basic test but introduces the more detailed requirements described above concerning lawful acquisition, lack of knowledge or reasonable suspicion and due diligence.[137]

The July formulation consequently places a more substantial evidentiary burden on a third party. Lawful title alone may not be sufficient where the circumstances surrounding the acquisition should reasonably have raised concerns regarding the Asset’s connection with criminal conduct. The due-diligence requirement is particularly relevant to professional parties such as financial institutions, property purchasers and corporations, for whom verification of ownership, encumbrances and counterparties may already form part of ordinary transactional practice.

Akbar considers the protection of good-faith third parties an essential component of the Asset Forfeiture framework. In his view, a person who can demonstrate a lawful transaction, lawful acquisition and good faith should be protected so that legitimate transactions are not adversely affected merely because the Asset later becomes connected with enforcement proceedings.[138]

From a legislative perspective, Bob Hasan, Chair of the Legislation Committee and Member of Commission III of the DPR, similarly frames the protection of bona fide third parties as part of the balance between effective Asset recovery and legal certainty.[139] He specifically links due process and the protection of uninvolved parties with maintaining the national investment climate, reinforcing the importance of ensuring that expanded forfeiture powers do not unsettle legitimate transactions or proprietary interests.

A more difficult issue arises in relation to substitute Assets. Both drafts permit other lawful Assets belonging to an offender to be pursued where the Criminal Asset itself cannot be recovered or is insufficient.[140] Unlike proceeds or instrumentalities of crime, however, a substitute Asset may itself have been lawfully acquired and may already be subject to a mortgage, fiduciary security, hypothec or another proprietary interest held by a third party.

Neither draft expressly establishes the priority between the State’s recovery claim and pre-existing security or proprietary rights over such substitute Assets.[141] The provisions on objections allow third parties to assert that an Asset lawfully belongs to them or is not a Criminal Asset, but do not specifically determine whether a secured creditor retains priority where the offender remains the legal owner of the substitute Asset but a valid security interest has already been created over it.

Indonesian judicial practice provides some guidance on the treatment of such third-party interests. In Decision No. 22/Pdt.Plw/2012/PN.BJ (“Decision 22/2012”), PT Oto Multiartha challenged the forfeiture of a vehicle over which it held a fiduciary security interest. The court upheld the objection and set aside the portion of the criminal judgment ordering the vehicle to be forfeited to the State, recognizing that the third party’s rights arose from a valid financing agreement and duly established fiduciary security.[142] The objecting party also maintained that it neither knew of nor was involved in the criminal offense committed by the debtor.[143]

Decision 22/2012 therefore illustrates that a valid security interest and the absence of knowledge or involvement in the underlying criminal conduct may be relevant in protecting third-party rights. This is particularly relevant to the July Draft Bill, which requires third parties to demonstrate lawful acquisition, absence of knowledge or reasonable grounds to suspect a criminal connection, and appropriate due diligence.[144]

However, uncertainty remains because neither draft expressly determines how such security interests should be prioritized where the State seeks to forfeit a substitute Asset rather than the direct proceeds or instrumentality of a criminal offense.

This distinction is important because ownership and security interests are not necessarily the same. A creditor may not own the Asset and therefore may be unable to establish that the Asset “belongs” to it, while nevertheless holding a legally enforceable proprietary interest over the Asset. Greater clarity on the treatment of such interests would therefore be relevant to determining whether the State may forfeit the entire substitute Asset or only the value remaining after legally protected third-party claims have been satisfied.

Comparative frameworks recognize similar concerns. In the United States, third parties may protect certain pre-existing legal interests or establish bona fide purchaser status in forfeiture proceedings,[145] while the United Kingdom’s Proceeds of Crime Act (“PCA”) requires legitimate third-party interests to be taken into account in determining property available to satisfy confiscation orders.[146]

 

C.   Objections, Compensation and Legal Remedies

The two drafts provide different structures for challenging interference with rights over Assets. Under the April Draft Bill, an affected person may first submit a written objection during the investigation stage against blocking and/or seizure on the basis that the Asset lawfully belongs to that person or is not a Criminal Asset.[147] The objection may include a request for compensation and must be submitted to the direct superior of the Investigator who issued the relevant order within 14 working days.[148]

The April Draft Bill separately permits objections or opposition during the court proceeding, and the objecting party must prove lawful ownership or the absence of a criminal connection.[149] Where that burden is satisfied, the court must reject the forfeiture application in relation to the relevant Asset and order its return to the entitled party.[150]

The July Draft Bill places the principal objection mechanism at the court stage. Following public announcement of the Asset Forfeiture application, any person whose rights may be affected may submit a written objection to the Chief Judge of the District Court and may accompany that objection with a compensation claim.[151] The Draft Bill excludes certain persons from using this mechanism, including absconding suspects or defendants, persons designated as wanted, defendants tried in absentia and their advocates.[152]

Compensation is also regulated differently. Under the April Draft Bill, compensation attached to an investigation-stage objection may not exceed the appraised value of the blocked or seized Asset.[153] Separately, the eventual court judgment must address compensation where it has been requested by an objecting or opposing party.[154] The Draft Bill does not expressly establish an equivalent separate cap for that court-stage award.

The July Draft Bill more expressly integrates compensation into the court objection mechanism. Compensation may not exceed the value of the relevant Asset as determined through Asset valuation, and payment is sourced from the perpetual fund established for damages, rehabilitation, restitution and compensation.[155] The judgment must also determine the compensation request where one has been submitted.[156]

This provides greater certainty regarding the source of payment, although the July Draft Bill does not elaborate in detail on the types of loss that may be compensated. In particular, the text does not expressly clarify whether compensation is confined to the value of the Asset or may also address consequential losses arising because the Asset could not be used during blocking, seizure or forfeiture proceedings.

Akbar emphasizes that the procedural route for challenging coercive measures and obtaining the return of an Asset should be clearly defined. In his view, such protection could operate through an existing judicial-review mechanism or through a specific mechanism under the Asset Forfeiture framework, provided that the procedure clearly determines who is entitled to the Asset and how it is to be returned.[157]

While the July Draft Bill provides greater detail for certain forms of return and execution, the Draft Bills do not establish an equally comprehensive end-to-end procedure governing the timing and manner of return across all circumstances in which an Asset must be released or restored to an entitled party.

With respect to legal remedies against the forfeiture judgment itself, both drafts provide cassation as the sole available remedy and treat the cassation judgment as final and binding.[158] The July Draft Bill, however, provides more detailed deadlines by requiring a cassation application to be filed within 14 days and the cassation examination to be completed within 30 working days.[159] Where the Asset owner is unknown or cannot be located, the District Court judgment becomes final and binding without awaiting such review.[160]

The July Draft Bill therefore consolidates objections more clearly within the judicial stage and provides greater procedural detail concerning compensation and cassation. At the same time, questions concerning the scope of recoverable losses and the treatment of proprietary interests that fall short of ownership, particularly security rights over substitute Assets, remain relevant to the effectiveness of these safeguards.

 

V.   Governance of Seized and Forfeited Assets

 

A.   Asset Management Before and After Court Judgment

The April and July Draft Bills adopt materially different institutional models for the management of seized Assets. Under the April Draft Bill, Asset management is comparatively centralized. Following seizure, Criminal Assets are transferred to the Attorney General, who is responsible for their storage, security and maintenance, while the broader Asset-management framework also assigns the Attorney General responsibility for valuation, transfer, use, utilization and return of Criminal Assets.[161]

The July Draft Bill instead adopts a stage-based management model. Seized Criminal Assets are controlled and managed by the Investigator, prosecutor or judge according to the stage of the proceeding.[162] Management must be effective, efficient, transparent and accountable, and is directed toward supporting the proceeding, securing the Asset, preserving its economic value and facilitating Asset recovery.[163]

This allocation means that responsibility for the same Asset may shift as the case progresses from investigation to prosecution and judicial examination. The July Draft Bill therefore places management responsibility closer to the institution exercising control over the Asset at each procedural stage, rather than centralizing pre-judgment management within a single institution.

Prof. Asep emphasizes that Asset recovery should be treated as an integrated process beginning at the earliest stage of case handling, rather than as a function that starts only after judgment.[164] This perspective places tracing, identification, preservation, adjudication and eventual return within a continuous recovery process, making continuity between institutions particularly important under the July Draft Bill’s stage-based management model.

The architecture changes again after a final and binding judgment. Under the April Draft Bill, execution is carried out by the JPN and an Asset forfeited to the State is subsequently transferred to the institution authorized to manage Criminal Assets.[165] The Attorney General remains assigned broad Asset-management duties under the dedicated management provisions.[166]

The July Draft Bill provides a more specific distinction according to the form of the forfeited Asset. Cash must be deposited by the prosecutor into the State Treasury account within one working day after the judgment becomes final and binding, while non-cash Assets must be transferred for management to an echelon-I-level unit responsible for State Asset management within the ministry responsible for State finance.[167] Separately, execution of a judgment forfeiting an Asset to the State is carried out by the JPN with assistance from an Asset Management Institution.[168]

The July Draft Bill therefore separates management before judgment, execution of the forfeiture judgment and post-judgment administration of the Asset among different actors. This differs from the stronger concentration of management functions around the Attorney General under the April Draft Bill.[169]

 

B.   Institutions and Powers of Asset Managers

The institutional difference between the drafts is also reflected in the scope of management powers. Under the April Draft Bill, the Attorney General is assigned a broad range of functions covering storage, security, maintenance, valuation, transfer, use, utilization and return of Criminal Assets.[170] For storage, security and maintenance, the Attorney General may appoint the State Confiscated Objects Storage House (Rumah Penyimpanan Benda Sitaan Negara - “RUPBASAN”) or another party to provide assistance.[171] Valuation may also be conducted in cooperation with the ministry responsible for State finance.[172]

The July Draft Bill distributes pre-judgment functions among the Investigator, prosecutor and judge. Their expressly stated powers include storage, security, maintenance and valuation, with each function directed toward preserving the Asset during the enforcement process.[173] After the judgment becomes final, responsibility then shifts toward the prosecutor, the relevant State Asset-management unit within the finance ministry and, for execution of Assets forfeited to the State, the Asset Management Institution.[174]

However, the July Draft Bill does not further identify or define the Asset Management Institution that is to assist the JPN in executing a forfeiture judgment.[175] Nor does the operative framework expressly clarify whether that institution is the same entity as the finance-ministry unit responsible for managing non-cash forfeited Assets. Further specification of the institutional relationship may therefore be necessary to determine responsibility for custody, valuation, disposal and eventual administration of forfeited Assets.

This issue is particularly relevant given the broader objective of integrated Asset recovery. Patris describes the Asset Recovery Agency’s approach as a “Single Gate System” integrating financial tracing, legal safeguarding and maintenance, valuation and final Asset resolution.[176] He also identifies a strengthened single-gate approach through the role of the Asset Recovery Prosecutor as important to the future Asset Forfeiture framework.[177]

Against that operational model, the July Draft Bill’s stage-based structure may require clear protocols for institutional transfer and continuity of Asset records as responsibility shifts between the Investigator, prosecutor, court and post-judgment Asset manager.

 

C.   Preservation of Value, Disposal and Management of Special Assets

Both drafts recognize that Asset management involves more than physical custody and must address the risk that seized Assets may lose economic value before a final judgment. The April Draft Bill expressly requires storage, maintenance and security to be directed toward maintaining or preserving the value of Criminal Assets.[178]

The April Draft Bill also permits Criminal Assets to be transferred through sale both before and after a final and binding judgment. A pre-judgment sale may be undertaken at the request of the Investigator or JPN, while the sale itself is conducted through the State auction office.[179] Assets that remain unsold following auction are subsequently managed under the framework governing State Property.[180]

The April Draft Bill further allows temporary continued use or utilization of a seized Asset by a third party before final judgment, subject to conditions intended to prevent physical alteration, transfer of use and unlawful use, while requiring the third party to bear maintenance and other associated costs.[181] This provides one route for avoiding purely static custody of Assets that may continue to have productive or operational value.

The July Draft Bill regulates particular categories of vulnerable Assets more expressly. Perishable or dangerous Assets that cannot reasonably be stored until final judgment may be secured, destroyed or auctioned in accordance with applicable law.[182] Dangerous or prohibited goods may also be forfeited for State purposes or destroyed with permission from the Chief Judge of the District Court.[183]

A specific mechanism is also introduced for intangible Assets that may decline in value, lose utility, expire, experience significant price fluctuations or otherwise face risks of value deterioration. Such Assets may be sold immediately upon application by the Investigator, prosecutor or judge and with authorization from the Chief Judge of the District Court.[184] The elucidation identifies nominee accounts, shares, crypto-assets, stablecoins, non-fungible tokens (“NFT”) and digital Assets held through marketplaces or payment gateways as examples of intangible Assets covered by this mechanism.[185]

This more specific treatment is significant because preservation strategies cannot be uniform across physical property, operating businesses and highly volatile digital Assets. Patris similarly emphasizes pre-seizure planning that assesses maintenance costs against economic value, as well as active-management arrangements for operating businesses. These may include entrusting management to credible third parties so that business operations and employment continue, with operational proceeds maintained through a dedicated escrow arrangement.[186]

Prof. Hasbullah similarly argues that Asset management should be designed to preserve economic value from the preservation stage rather than beginning only after judgment, and identifies specialized Asset management as part of an effective recovery framework.[187] This reinforces the need for management strategies that reflect the characteristics, volatility and maintenance requirements of the Asset concerned.

The same approach reflects a broader concern that static seizure may itself destroy the value ultimately available for recovery. Management decisions therefore need to account not only for legal custody but also for liquidity, volatility, maintenance costs and whether the Asset constitutes an operating business or other going concern.

 

D.   Transparency, Supervision and Accountability

The April Draft Bill establishes a relatively centralized transparency mechanism alongside the Attorney General’s management responsibilities. The Attorney General is required to establish an integrated electronic Criminal Asset information system designed to support accountability and transparency in Asset management.[188] The system must contain information covering, among other matters, the type, value and status of the Asset, its physical storage location, income and expenditure associated with its maintenance, auction information and the final court judgment relating to the Asset.[189]

The Attorney General must also report on Asset management to the President every six months. Accountability includes performance and financial reports, an annual Asset-management report and public access to information concerning Asset management.[190]

The July Draft Bill adopts a different accountability structure corresponding to its distributed management model. Asset management must be reported every six months by the Chief of the Indonesian National Police, Attorney General, Chief Justice of the Supreme Court and Minister of Finance to the President and DPR.[191] The reports cover performance and financial accountability as well as Asset-management achievements, while each of the relevant institutions must also provide public access to Asset-management information through electronic media.[192]

Beyond reporting management activities, Hasbullah proposes the Asset Recovery Rate as an outcome-based measure of the value actually recovered relative to the value capable of recovery. He considers this measure capable of operating as a cross-institutional performance indicator for law-enforcement and Asset-management institutions.[193] Such an indicator could complement the performance and financial reporting contemplated under the July Draft Bill by measuring the substantive recovery achieved through the Asset Forfeiture framework.

Unlike the April Draft Bill, the July Draft Bill does not expressly require the establishment of a single integrated electronic information system with a specified minimum dataset. Its transparency mechanism instead relies on periodic reporting and public electronic disclosure by each institution involved in Asset management.

This distinction reflects the broader institutional architecture of the two drafts. The April model combines centralized management with a centralized information system, whereas the July model distributes both management and reporting responsibilities across several institutions. The latter may increase institutional accountability at each procedural stage, but also makes interoperability and consistent Asset records more important as an Asset moves between institutions.

Neither draft expressly establishes a separate independent supervisory body dedicated specifically to Asset management. Oversight is instead built through institutional responsibility, periodic reporting, public access to information and, under the July Draft Bill, reporting to both the executive and the DPR.

 

Conclusion

The July Draft Bill represents a substantial restructuring of the Asset Forfeiture framework contemplated under the April Draft Bill. While the April Draft Bill is principally built around an NCBF model, the July Draft Bill adopts a hybrid structure combining CBF and NCBF, narrows the scope of applicable offenses through the concept of Economic-Motive Crime, raises the minimum Asset-value threshold for NCBF and no longer separately regulates unexplained wealth. At the same time, it introduces more detailed rules on Asset tracing, blocking and seizure, emergency measures, evidentiary requirements, third-party protection and the management of Assets throughout the enforcement process.

However, several issues remain relevant to the effectiveness and legal certainty of the proposed framework. These include the parameters for determining an Economic-Motive Crime, the evidentiary standard applicable to NCBF, the relationship between NCBF and criminal proceedings, safeguards surrounding emergency blocking and seizure, the treatment of bona fide third-party and secured-creditor interests, and the allocation of responsibilities among the institutions involved in managing seized and forfeited Assets. The removal of unexplained wealth as a standalone basis for Asset Forfeiture also warrants further consideration in light of its potential role in addressing Assets whose lawful provenance cannot adequately be explained.

Going forward, it is hoped that further deliberation of the Draft Bill could provide clearer substantive and procedural parameters while maintaining an effective balance between Asset recovery and the protection of legitimate property rights. Greater clarity on institutional coordination, judicial oversight, evidentiary standards, third-party remedies and the preservation of Asset value would also be important to ensure that the eventual framework is not only capable of recovering Criminal Assets effectively, but is also predictable, accountable and capable of being implemented consistently across different enforcement institutions. _(RL)

For ease of reference, a comprehensive comparison matrix setting out the key differences between the April Draft Bill and the July Draft Bill is provided below: