ABOUT RIGHT TO BUILD (HGB)

Hak Guna Bangunan (HGB) is right to establish and has a building on land not his own within a certain period (article 35 paragraph 1 BAL).

Not his own sense, means the HGB can be issued from:

+ Granting/Submitting rights (HGB- as PRIMARY RIGHT)

+ Agreement on the ground loading HGB Property belonging to

another person (HGB-as SECONDARY RIGHT)

HGB Land Size’s Restriction:

There are no restrictions, but tailored to the needs of only a provision that if a family has to have 5 (five) then the title deed for each amendment must obtain permission from the BPN

HGB RULES AND REGULATION

BAL:

Article 35 to 40, article 50 jo. 52, article 55;

Conversion provisions of Article I (3) and (4), Article II, V and Article VIII (1).

Implementing Regulations:

Government Regulation No. 24 of 1997 on Land Registration;

Law No. 1 of 1967 on Foreign Investment;

Regulation of the Minister of State for Agrarian Affairs/Chairman of Land Agency No. 9 of 1999 on Procedures for Granting and Revocation Rights and Rights of State Land Management which replaces the Domestic No. 5 of 1973 on the Provisions on Procedures for Granting the Right to Land title;

PMNA/Ka. National Land Agencies No. 2 of 1999, on location license that replaces PMNA/Chairman of National Land Agencies No. 2 of 1993, concerning Procedures for Obtaining Permit Location and Land Rights For companies in the Framework of Investment;

Government Regulation No. 40 of 1996 on the Right of Cultivation, Land Right and Right to Use State Land.

Law No. 4 of 1996 on Hak Tanggungan upon Land of Object matters related to Land.

THE NATURE AND CHARACTERISTICS-HGB

Classified as right that must be registered by Government Regulation No. 24 of 1997;

May be transfered;

Occur because of legal events, such as inheritance without a will or a mixture of property through intermarriage.

Transferable:

Occurred because of legal subjects perform a legal act, such as conduct sale and purchase agreement, grant, exchange, gift with wills and other deeds which intend to move over land tenure.

Duration time is limited;

Can be released by the right holder and becomes State land;

Can be used as collateral for loan with Hak Tanggungan.

TIME PERIOD-HGB (1)

To HGB on State land or land management rights (HPL), a maximum of 30 years and can be extended another 20 years (Article 35 Paragraph 1 BAL jo. Article 25 of Government Regulation No. 40 of 1996;

As for the HGB on HM: at least 30 years old (article 29 Paragraph 1 Government Regulation No. 40 of 1996).

Under the agreement between the holder of Right of Ownership and Building Right on Land, the HGB on HM-land can be re-new by PPAT deed and must be registered at the Land Office.

TIME PERIOD-HGB (2) After a period of time and the extension expires, the holder of HGB in the ground state can apply for renewal rights.

The requirement of the request for extension and renewal of HGB:

1. The land is still cultivated properly in accordance with the circumstances, the nature and purpose of granting such rights;

2. The terms of such entitlements are met well by the right holder;

3. Holder of right is still qualified as a holder of HGB;

4. The land is still in accordance with the existing Spatial Planning concerned;

5. The application is filed not later than two years before the time expire of the HGB.

For an extension or renewal of land HGB on HPL-Land in addition to the above conditions, must be with the consent of the holders of Right of Management.

ENTITLED SUBJECTS-HGB

Indonesian citizen;

Indonesian Legal Entities;

Joint Ventures Company (under the Regulation of Minister of Agrarian Affairs), if needed land for the purposes of emplacement, factory buildings, etc. (Presidential Decree No. 34 of 1992).

RIGHTS AND OBLIGATIONS – HGB HOLDERS (2)

RIGHTS/DUTIES:

Occupy and use the land for a certain time to construct and own the building for personal or business purposes, as well as

Transfer of such rights to other parties and burden

RIGHTS AND OBLIGATIONS – HGB HOLDERS (2)

OBLIGATIONS:

1. Paying money to the State revenue;

2. Use in accordance with the designated land;

3. Maintain good land and existing buildings on it and preserving life;

4. Provide a way out or the way of water or other conveniences for the yard or parcels of land locked up because of geographical or other reasons;

5. Submit the return of land granted to the HGB to the State, the holder or holders of the Management Rights Property Rights after the HGB is clear;

6. Submit a certificate that has been deleted HGB to the Head of the Land Office.

LAND SIZE AND ISSUANCE-HGB

Land Size- Restriction:

There are no restrictions, but tailored to the needs of only a provision that if a family already have 5 (five) certificates of land, then for each amendment must obtain permission from the National Land Agencies.

Issuances:

If the origin of land is State land, then the occurrence is through a right application;

If coming from land that has been taken with certain rights (HM and HPL) it is through by agreement between the landowner and the party who will obtain the rights.

TRANSFER AND EXPIRATION- HGB

Transfer Methods : Sale and purchase;

Exchange trade;

Investment in capital;

Grant

Inheritance.

The Expirations: Term time ends;

Cancelled because the terms are not met by the holder;

Relinquished on a voluntary basis by the holders of the rights before the period ends;

Expropriated for the public interest (Law No. 20 of 1961);

The land is left idle;

The land is destroyed;

ABOUT HP

HP (article 41 BAL) is the right to use and / or take the products of land which is directly controlled by State or other landowner, a member of the authority and duties specified in the decree granting rights (state land) or in agreement with the landowner which is not a lease agreement or treaty land preparation (land owned by someone else).

From the formula above, it can be concluded that the Right to Use is the right on land agricultural and agricultural land.

The word "use", indicating that the land can be used for buildings (as space);

The word "harvest" indicates that the land can be used for agriculture (as factors of production).

RULES AND REGULATIONS-HP

(1) BAL:

Article 41 to 43, section 49 paragraph 1, article 50 paragraph 2 jo. Article 52;

(2) Implementing Regulations:

Law No. 25 of 2007 on Foreign Investment;

Law No. 4 of 1996 on Hak Tanggungan upon Land of Object matters related to Land.

Government Regulation No. 40 of 1996 on Right of Cultivation, Land Right and Right to Use State Land;

Government Regulation No. 41 of 1996 on on Ownership of Dwelling House or Shelter Residence by Foreigners Domiciled in Indonesia

Article 1 Regulation of Minister of Agrarian Affairs No. 9 of 1965 on the Implementation of the Conversion Rights to Land and the provisions of the next policy;

Article 1 Regulation of Minister of Agrarian Affairs of 1966 on Registration of Right of Use and Rights Management;

Regulation of the Minister of State for Agrarian Affairs/Chairman of Land Agency No. 9 of 1999 on Procedures for Granting and Revocation of State Land Right and Right Management.

The nature and characteristic - HP

Classified as right that must be registered;

Can be transferred;

According to Article 43 of the BAL, Right of Use can be transferred to other parties with the permission of the competent authority. Right to Use Land Property Rights can only be transferred to another party if there is a possibilty in the agreement concerned.

After the enactment of Regulation of Minister of Agrarian Affairs No. 9 of 1965 jo. Regulation of Minister of Agrarian Affairs No. 1 of 1966 which stipulates that the State Land Use Rights is included as the rights required to be registered, then the Right of Use may be transferred to another party;

Can be supplied with Free of Charge, with payment or any form of service provision (article 41 Paragraph 2 of the BAL)

Can be removed;

Can be used as collateral for loans with HT.

TIME PERIODS-HP

1. For general purposes:

State land : 25 years old, can be extended 20 years and renewable

HM- land : 25 years old and cannot be extended.

Can be renewed by ‘PPAT deed’ and must be registered at the Land Office.

2. For Specific purposes:

HP also can be granted during needed for specific purposes, namely the interests of government agencies, religious, social as well as representatives of foreign countries and international agencies.

ENTITLED SUBJECTS-HP

Indonesian citizen;

Indonesian Legal Entities (Corporation)

Ministry, Non-Ministry Government Institutions, and Local Government;

Religious bodies and social;

Foreign citizen who is domiciled in Indonesia;

Foreign legal entities that have a representative in Indonesia;

Representatives of foreign countries and representatives of international agencies.

Rights and Obligations of the Subjects- HP

Rights:

1. Occupy and use the land for a certain time to establish and have the building for personal or business purposes, as well as

2. Transfer the right to another party and encumber.

RIGHTS AND OBLIGATIONS OF THE SUBJECTS- HP

Rights to:

1. Occupy and use the land for a certain time to establish and have the building for personal or business purposes, as well as

2. Transfer the right to another party and to encumber for loan security (HT).

RIGHTS AND OBLIGATIONS OF THE SUBJECTS- HP

Obligations/duties:

Pay money to the State revenue;

Use the land in accordance with the designated and requirements;

Maintain good land and existing buildings on it and preserving life;

Provide a way out or the way of water or other conveniences for the yard or parcels of land locked up because of geographical or other reasons;

Submit the return of land granted to the Right of Use to the State, the holder or holders of the Management Rights Property Rights after the Right to Use the delete;

Submit a certificate of Right to Use that have been removed to the head office of the Land.

ISSUANCE AND EXPIRATION- HP

ISSUANCE (Article 41 paragraph 1) :

If the origin of land is State land, then the occurrence is through a rights application with the Decree Granting Rights (SKPH);

If it comes from land that has been taken with certain rights (Property Rights and Rights Management) so incurred through an agreement between the landowner and the entity will acquire Right of Use;

Derived from the conversion of old rights on September 24, 1960

EXPIRATION:

Term time ends;

Cancelled because the terms are not met by the holder;

Relinquished on a voluntary basis by the holders of the rights before

the period ends;

Expropriated for the public interest (Law No. 20 of 1961);

The land is left idle;

The land is destroyed;

Holders of rights do not qualify as a holder of HP.

ABOUT HPL- (ARTICLES 3 PMDN* NO. 5 OF 1974) )

HPL are the rights to the land which authorizes the holder to:

Designated to plan and use of land;

Using the land for its own purposes;

Surrender part of his land to a third party according to predetermined requirements for holders of such rights, including designated terms, terms of use, in terms of duration and in terms of finances.

*PMDN : The Regulation of Ministry of Home Affairs

ABOUT HPL

After a period of time the land rights granted to third parties was over the land back into full mastery of HPL holder in a state free of the rights of the burden.

HPL is always derived from the so-called "Hak Beheer (Dutch)", namely the State ownership after BAL through the Regulation of the Minister of Agrarian Affairs No. 9 of 1965 converted to the land right under stipulations of The National Land Law :

If the Hak Beheer, land used by government agencies for its own purposes, then converted to a Right to Use (HP), but

If the land in addition to be used alone, there are parts of other land will be handed over to third parties, including designated terms, usage and length of time and finances, then the Hak Beheer converted into HPL.

The nature and characteristic - HPL

Belong to the right that must be registered according to the Regulation of the Minister of Agrarian Affairs No. 1 of 1966;

Non-transferable;

May not be used as collateral for loans;

It has the aspects of civil and public aspects.

ENTITLED SUBJECTS AND ISSUANCE-HPL

Subject s:

Legal entities established under Indonesian law and domiciled in Indonesia which are wholly owned by Government and/or local government engaged in similar business activities with industry and ports;

Institutions and government agencies.

Issuance:

By the government decree and for relevance land used.

SIZE RESTRICTION AND EXPIRATION-HPL

Size Restriction:

It is not limited and according to the needs.

Expirations by:

Released by the right holder;

Relinquish for public purposes;

It is left become idle-land;

Land destroyed.