Buying & Leasing Land in Indonesia
Updated: Nov 10, 2021
All Indonesian property ownership and construction law falls under the scope and jurisdiction of ‘Indonesian Agrarian Law’. Indonesian Agrarian Law, Law No. 5 of 1960, governs the property ownership in Indonesia in regards to lands but has been provisioned and amended multiple times throughout the years to further promote and accommodate foreign investment. The Meraki Concept has invested significant time and resources in establishing the appropriate legal structures to ensure full compliance with Indonesian foreign ownership laws in accordance with the countries legislation and regulations.
There are three basic options available for foreigners who wish to acquire land, develop property or simply purchase/lease an existing infrastructure. Below we will summarize in more depths the pros and cons of all three and provide a complete breakdown and description of the relevant processes and requirements. Establishing your own PT PMA Ownership through an existing PT PMA Ownership via an Indonesian Nominee Since only Indonesian nationals have the ability to legally own land under the title ‘Hak Milik’ which is the freehold land ownership title, it is true that as a foreigner, you can never truly own any land in Indonesia. In the case of foreigners with invested interest in development or property ownership in Indonesia there are however alternative legal avenues available to them, namely, the PT PMA ‘Perseroan Terbatas Penanaman Modal Asing’ otherwise known as ‘Limited Liability Foreign Investment Company’ through which foreign nationals may acquire entitlement over land in the form of ‘Hak Sewa’, ‘Hak Pakai’ or ‘Hak Guna Bangunan’. Our team of constructions, legal, realtor and design professionals are here to guide you through the turmoil of foreign ownership laws and regulations, thus allowing you to make an informed decision on your acquisition before putting pen to paper. Our highly skilled consultants will tailor a package to your exacting requirements, minimizing your risk, saving you time and money and giving you peace of mind.