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Priority Rights in Land Law in Indonesia

By June 23, 2021 No Comments

If one looks at the provisions of land law in Indonesia, there is a provision on the right to get the first priority or take precedence/recedence based on the order of the recipient of the land rights. That right is referred to as a priority right.

Provisions on Priority Rights can be found in some regulations and jurisprudences. One of them can be seen in Article 37 Paragraph (4) of Government Regulation No. 18 of 2021 On Right of Management, Land Right, Condominium Unit and Land Registration (“GR No. 18/2021“). The article basically stipulates that former right holders can be given priority over land directly controlled by the state if the following requirements are fulfilled:

  1. the land is still being cultivated and utilized properly according to the circumstances, nature, and purpose of its right granting;
  2. the conditions of right granting are properly met by the rights holder;
  3. the right holder still qualifies as a right holder;
  4. the land is still in accordance with the spatial plan;
  5. not used and/or planned for the public benefit;
  6. natural resources and the environment; and
  7. the state of the land and the surrounding community.

Before the enactment of GR No. 18 of 2021, the regulation on Priority Rights can be seen in Article 9 Paragraph (2) of Government Regulation No. 40 of 1996 on Right to Cultivate, and Right to Build and Right of Use (“GR No. 40/1996“). One provision stipulates that the right to build, as well as right to cultivate and right of use can be renewed at the request of the rights holder if:

  1. the land is still well cultivated according to the circumstances, nature, and purpose of its right granting;
  2. the conditions of right granting are properly fulfilled by the rights holder; and
  3. right holder is still eligible as rights holder.

Furthermore, provisions on Priority Rights can also be found in jurisprudence. As in Supreme Court Decision No.: 2557 K/Pdt/2016 which is essentially the Panel of Judges considers that in order for a former rights holder to have priority rights, the former rights holder must apply for an extension of the right within a period of 2 (two) years before the expiration of such land right.

Then, in the Supreme Court’s Decision No.: 603/K/Pdt/2013, the Panel of Judges considers that the party who obtains the priority scale is that who factually occupies the land. This is in line with the Consideration of the Panel of Judges on the Supreme Court Decision No.: 475 K/Pdt/2010 which is basically as a party that controls and strives for land continuously for a long time (in casu 30 years) without any objections from other parties, then the plaintiff is said to be a good-faith tenant. Thus, he should be entitled to get the first opportunity to apply for property rights on his land.

Based on the jurisprudence outlined above, it can be seen that in order for a priority right to take effect, the former rights holder must fulfill two elements, namely: (i) continuous control and cultivation of land; and (ii) apply for extension or renewal of land right. Nowadays, as per the GR No. 18/2021, there are seven conditions to be fulfilled to have the priority rights.

Thus, it can be concluded that the former rights holder can have priority rights if he or she has fulfilled the requirements and elements that have been stipulated in the regulations and jurisprudence.

Alya Batrisiya