Indonesia Real Estate Law – Exemption of License to Use and Develop Land in DKI Jakarta

use land in jakarta

Background

Governor of Jakarta on 24 August 2016 issued a regulation on the exemption of license to use and develop land  (“Pergub No. 166/1016”). The regulation will become effective as of 29 August 2016.

Pergub No. 1

66/2016 replaces the old regulation No. 76 of 2008 (“Pergub No. 76/2008”), and is formulated to provide a legal certainty in exemption of license letter to use and develop land (“SIPPT”) and/or license to use and develop land (“IPPT”)  and/or IPPT.

Prior to this regulation, Pergub No. 76/2008 was yet to cover the examption of SIPPT towards industrial company located in the industrial area and/or particular area, whereas it is vital in providing the comfort and attraction in investment especially for private companies located in industrial area and/or particular area. It is one of the considerations in issuing the Pergub No. 166/2016.

Objects of Exemption of SIPPT and/or IPPT

Pergub No. 166/2016 widens the type of objects included in the list of SIPPT and/or IPPT exemption, namely Special Economic Zones (“KEK”) Marunda and Jakarta Industrial Estate Pulogadung (“JIEP”) and other industrial zone owned by Central Government, Regional Government, Regional Government-owned Entreprise (“BUMD”) and State-owned Enterprise (“BUMN”) that have obtained the location permit of industrial area in accordance with the prevailing regulations.

Any other lands to be exempted are (a) land owned by Provincial Government of Special Capital City Region of Jakarta that is managed by Regional Apparatur Works Unit (SKPD/UKPD) from Special Capital City Region of Jakarta, and (b) land with status of BUMD’s asset and not in cooperation with any private party.

Requirements for Exemption of SIPPT and/or IPPT

Despite obtaining the exemption, the execution of construction still requires the building construction permit (“IMB”), certificate of feasible function and other regional licensing set out under the law. In submitting the application of licensing, each industrial company is required to obtain the recommendation letter from industrial area company.

Besides fulfilling the license, for the land area condemned with the public infrastructure, facility, and utility then it has to be realized. In additions, this realization is a prerequisite of IMB.

For the issued SIPPT and/or IPPT of industrial area before this Governor Regulation takes place shall proceed with their licensing process. On the other hand, the issued SIPPT and/or IPPT that does not oblige to fulfill any obligation, but already completed the licensing process, will be revoked.


Author : Afaf Dini Hamid 

 

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Indonesia Real Estate Law – Exemption of License to Use and Develop Land in DKI Jakarta
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