November 8, 2024 10:02 pm

OIKN Guarantees 80-Year Building Rights in Nusantara Capital, Here’s the Full Explanation

JAKARTA – Basuki Hadimuljono, the Acting Head of the Nusantara Capital Authority (OIKN), has confirmed that investors in the Nusantara Capital City (IKN) will receive a range of exclusive benefits, including direct access to long-term land rights. Among the key incentives, investors will be granted Building Rights (HGB) and Cultivation Rights (HGU) without the traditional phased approvals, making the investment process significantly more streamlined and attractive.

This initiative is part of the provisions outlined in Presidential Regulation (PP) No. 29 of 2024, which governs Business Licensing, Ease of Doing Business, and Investment Facilities for Business Players in the Nusantara Capital. Under this new regulation, Article 18 has been revised, specifically altering the rules surrounding land rights (HAT). Investors in IKN can now directly obtain HGB for up to 80 years and HGU for up to 95 years, along with usage rights for up to 80 years, without the need for a step-by-step approval process.

“This regulation is tailored to IKN, making it a special case to attract investment. Under the previous land tenure system, the process was much slower, but with this new presidential regulation, it has become much faster,” Basuki explained during a discussion at the Ministry of Public Works and Public Housing (PUPR) on Tuesday, June 20, 2024.

Basuki further elaborated that HGU, HGB, and Usage Rights can be issued in two cycles, allowing for a maximum ownership period of up to 190 years for HGU, 160 years for HGB, and 160 years for Usage Rights. He emphasized that these extended rights are unique to the IKN area, distinguishing it from other regions in Indonesia.

“In the past, HGB was granted incrementally—first for 20 years, then extended by 30 years, and then another 30 years. Now, we simplify this by offering 80 years right from the start,” he stated.

This streamlined approach to granting land rights is further supported by Presidential Regulation (Perpres) No. 75 of 2024 on the Acceleration of the Development of the Nusantara Capital. Article 9 of this regulation details that HGU can be granted for up to 95 years in the first cycle and extended for another 95 years in the second cycle, as long as the criteria and evaluation stages are met.

Similarly, the regulation allows for HGB to be granted for 80 years in the first cycle and renewed for another 80 years in the second cycle, totaling 160 years. Usage rights follow the same pattern, with a maximum of 80 years per cycle.

“The first cycle of land rights, as mentioned in paragraph 2, will be granted by the Ministry responsible for agrarian and land affairs, based on a request from the Nusantara Capital Authority,” as stated in Article 9, paragraph 3. These provisions demonstrate the government’s determination to make IKN an attractive destination for investors, offering unprecedented long-term security for land ownership. The simplification and extension of land rights are expected to play a crucial role in drawing both local and international investors, fostering the rapid development of Nusantara as Indonesia’s new capital.