Buy property in Indonesia mixed couple

[KaBIm]

mmmm, so does a 'prenup' have to be done before the nuptials, or can be done after...if you know what i mean :roll:

Legally speaking both the stipulations of the Marriage Law and the Indonesian Civil code are clear... Article 147 of the Indonesian Civil Code, for example, stipulates that "The prenuptial agreement shall be invalid if it is not drawn up by notarial deed, prior to concluding the marriage."
Note that a prenup should be registered by the local court and the catatan sipil to be valid in an Indonesian court in case of a legal problem arise. IMHO a "prenup" which woud have been "arranged" by a notaris after a marriage would not resist any verification. Therefore, better to give a miss to this kind of solution that won't solve problems but ad some more. They are just a way to waste and loose money.

 

[KaBIm]

My wife owned property before we were married, we have no prenup, but dont have a problem with anyone because she does own property. She uses her maiden name in indo, so what is stopping her buying more property, in her name????

Inheritance (or leg) of assets and acquisition of assets through a buying/selling agreement are treated differently under Indonesian Law. The former aren't included in the joint property of the couple, while the latter are, even if they are acquired prior to the wedding. Hence the importance of the prenup here again.

 

[goldminer]

Thanks KaBIm, another example of your value to us all. If i may ask another question. My daughter holds dual passports, oz and indo... what rights does she have as far as owning property?

 

[mimpimanis]

And another question from me, slightly along the same lines....

I understand that should Made die before me I have one year to sell our property or it goes to the state. However as we have a son doesn't he inherit it or could I sell to him for a nominal fee? He is Indonesian so I would imagine that ownership wouldnt be an issue.

 

[vandor]

If the States finds out of such situation, legally speaking, the SHM could be nullified and the land could fall to the State with no compensation (article 21, section 3 and article 26, section 2 of the Basic Agrarian Law 5/1960).

Not really, 21/3 says that you have one year to sort out the land ownership.

Basically it means that the right of ownership of an Indonesian woman, married to a foreigner is precluded. Since anything own by a couple is joint property, even a land title under the name of the indonesian spouse would be, by half, the property of the foreigner.

However, to date, I haven't find in the jurisprudence of the dozens of decision of justice that I have consulted on the land matter while researching land law, any decision where a mixed couple with no prenup and a SHM established under the indonesian spouse's name was depossessed of their land.

I still have the impression that this kind of combination of the two laws is just a speculation of some notaries or lawyers, who want to make things look more complicated than they are in fact (in order to charge extra money for prenups etc.).
Other than that, whether you make it or not, I have never seen either the famous "prenup" or the "joint ownership" being shown on the land ownership certificates.

...both the Notaris and BPN may raise an eyebrow and discover that a SHM has been established with no legal basis.

The legal basis to establish the ownership is the sale and purchase agreement and not the prenup agreement.

 

[KaBIm]

If the States finds out of such situation, legally speaking, the SHM could be nullified and the land could fall to the State with no compensation (article 21, section 3 and article 26, section 2 of the Basic Agrarian Law 5/1960).

Not really, 21/3 says that you have one year to sort out the land ownership.

Article 21 section 3 reads:
(3) Orang asing yang sesudah berlakunya Undang-undang ini memperoleh hak milik karena pewarisan tanpa wasiat atau percampuran harta karena perkawinan, demikian pula warga-negara Indonesia yang mempunyai hak milik dan setelah berlakunya Undang-undang ini
kehilangan kewarga-negaraannya wajib melepaskan hak itu didalam jangka waktu satu tahun sejak diperolehnya hak tersebut atau hilangnya kewarga-negaraan itu. Jika sesudah jangka waktu tersebut lampau hak milik itu dilepaskan, maka hak tersebut hapus karena
hukum dan tanahnya jatuh pada Negara, dengan ketentuan bahwa hak-hak pihak lain yang membebaninya tetap berlangsung
Tranlation:
(3) A foreigner who, following the entry into force of this Act, acquires a hak milik by way of inheritance without a will or by way of joint ownership of property resulting from marriage and an Indonesian citizen holding a hak milik who, following the entry into force of this Act, loses Indonesian citizenship is obliged to relinquish that right within one year following the date the hak milik is acquired in the case of the former or following the date upon which Indonesian citizenship is lost in the case of the latter. If following the expiry of the said time periods, the right is not relinquished, then the said right is nullified for the sake of law and the land falls to the State with the proviso that the rights of other parties which encumber the lands remain in existence.

One has to understand that the period of one year before the land falls to the State doesn't start when and if the State find out of the situation, but from the date the foreigner marries the indonesian lady. It implies that technically the land belongs automaticaly to the state after 1 year of marriage if the couple hasn't transfer the SHM to an eligible person. The words are sharp and let very few roopm to any other interpretention.

Hence my "could" fall to the state without compensation (a mixed couple has one year from the date they marry to avoid this uncomfortable situation, but generally speaking no-one is doing so, by ignorance of the law, or just because so far no jurisprudence enforced the article 21 section 3 for mixed coupled).
Here is more complete and accurate explanation of the article 21 section 3 of the land law.

 

[KaBIm]

I still have the impression that this kind of combination of the two laws is just a speculation of some notaries or lawyers, who want to make things look more complicated than they are in fact (in order to charge extra money for prenups etc.).

Law is a science and does not allow lot of room for speculation. You are entitle to have "impressions", but let me tell you that you are wrong on it. Having discussed this particular matter with some well known indonesian lawyers (who have no financial interest in land law) and professors (one of them was Prof. Safri Nugraha, SH, LLM, Ph.D) in universities (UGM Jogja and Universitas Indonesia -both being among the top leading universities in Indonesia) , they all have the exact same interpretation of the law. A resume of this interpretation has been given in my first post on the topic.
On top of that a prenup correctly drafted has a marginal cost (under IDR 1.000.000 - paid IDR 500.000 for mine) and is nothing in comparaison to the fees charged for other land matters.

Other than that, whether you make it or not, I have never seen either the famous "prenup"

Erm... the prenup, being registered in court and at the CaPil (or KUA depending on the religion of the couple) should appear on the marriage certificate or buku nikah (or the Surat Tand Bukti Laporan Perkawinan) if correctly established. The prenup concern the marriage rules, not specifically land matters (it governs any assets by the way, if you include in a prenup that both spouses are seperate entities). You can for example put in your prenup that you refuse (if you are of ilamic faith), as a wife, that your husband has more than one wife. A prenup is a convention in between a couple that helps subrogate the existing law on various matters.
Just to give you an example: in case of a dissolution of mariage, the judge doesn't give a toss about whose name (husband or wife) is on the SHM. He is evaluating what the asset is worth and divide it by two. In case of a valid existing prenup, establishing two seperate parties, the attitude of the judge is not the same. The SHM remains the sle property of the SHM holder. This is a basic rule applied everyday by indonesian court. A day in a Pengadilan Negeri would suffice to convince you of it. Therefore, even if it is not shown on the land title (and no law ask BPN to include it or not in the SHM), the existence or not of a prenup is what determines who is the real owner of the land. the "harta gono gini" (joint property) is the rule since even before independance (in fact the existing indonesian civil code has been written by the dutch)... Any basic law student should be able to confirm it to anyone having different impression on the topic.

or the "joint ownership" being shown on the land ownership certificates.

Joint ownership is a de facto sitution, implied by both the marriage law and the indonesian civil code. Everyday, indonesian courts pronounce decision reinforcing its jurisprudence, regardless of whose name ion a SHM certificate.
I don't know what to say to further convince you about it. :roll:

The legal risk is a certitude for mixed couple having no prenup, acquiring a SHM title. However, note that I said here (and in quite a few other forums related to the matter) that I don't believe one second that the government will enforce the article 21 section 3 of the Agrarian Law (at least concerning mixed couple, situation may be different for indonesian having embrassed another citizenship). It is not the trend of the law at the moment, which goes toward more acceptance toward foreigners.
However, I believe that saying on a public forum that a prenup for whoever considering marrying an indonesian national is superfluous would be an irresponsible attitude (or at least one that shows poor knowledge/understanding of the law). It costs only IDR 500.000 or so, doesn't hurt and protect you against any change in the interpretation/enforcement of the law.

 

[KaBIm]

The legal basis to establish the ownership is the sale and purchase agreement and not the prenup agreement.

Absolutely wrong. First, such interpretation of the law, not only being against both the Indonesian civil code, the land law and the marriage law is supported by no text in any Indonesian law!? :roll:
It also negates the concept of possession in "good faith" versus possession in "bad faith" for example or negates the fact that there is ways of obtaining a right without taking a positive act. This assumption that the legal basis to establish ownership is only the sale and purchase agreement, is plain wrong and/or naive.

I have quoted all my sources (articles of law + reference of the law) for verification purpose and would be very interested that you quote me anything supporting your assertion/assumption.

 

[KaBIm]

I understand that should Made die before me I have one year to sell our property or it goes to the state. However as we have a son doesn't he inherit it or could I sell to him for a nominal fee? He is Indonesian so I would imagine that ownership wouldnt be an issue.

You are correct in your assumption. Tho' your situation is a bit particular since your kid is not holding dual citizenship and won't have to choose about one citizenship at any time in his life (correct me if I am wrong with your particular situation). I would advise you and Made to make a will, transfering the SHM property to the kid, in the event of Made passing away first, and entitling you a "hak pakai". It would be, IMHO, a good way to preserve both of your rights. Even if both of you are legal heirs, only indonesan can have a hak milik. The SHM real ownership must be clarified in the will, transfring it specifically to the kid.
However, for this particular matter, I would advise you to seek the confirmation of an attorney. It is my "impression" but for personal reason, I have never been very confortable with inheritance topics and have personal trouble researching the matter.

 

[KaBIm]

My daughter holds dual passports, oz and indo... what rights does she have as far as owning property?

Tho' there is yet no jurisprudence to help us answering the question, a lecture of the law should be enough.
Basically:
- The Indonesian Civil Code recognises the right to minors to have legal ownership of assets and fix limits to this right only to unsane people. (article 539)
- The Indonesian Citizenship Act recognises to the kids born from married mixed couples a full right to the Indonesian citizenship (article 4, letter c and d)
- The Constitution of the RI grants the same rights to any Indonesian citizen (article 27, section 1)
- The Land law grants an equal right on land to any citizen of the RI. (article 9, section 2).

Technically, your kid's right is not precluded. However, you have to bear in mind that, when he/she will reach 18 years old (or when he/she will marry, whichever comes first), your kid will enter in the "decision period" were he/she will have 3 years to choose what citizenship he/she wants to keep. Past 21 years old, decision should be taken and only one citizenship should be allowed to him/her. If he/she chooses to become an oz, then any SHM title owned by him/her should be transfered to an eligible person in a delay of 1 year following the date the indonesian citizenship is lost, as per the provision of the article 21, section 3 of the land law.

Putting a SHM in her name at a very young age is may be a way to influence her decision later

 

[KaBIm]

The legal basis to establish the ownership is the sale and purchase agreement and not the prenup agreement.

Just to definitively terminate the above assumption:

i am gonna quote and translate you the first bit of the Article 21, section 3 of the land law that reads:

(3) Orang asing yang sesudah berlakunya Undang-undang ini memperoleh
hak milik karena pewarisan tanpa wasiat atau percampuran harta
karena perkawinan,
A foreigner who, following the entry into force of this Act, acquires a hak milik by way of inheritance without a will or by way of joint ownership of property resulting from marriage

just this bit shows you that the AJB (what you cal the sales and purchase agreement) is in no way the legal basis to establish true ownership, but the Marriage Law and the Indonesian Civl code (its source) are the one governing the matter. The Land law itself acknowledges it. :wink:

Note: the full article 21, section 3 can be found in one of my above post, both in bahasa Indonesia and in a translated version.

Further on and just for your information:

Pasal 119 KUHPer:

Sejak saat dilangsungkannya perkawinan, maka menurut hukum terjadi harta bersama menyeluruh antarà suami isteri, sejauh tentang hal itu tidak diadakan ketentuan-ketentuan lain dalam perjanjian perkawinan. Harta bersama itu, selama perkawinan berjalan, tidak boleh ditiadakan atau diubah dengan suatu persetujuan antara suami isteri.

Article 119 Indonesian Civil Code:

Article 119. From the moment of execution of the marriage, there shall exist by law community of property between the spouses to the extent that no other stipulations have been made in the prenuptial agreement. Rules regarding community property cannot be revoked or amended by mutual agreement between the spouses for the duration of the marriage.

Conclusion: The existence or not of a clear prenup agreement stipulating (or not) that the two spouses are seperate parties is CAPITAL to determine ownership of the land title
AJB (sale/purchase act), in this case is secondary...

Anyway, anyone is entitled to have impressions and to believe that the law is just words that doesn't necessarily apply to them. :wink:

Capeh deh.

 

[Markit]

Again KaBIm we owe you - any charities you have a heart in?

 

[KaBIm]

any charities you have a heart in?

I PM you my account number

 

[goldminer]

So Markit, he is not only smart, he has a sense of humour as well

 

[vandor]

Law is a science and does not allow lot of room for speculation. You are entitle to have "impressions", but let me tell you that you are wrong on it.

I think, you are very wrong with that statement. There are a lot of people who think they are top scientists on legal topics, but have not too much clue about the legal practicalities.

One has to understand that the period of one year before the land falls to the State doesn't start when and if the State find out of the situation, but from the date the foreigner marries the indonesian lady. It implies that technically the land belongs automaticaly to the state after 1 year of marriage if the couple hasn't transfer the SHM to an eligible person. The words are sharp and let very few roopm to any other interpretention.

Where did you here this? If this was true, then, going along a similar logic, in an inheritance case the date of the inheritance would be defined as the death of the deceased. In practice, it may take several years to sort out the inheritance documents, and meanwhile, the inheritor would automatically lose his right to the property.

Luckily, this is not the case. There may have been some stupid people around when they wrote the text of these laws, but any court, which is not insane, would apply all that with reference to the execution date of the inheritance and not the date of the death.

Similarly, „acquiring ownership via joint ownership” refers to the execution of the ownership and not the marriage date. For example, if there is no prenup, and the couple divorces, the alien party can still claim the ownership of 50% of the properties. In that case, if the court decides to grant the ownership right to the alien party, he/she would have a year to relinquish the ownership from the date of executing the court ruling.

This is logical and makes sense. But saying that an alien who does not sign a prenup, “by law and without remedy is forced to own” the property acquired during the marriage, and because of that the state can confiscate the property which is under the Indonesian spouse’s name, does not make too much sense. I guess, not just to me, but to any reasonable Indonesian court.

 

[mimpimanis]

Thank you Kabim for your response. You are right Martin does not hold dual nationality so that should be fine. Although we are all in good health now - I will take your advice and in the not too distant future see a lawyer and arrange to have our wills drawn up.

Does anyone have any idea of the costs to make a will here in Bali

 

[KaBIm]

Law is a science and does not allow lot of room for speculation. You are entitle to have "impressions", but let me tell you that you are wrong on it.

I think, you are very wrong with that statement. There are a lot of people who think they are top scientists on legal topics, but have not too much clue about the legal practicalities.

One has to understand that the period of one year before the land falls to the State doesn't start when and if the State find out of the situation, but from the date the foreigner marries the indonesian lady. It implies that technically the land belongs automaticaly to the state after 1 year of marriage if the couple hasn't transfer the SHM to an eligible person. The words are sharp and let very few roopm to any other interpretention.

Where did you here this?

Didn't I quote and translate you the article of law that implies it?

If this was true, then, going along a similar logic, in an inheritance case the date of the inheritance would be defined as the death of the deceased.

You are mixing up everything. We are not talking about inheritance here, but rules that define ownership in a couple. They are very clear and can not be interpreted in any other way (nor they are interpreted in any other way in any decision of justice take or taken by Indonesian courts): Joint ownerhip of any assets is reputed in a couple, since the first day of marriage, unless there is provisions stating a different rule in a prenup.

This is logical and makes sense. But saying that an alien who does not sign a prenup, “by law and without remedy is forced to own” the property acquired during the marriage, and because of that the state can confiscate the property which is under the Indonesian spouse’s name, does not make too much sense. I guess, not just to me, but to any reasonable Indonesian court.

Find me one decision of justice that supports your claim or even one article of Indonesian law that support it and I'll stand corrected.
I have translated you the article 119 of the Indonesia Civil Code and thought it was enough. Apparently not. But anyway, if you feel that you can rewrite the law in Indonesia or that your personal logic should apply, go ahead. The rules regarding community property cannot be revoked or amended by mutual agreement between the spouses for the duration of the marriage. Do you really think that there is room for interpretation? :roll:
It means that if you do not have a prenup, and if the husband is a foreigner, there is no way to escape (apart by divorce) the law about joint property and its influence on the right to own SHM in a couple.

I note that you eluded my proposal, in one of my earlier post, to submit me any text of law or decision of Indonesian justice helping to support your assertion. Not being very interested in useless polemics I will stop my participation in it, unless of course you decide to come up with some reference of laws or any jurisprudence... However, I believe I can take a rest. :wink:

 

[KaBIm]

Thank you Kabim for your response.

You're welcome. I noted your other question in another thread (concerning KITAS). I'll try to answer it later this week, if noone has answered it before. I am gonna be a bit busy in the next few days.
If I forget, buzz me...

 

[goldminer]

Thanks again for your time and effort KaBIm, much appreciated.
Vandor, give it up! :wink:

 

[bambang]

Law is a science and does not allow lot of room for speculation. You are entitle to have "impressions", but let me tell you that you are wrong on it.

I think, you are very wrong with that statement. There are a lot of people who think they are top scientists on legal topics, but have not too much clue about the legal practicalities.

"Law is a science" funniest thing I have read on this forum in a long time. Kabim and all of his learned friends have this 100% wrong. A simple application of normative jurisprudence would show that.

I have quoted all my sources (articles of law + reference of the law) for verification purpose and would be very interested that you quote me anything supporting your assertion/assumption.

You are making an assertion based on your interpretation of the law which is not supported by any precedent. Then you ask for proof that something doesn't exist. If it doesn't occur in the next 100 years would that be proof?

It could be equally argues that "the proviso that the rights of other parties which encumber the lands remain in existence" negates your assertion. No need though because what you are asserting is an invention.