PURCHASING LAND IN INDONESIA

Subsequent to many years of dodgy Land deals and risky property investments for foreigners in Indonesia - Indonesian law is supporting land investment by corroborating security documentation that can now verify and uphold Foreigner's rights in land sale/purchase transactions.

Contrary to rumour, Foreigners can not be listed on an actual Land Certificate this will always have to be an Indonesian citizen or entity, however in stating that there is an established and proven Security documentation procedure that can be put into place to protect the Foreigner's investment.

This process involves a Financial Loan Agreement wherein it is stated that the Foreigner has provided the finance to an Indonesian representative to purchase the Land which consequently shall never be re-paid unless the Land is sold upon authorisation from the Foreign investor and/or in the case of dispute. This in effect gives the Foreigner full financial control over the Land.

In addition to this Agreement we would recommend that a Power of Attorney be executed between the Foreigner and the Indonesian citizen granting full rights to the Foreigner to use, sell and/or lease the Land at will.

A Mortgage can also be placed on the Land as a security option - this entails execution of a Loan Agreement stating the value of the Land and a percentage of that value is calculated to procure the Mortgage in the Foreigners name - this is stamped on a separate Land Certificate and becomes an integral part of the Original Land certificate.

In summary, if the above mentioned security documentation is put in place the purchase of Land in Indonesia by a Foreigner can be a successful and safe investment