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| |Hak Guna Bangunan crisspoll
, Hak Guna Usaha crisspoll
The holder of Hak Guna Bangunan ("HGB") is entitled to construct and own buildings or other structures on the land. This is the most common title for residential, commercial and industrial properties. This title can be owned by individuals of Indonesian nationality, and Indonesian legal entities including foreign capital investment (PMA) and domestic capital investment (PMDN) companies (as described more fully in Section II below.)
In principle, the right is granted for an initial period of up to 30 years, although it may be extended for another 20 years. Based on Government Regulation No.40 of 1996 regarding HGU, HGB and Hak Pakai ("GR 40/96"), an approved capital investment company (i.e., a PMA or PMDN company) may obtain HGB rights for a period of 80 years (i.e., 30-year initial term, plus 20-year extension term, plus 30-year renewal term) by payment of certain up-front official costs ( Uang Pemasukan).
Like Hak Milik, HGB can be sold, gifted, exchanged, by an Indonesian bequeathed, and/or encumbered mortgage. crisspoll
Hak Guna Usaha ("HGU") is a right granted over State land to exploit the soil, and is the principal title used for agricultural projects, including plantations, fisheries and cattle ranches. The owner is also entitled to construct buildings and structures on the land related to such agricultural uses.
HGU may be held by Indonesian citizens and by legal entities established under Indonesian law, including PMA and PMDN companies.
In general, HGU is granted for an initial period of up to 35 years, and may be extended for a further 25 years. The provisions of GR 40/96 also apply to HGU titles, thereby allowing PMA and PMDN companies longer term certainty with respect to their land rights. HGU titles cannot be granted on areas of less than five hectares, and special rules apply for areas over 25 hectares.
This right can also be sold, gifted, exchanged, bequeathed, and/or encumbered. crisspoll
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