Indonesia

Indonesia

New regulation expands strata title rights for foreign citizens and legal entities

02 Feb 2021

On 2 February 2021, Government Regulation No. 18 of 2021 on Right to Manage, Right over Land, Strata Titles and Land Registration (“GR 18/21”) became effective. This Government Regulation amends Government Regulation No. 103 of 2015 on Ownership of Residential Houses by Foreigners Domiciled in Indonesia ("GR 103/15"). Under GR 103/15, foreigners (with stay permits) were only able to own land under Right to Use land title and strata title right to use apartment units or SHPSRS (“sertifikat hak pakai atas satuan rumah susun”). SHPSRS is an ownership of strata title on top of common land with a Right to Use (“Hak Pakai”) title where the apartments were constructed. GR 18/21 allows (i) foreign citizens with the relevant permit, (ii) foreign legal entities with a representative office in Indonesia, (iii) representatives of foreign countries and (iv) international institutions, to own strata title right of ownership of apartment units or SHMSRS, too. SHMSRS is ownership of strata title on top of a Right to Build title of the common land where the apartments are constructed. SHMSRS can only be owned by foreigners if the strata titles are built in (i) specific economic zones, (ii) free trade and free port zones, (iii) industrial zones and (iv) other economic zones.