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3.2.1 The Basic Agrarian Law No. 5 / 1960 The BAL or Undang-Undang Pokok Agraria Nomor 5 Tahun 1960 (UUPA) is based on Article 33 of the 1945 Constitution (Undang-Undang Dasar 1945) of the Republic of Indonesia, and on Principle 5 of the state philosophy of Pancasila.[FN 13] In Chapter XIV, Article 33 of the Constitution, Paragraphs 2 and 3 state: "Branches of production which are important for the State, and which effect the lives of most of the people, shall be controlled by the State" and "Land and water and the natural resources found therein are controlled by the State and are utilized to the fullest extent for the greater prosperity of the people."[FN 14] Principle 5 of the Pancasila specifies: "that to provide a just and prosperous society, adequate supplies of food and clothing must be provided for the populace."[FN 15] The Basic Agrarian Law (BAL) is made up of 67 articles divided up into four chapters covering:[FN 16] 1.) Basic Principle and Provisions 2.) The Rights to Land, Water and Air Space, and Land Registration 3.) Penal Provisions 4.) Transitional Provisions The basic principles of the BAL are summarized in Box 1.[FN 17] What were the basic alterations to the previous legislation for the new BAL: The new BAL [FN 18] "substituted a single code based on Indonesian traditional (adat) law purified from feudal and capitalistic elements" and "the new legislation qualified indigenous law in various ways, although in vague terms, such as that it must not be contrary to national interests, contrary to Indonesian socialism, contrary to other agrarian legal precepts or contrary to religious law and that it would be founded on national unity". Adat land rights acquired before the enactment of the BAL are fully protected and can be registered and titled under the new system.[FN 20] It is, however, significant that "in all land matters the BAL would govern and take precedence over the Adat system of land law."[FN 21] The new Agrarian Law comprises two important alterations of the previously valid land regulations. For one thing it canceled the old land registration, titling laws and regulations. This led to the dissolution of the existing dual legal system (western law and adat law), and to the introduction of a new system of land law of unique Indonesian applicability. Land which was originally registered under western law could "be converted to the new system, but failure to do this would lead to forfeiture, with the land reverting to state ownership."[FN 22] For another thing, a new Agrarian Law was developed whereby in particular "a system of land rights with varying degrees of tenure and with different citizenship requirements determining the type of right to be granted." [FN 23] The fixing of ceilings and the exclusion of foreigners from land ownership should protect the autochthonous Indonesian citizens from economically stronger groups. [FN 24]
Box 1: Principles of the Basic Agrarian Law [FN 25]
A further ruling of the BAL is the establishment of upper ceilings of land ownership and that the government authorities, in cases where these limits are exceeded, have the possibility of taking the surplus land for redistribution.[FN 26] The government passed a regulation on 24th December, 1960 as an implementation of Article 17 of the BAL, which planned both minimum and maximum land ownership. A minimum limit of ownership of agricultural land of 2 ha was established since the Government assumed that 2 hectares would be enough for the needs of a family. This was supposed to avoid further fragmentation of agricultural land. Further, there are regulations for avoiding absenteeism amongst landlords. "A landowner cannot control - through ownership, land pledge, or lease - agricultural land outside the subdistrict or adjoining subdistrict in which he or she controls more than 2 hectares."[FN 27] The establishing of upper ceilings and the exclusion of foreigners was meant to protect the autochthonous Indonesian citizens from economically stronger groups.[FN 28] After the introduction of the BAL, a land reform was carried out in the following years (1961 - 1965). The land reform in Indonesian is seen by many land law experts as a failure. RAJAGUKGUK writes: "Land reform ... can be considered a failure because the provisions were unrealistic, administration and financial planning could not support a successful program, and political differences between Communist and non-Communist factions intensified during this period."[FN 29] In the following section, the rights which are established by the BAL will be more closely explained:[FN 30] The right of ownership (hak milik): The right of ownership is the strongest right to land. Hak milik is not limited in terms of time. The land can be sold, mortgaged and can be inherited by the legal heirs. However, the owner must take the "social function" of land into consideration. Hak milik is subject to registration. The land owner receives a legal document as evidence of his rights (Sertipikat). As well, hak milik can be acquired in various different ways:
Only Indonesian nationals are able to receive hak milik. As a rule, hak milik is awarded to individuals, however in exceptional cases under certain preconditions, certain corporate bodies (state banks, cooperative agricultural associations, religious and social institutions) can be awarded the right of ownership.[FN 34] Foreigners are excluded from this right. [FN 35] The right of exploitation (hak guna usaha) Hak guna usaha is the right to State land, and the right to use the land for agricultural (including plantations), fishery and breeding purposes. Hak guna usaha is limited timewise. It can, for example, be granted for an oil palm plantation for up to 35 years, with the possibility of extending for another 25 years. So, de facto, hak guna usaha on state lands can be awarded for up to 50 or 60 years. Some of the regulations of the hak guna usaha have their origins in the "erfpacht rights"[FN 36] which was valid before the BAL came into effect. Hak guna usaha can acquired by Indonesian individuals and corporations established under Indonesian Law and domiciled in Indonesia. There is no maximum area of land which can be awarded under hak guna usaha. Hak guna usaha must likewise be registered at the Land Registry Office. Hak guna usaha can be bequeathed and likewise be transferred to other parties (sale, exchange or gift) with the permission of the BPN. Hak guna usaha also allows land to be used as a security for a debt.[FN 37] The right of building (hak guna bangunan) Hak guna bangunan gives the holder the right to build on land owned by someone else. This right is limited timewise and can be obtained for state land (by decree) as well as for private land (by contract). It is awarded for not longer than 30 years, but there is the possibility of extending for another 20 years. So far there are no regulations which hinder a further extension. There are maximum area limitations. So far there are no implementation regulations for registration.[FN 38] Hak guna bangunan can be bequeathed, sold, exchanged or presented as a gift. Hak guna bangunan can likewise be used as a credit security. The right of use (hak pakai) Hak pakai gives the holder the right to use a particular piece of land. This can be State or private land. In practice, this right is scarcely made use of for privately owned land since other titles, such as the right of lease, or right of land pledging, play a greater part here. Hak pakai is basically limited timewise. Hak pakai can in principle be transferred when no other regulations apply. Resident foreigners and foreign corporations with representatives in Indonesia can be awarded hak pakai. Hak pakai for private land does not get registered because of the lack of implementing regulations. The right of lease (hak sewa) There is a differentiation here between hak sewa bangunan (right of lease for buildings) and hak sewa pertanian (right of lease for agricultural land).[FN 39] In the first case, a building can be erected on someone elses land for a specific but not fixed time by paying a monthly lease. This is a case of a personal right. Hak sewa is created between land owner and lessee with a contract. In the case of hak sewa pertanian, land must be used for agricultural purposes, and the lease can be paid in either cash or kind.[FN 40] The right of opening up land (hak membuka tanah) Hak membuka is awarded by the Government to Indonesian citizens for clearing land, and to use the land for a maximum of three cultivation periods. Hak membuka tanah can later be changed into hak pakai, hak guna usaha or hak milik. The right of collecting forest products (hak memungun hasil hutan) Hak memungun hasil hutan is awarded to Indonesian citizens by the Government on adat land in order to be able to use wood and other non-wood products. The right of landpledge (hak gadai) Hak gadai is a way for the land owner to receive money without having to sell his land. He transfers his right of use to another person who in return pays money to the land owner. The land owner gets his land back when he has paid back the loan. This is known as a land pledge (djual gadai). The pledge arrangement is only rarely conducted before the village head, and is usually unwritten. There is no time limit in which the land owner has to pay back the money in order to get back his land. The right of sharecropping (hak usaha bagi hasil) Hak usaha bagi hasil is restricted to agricultural purposes. Hak usaha bagi hasil is governed by Law No. 2 / 1960 (shares, duration). In practice, these Regulations have not always been implemented (see also Paragraph 3.5.). The right of lodging (hak menumpang) Hak menumpang is a weak right of use. It allows someone to own a house on someone elses land. The duration of the right is not fixed. Hak menumpang is governed by the local Adat law.[FN 41] The right of using water (hak guna air) Hak guna air is an Adat-based right which allows access to water on another persons land and / or to divert water across another persons land. The right of breeding and catching fish (hak dan pemeliharaan penangkapan ikan) Hak pemeliharaan dan penangkapan ikan is the right to breed fish and to catch fish on another persons property. The right of using the air space (hak guna-ruang angkasa) Hak guna ruang angkasa is a right, and not a very clear one, for using energy and elements available in the atmosphere. |