President Joko Widodo (Jokowi) announced plans to allow investors to invest in Nusantara (IKN), Indonesia’s new capital, for up to 95 years.
This policy is outlined in Government Regulation No. 12 of 2023, entitled “Giving Licensing, Ease of Business, and Investment Facilities for Businesspeople in Nusantara’s Capital City,” and is effective on March 6, 2023.
With the Cultivation Rights regulation, Jokowi granted investors the opportunity to invest in the new city over a period of decades (HGU).
“The period of HGU* (Hak Guna Usaha) above the Management Rights (HPL) of the Authority of the Capital City Nusantara is given no later than 95 years through one cycle,” wrote Article 18 PP 12/2023.
Long-term business in one cycle is divided into several stages.
- First, granting rights for a maximum of 35 years.
- Second, you can extend rights for a maximum period of 25 years.
- Third, you can update rights for a maximum period of 35 years.
“HGU given for the first cycle with a maximum period of 95 years as referred to in paragraph (1) is outlined in the decision to grant rights and recorded in the HGU certificate,” contents Article 18 paragraph 2 of the regulation.
As for the extension and renewal of HGU, they can be issued all at once if the HGU is used and utilised efficiently in accordance with the aim of awarding rights after five years.
Furthermore, the businessperson could request for HGU re-granting for the second cycle with a maximum length of 95 years in compliance with the land use agreement within a 10-year grace period before the first cycle of HGU ended. – President Jokowi Grants up to 95 Years of Business Rights to Investors in Jakarta
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