Presidential Decree On IKN Development Acceleration Issued, Jokowi Sells HGU to Investors for up to 190 Years

IKN (Photo: Antara)

JAKARTA - The government has issued Presidential Regulation (Perpres) Number 75 of 2024 concerning the Acceleration of Development of the Nusantara Capital City or IKN. This regulation was signed by President Joko Widodo (Jokowi) on Thursday, July 11 2024.

Through Article 9 of Presidential Decree 75, Jokowi officially granted business use rights (HGU) permits for investors in IKN with a maximum term of up to 190 years.

"The business use right is for a maximum period of 95 years through the first cycle and can be re-granted for a second cycle with a maximum period of 95 years based on the criteria and evaluation stages," reads Article 9 paragraph 2 (a).

Apart from HGU, building use rights or HGB are also granted for a maximum period of 80 years through the first cycle. Then, it can be given again through a second cycle with a maximum period of 80 years based on the criteria and evaluation stages.

Then, in paragraph 2 (c) it is stated that the right to use is for a maximum period of 80 years through one first cycle and can be re-granted through a second cycle for a maximum period of 80 years based on the criteria and evaluation stages.

"The granting of land rights through the first cycle as intended in paragraph 2 is carried out by the ministry that carries out government affairs in the agrarian/land sector based on a request from the Nusantara Capital Authority," reads Article 9 paragraph 3.

Paragraph 4 also states that the Nusantara Capital Authority (OIKN) will carry out an evaluation five years after the granting of the first cycle of rights regarding the fulfillment of the requirements: (a) the land is still being cultivated and utilized properly in accordance with the circumstances, nature and purpose of granting the rights; (b) the rights holder still meets the requirements as a rights holder; (c) the conditions for granting rights are fulfilled by the rights holder; (d) the use of the land is still in accordance with the spatial plan; (e) the land is not indicated as abandoned.

Apart from regulating HGU and HGB, this Presidential Decree also regulates the provision of incentives and business licensing facilities. These facilities can be provided to business actors who carry out development of the provision and management of basic and/or social services as well as commercial facilities.

"The provision of incentives and Business Licensing facilities as referred to in paragraph (1) is carried out by the Nusantara Capital Authority, ministries/institutions and/or Regional Governments in accordance with the provisions of statutory regulations," reads paragraph 2 of the regulation.