Guidelines for Addressing Objections and Deposit Compensation Relating to Land Procurement

The Supreme Court (Mahkamah Agung– “MA”) has issued Regulation No. 3 of 2016 on Procedures for the Submission of Objections and Compensation Deposits to District Courts for Cases Involving Public-Interest Construction Projects(“2016 Regulation”).The 2016 Regulation sets out the procedures to be followed by parties who are intending to challenge the type or amount of compensation awarded for a given process of land acquisition undertaken by government institutions in the public interest at District Courts (“Court”). Additionally, the 2016 Regulation also details the procedures to be followed when government institutions deposit such compensation with the Court.The 2016 Regulation is of relevance to the public, government institutions, and/or private entities which are involved in land procurement in the public interest.Compensation Challenges: Types and AmountsAccording to Law No. 2 of 2012 on Land Procurement in the Public Interest, governors and regents/mayors are authorized to determine land location as regards the implementation of construction projects which are deemed to be in the public interest. The value of any land and fixtures which are to be subject to such an acquisition process is to be determined by an independent appraiser appointed by the Land Agency Office.Upon being informed of a value for the land and fixtures in question by the appraiser, the government will then arrange a process of negotiation (“Negotiation”) which will ultimately lead to the offering of compensation to the entitled party (“Entitled Party”). Entitled Parties encompass holders of land titles or management rights, trustees (nadzir) orwaqf, owners of land that previously belonged to an indigenous community, parties who have taken possession of an area of state land in good faith, land-tenure holders, and owners of buildings, plants, or other objects which relate to a certain area of land. [1] If the Entitled-Party refuses the amount of compensation being offered, then they may file a lawsuit with the registrar of the Court in the area in which the land is located. This lawsuit must be filed within 14 days of the Negotiation process being held and should outline the following: [2]