Nasoetion & Atyanto Legal Update: Upgrading the Services for the Electronic Registration of the Security Rights over the Land (Hak Tanggungan)

On 6 April 2020, the Minister of Agrarian and Spatial Planning/National Land Agency (“Minister of Agrarian”) issued the Regulation of the Minister of Agrarian No. 5 of 2020 on the Electronically Integrated of the Security Rights over the Land Services (“Minister Regulation No. 5/2020”). This regulation supersedes the previous Regulation of the Minister of Agrarian No. 9 of 2019 on the same subject (“Previous Minister Regulation”). The Previous Minister Regulation was seen as a breakthrough from the Minister of Agrarian to improve the service quality of his department to the public. The use of electronic means for the registration of the security rights over the land (“Hak Tanggungan”) and administering other activities related to Hak Tanggungan will establish a more efficient process compares to the conventional method.

Minister Regulation No. 5/2020 provides updates on some practical issues that arose under the Previous Minister Regulation, such as the legal subjects that may utilize the electronic system of the Hak Tanggungan and the mechanism of the registration of Hak Tanggungan for the second rank creditor onwards, which we will further discuss below.

A. GENERAL PROVISIONS AND SCOPES OF THE REGULATION

Minister Regulation No. 5/2020 defines the Electronic Integrated Hak Tanggungan Services (“HT-el Services”) as a series of processes of the Hak Tanggungan services in the framework of the maintenance of the land registration data, which implemented through an integrated electronic system. The Integrated Hak Tanggungan Electronic System (“HT-el System”) means the integrated electronic system developed by the technical unit, which has the duty in the field of data and information to process the HT-el Services.

The services that may be submitted through the HT-el System comprise the followings

  1. the registration of Hak Tanggungan;
  2. the transfer of Hak Tanggungan;
  3. the change of the creditor’s name;
  4. the deletion of Hak Tanggungan (Roya); and
  5. the data correction. 

Since the enactment of this new regulation, all applications related to those services shall be submitted and processed through the electronic system, unlike in the Previous Minister Regulation, in which the application process may still involve the manual submission to the Land Office.

B. THE IMPLEMENTATION OF THE HT-EL SYSTEM

The Ministry of Agrarian and Spatial Planning/National Land Agency (“Ministry of Agrarian”) shall be the administrator of the HT-el Services. The users of the services are the creditors, Land Deed Officials, or other parties determined by the Ministry of Agrarian. Minister Regulation No. 5/2020 mandates the Land Offices to be the executor of the services.

Minister Regulation No. 5/2020 allows any creditors, either individual or legal entity, to become a registered user of the HT-el Services. This provision broadens the scope of the creditors, which previously was limited to only individual or legal entity that have a registration certificate from the Indonesia Financial Services Authority (Otoritas Jasa Keuangan), which implies that the creditors who could be the user of the HT-el System are only banks and financial services institutions.

C. THE MECHANISM OF THE HT-EL SERVICES

The application documents for registration or transfer of Hak Tanggungan must be submitted by the Land Deed Officials. On the other hand, the application documents for change of creditor’s name, deletion of Hak Tanggungan, or data correction shall be submitted by the creditors. All required documents for the use of the HT-el Services shall be submitted in the form of Electronic Documents. Unlike in the Previous Minister Regulation, the Minister Regulation No. 5/2020 no longer requires the land certificate that will be the object of Hak Tanggungan to be in the name of the borrower. The HT-el System will receive and process the application for registering Hak Tanggungan over the land owned by the borrower or a third-party security grantor.

The registered users shall submit the deed of the granting of Hak Tanggungan and other documents, including the statement letter declaring the validity and truthfulness of the filed Electronic Documents. HT-el System will issue a receipt once it receives the application. The users of the HT-el Services are subjected to a particular fee determined under the prevailing laws and regulations regarding the Non-Tax State Revenue applicable in the Ministry of Agrarian. HT-el System will process the applications only after receiving the fee payment.

The Head of the Land Office or other appointed officials must examine the compliance of the filed documents with the requirements and the concept of the HT-el Certificate. If there is any incomplete or non-comply document, the system shall notify the registered user, and the user must complete the request at the latest by the fifth day since the HT-el System started the process. If the registered user does not fulfill the request within the prescribed period, the system will void the application. The Head of the Land Office or the appointed officials may issue its approval if all filed documents comply with the requirements.

The result of the HT-el Services comprises the HT-el Certificate, the annotation of Hak Tanggungan in the land book, and the annotation in the land certificate. HT-el Certificate will be issued on the seventh day since HT el-System confirmed the application of the HT-el Services. Application results will be sent to the Creditors by HT-el System and/or Electronic Domicile.

HT-el Certificate holders are prohibited from (i) changing the contents, manipulating, creating, altering, omitting, destructing the electronic information and/or Electronic Document to make as if such electronic information and/or Electronic Document is authentic and (ii) duplicating, distributing or transmitting, moving or transferring, causing the disclosure of the electronic information and/or Electronic Document to any parties who are not relevant to the Hak Tanggungan. Any violation of such prohibition will be subject to sanctions in accordance with the prevailing laws and regulations.

Minister Regulation No. 5/2020 stipulates that the recording of Hak Tanggungan in the land book shall be performed by the Land Office, whereas for the recording of Hak Tanggungan in the land certificate shall be performed by the creditor. These provisions are different from the provisions under the regulation with higher hierarchy that is Law No. 4 of 1996 on Hak Tanggungan (“Hak Tanggungan Law”), which requires that the registration of Hak Tanggungan shall be performed by the Land Office by annotating the Hak Tanggungan in the land book and recording of such data in the land certificate. It is unclear whether the recording of Hak Tanggungan in the land certificate by the creditors require a further electronic signature from the Land Office to comply with Hak Tanggungan Law.

If the Head of the Land Office or appointed officials do not examine the application documents until the seventh day since the system started the process, the HT-el System will automatically generate the approval or validation to the applicant. The Head of the Land Office or the appointed officials shall be deemed to approve and validate such application. This provision emphasizes that the officials are administratively responsible for the issuance of the result of the HT-el Services that may have been through without a proper examination procedure.

Further, for the application of the second rank Hak Tanggungan onwards, the HT-el Certificate will be issued in the new registration number, while for the transfer of Hak Tanggungan, change of creditor’s name, deletion of Hak Tanggungan, or data correction will be issued in the same registration number but with the latest data changes. This provision clarifies the obscurity on whether the second rank onwards creditor can be registered in the HT-el System, wherein the Previous Minister Regulation, does not provide such clarity.

For the deletion of the Hak Tanggungan in the HT-el System, Minister Regulation No. 5/2020 still only acknowledges the full repayment as the basis for the application of the deletion of Hak Tanggungan, while Hak Tanggungan Law provides another basis for the deletion of the Hak Tanggungan. Further, in the event of the occurrence of mistakes in the data entered in the application, the registered user may submit the application for the data correction in the HT-el System no later than thirty days since the date of issuance of the HT-el Certificate and such correction shall be subjected to a particular fee.

D. THE REJECTION/CANCELATION OF THE SERVICE

The Head of the Land Office may reject the HT-el Services, among others, if there is confiscation and/or blockage within the period of the HT-el Services process, or if there is another reason provided under the prevailing laws and regulations. The rejection shall be notified to the creditor through the HT-el System, Electronic Domicile, and/or other electronic media.

The Land Office must implement the Minister Regulation No. 5/2020 by 8 July 2020. Afterward, all Hak Tanggungan services may only be conducted electronically. However, for Hak Tanggungan that has been issued manually before the promulgation of Minister Regulation No. 5/2020, the next services may be conducted electronically through the media transfer, and such services shall be subjected to a particular fee. It is expected that moving forward, the implementation of the electronically integrated system for Hak Tanggungan would provide more reliable and punctual services.

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AUTHOR


Genio Atyanto

Partner

Aldi Prapanca

Associate