The Indonesian Government has issued Regulation No. 12 of 2023 on Business Licensing, Ease of Doing Business, Investment Facilities for Business Players in the State Capital ("Regulation"), which provides incentives to encourage domestic and foreign investment in the country's new capital city, Nusantara, currently being developed in Kalimantan. The Regulation establishes a simplified process for obtaining land titles for non-governmental activities and grants guaranteed land tenure for one cycle, including initial tenure, extended tenure, and renewed tenure, for investors in Nusantara. Moreover, the tenure for these land titles is significantly longer than the tenure for such land titles outside Nusantara under the 1960 Agrarian Law.
In terms of living in Nusantara, the Government allows Indonesian citizens to own freehold land in Nusantara, while foreign citizens can own landed housing by obtaining a right to use on a land title. However, they cannot buy, own, and/or possess government aid housing in Nusantara. It remains unclear whether a transfer of land title involving a land previously classified as an asset controlled by OIKN (aset dalam penguasaan otorita ibu kota negara or "ADP") (ex-ADP land) still requires the State Capital Authority's approval. The move of the capital aims to attract investors to Nusantara and to relieve the overpopulation, traffic congestion, and environmental degradation faced in Jakarta.
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