Role Difference Between Public Notary and PPAT in Property Transaction
When dealing with Indonesia’s property legalities, we are often advised to use PPAT and Notary service. But who are they? What type of assistance they could offer?
When we want to buy or sell property, we often hear that we need to use notary and PPAT services. Notary and PPAT services are needed in the process of buying and selling property. Their assistance is mandatory because they both have the authority to administer several documents and guarantee the legality of transactions.
Although both are often written on the same signpost, Notary and PPAT are two separate legal entities with different functions and duties.
What is a Notary?
Notary is a public official who is authorized to make authentic certificates and has other powers as referred to in the Law on Notary (Undang-Undang Jabatan Notaris (UU No 30/2004)) or based on other laws, namely:
- Authorize signatures and specify the date of the letter under the hand by registering in a notary record (referred to as Legalisir/ legalization).
- Record a non-authentic document letter in a notary record (referred to as waarmerking/Registration).
- Making authentic certificates of agreements or provisions.
- Make copies of the original non-authentic document (referred to as copie collatione).
- Providing legal education in connection with making certificates.
- Making certificates related to land.
- Prepare a certificate of auction minutes.
- Correct typographical errors and/or typos contained in the minuta certificate or certificate signed by the parties to the original certificate stating the date and BA number of correction, and the copy is sent to the parties.
Notary’s work area is in the realm of private law, making certificates or agreements between citizens, citizens and institutions, and citizens and the government. The agreement is related to land, kinship, or marriage.
In the Regulation of the Minister of Law and Human Rights No. 62 of 2016 (Peraturan Menteri Hukum dan HAM No. 62 Tahun 2016) concerning Amendments to the Regulation of the Minister of Law and Human Rights No. 25/2014 (Peraturan Menteri Hukum dan HAM No. 25 Tahun 2014) concerning Terms and Procedures for the Appointment, Transfer, Dismissal, and Extension of the Office of Notary Public, to become a notary, a person is required to have a bachelor degree in law and a master degree in notary.
Based on Article 1 Number 13 Decree of the Minister of Justice and Human Rights No.M-01.H.T.03.01 Year 2003 (Pasal 1 Angka 13 Keputusan Menteri Kehakiman dan HAM No.M-01.H.T.03.01 Tahun 2003) regarding Notary, the only notary organization recognized by the government is the Indonesian Notary Association (INI). This is the only organization that issues a notary code of ethics that applies to all notaries in the exercise of their positions.
What is PPAT?
PPAT or land deed conveyancer is a public official who has the authority to make legal documents regarding certain legal actions on land or ownership rights over flat units. In short, the scope of PPAT’s authority is narrower than that of a Notary. 8 types of PPAT deeds or certificates serve as legal evidence and the basis for changes to land registration data (Article 95 paragraph 1 Regulation of the Minister of Agrarian Affairs / KBPN (Permenag / KBPN) No. 3 of 1997 in conjunction with Article 2 paragraph 2, Per KBPN No. 1 of 2006 ) namely:
- Sale and Purchase Deed
- Deed of Exchange
- Deed of Grant
- Deed of Entry into the Company (inbreng)
- Deed of Sharing of Rights
- Deed of Granting Right to Build / Use Rights over Freehold Land
- Deed of Granting Mortgage Rights
- Deed of granting power of attorney to impose mortgage rights
PPAT is guided by Government Regulation No. 37/1998 (Peraturan Pemerintah No. 37/1998) concerning Regulations on the Position of Land Deed Making Official (PPAT). In it, it is explained that PPAT is a public official who has the authority to make certificates regarding certain legal actions over land or ownership rights over apartment units. In short, the scope of PPAT’s authority is narrower than that of a Notary.
The PPAT regulations refer to PP 24/2016 which regulates the terms of appointment, prohibitions for PPAT, and the scope of PPAT authority in carrying out its profession. To be appointed as PPAT, a person must have a law degree and a bachelor’s degree in notary or at least have passed the PPAT special education program organized by the Ministry of Agrarian Affairs.
It is stated in Article 12 paragraph (1) of PP 37/1998 (Pasal 12 ayat (1) PP 37/1998) that the working area of a PPAT is the area of Land Office of the District / Municipal Level II Region (Kantor Pertanahan Kabupaten/Kotamadya Daerah Tingkat II). Therefore, for the management of the transfer of land rights located in region A, it must be done through a PPAT domiciled in region A.
Differences in the Work of a Public Notary and PPAT
Based on Article 15 paragraph (1) of the Law on the Position of Notary (Pasal 15 ayat (1) Undang-Undang Jabatan Notaris), a notary has a way of working following statutory regulations and/or what the interested parties want to be stated in an authentic certificate, such as:
- Guarantee the certainty of the certificate creation date
- Certificates have a deviation
- Provide Grosse and copies and excerpts of certificates.
All this is done as long as the certificate is not assigned to another official stipulated by law.
Meanwhile, a PPAT’s work is focused on land registration activities in making certificates as evidence of certain legal actions regarding land rights or property rights over flat units, which will later be used as the basis for registering changes in land registration data caused by these legal actions.
Requirements for the validity of authentic certificates
For a certificate declared as authentic and valid, the certificate must meet the formal and material requirements.
1. Formal Terms
- The certificate is made by the authorized official. This means that we must understand the respective authority of the notary and PPAT. Do not let a certificate that should only be legalized by a notary, made by PPAT or vice versa.
- At the place where the official is domiciled. PPAT has jurisdiction, make sure to use the PPAT of the appropriate regions.
- iii. Signed by the party present according to the date stated on the certificate. Certificates are usually signed by sellers, buyers, witnesses, and notaries. Make sure all processing and signing are done at the same time.
2. Material Requirements
What is called a material requirement is that the content or material in the certificate is true or factual. For example, make sure that the size of the property you are buying and selling matches the letters. For example, the certificate of ownership stated the object is 8×12 meters of land, while it is written 7×12 meters in the certificate. Do not make any mistakes in writing the address, or house number.
Situations where it is mandatory to use the services of a notary or PPAT
Here are some property transaction scenarios that must use the services of a notary:
- Buying and selling property using a credit process, either from Home Ownership Credit (KPR) or cash in stages through the developer
- There are situations where it is mandatory to use a Sale and Purchase Agreement (PPJB)
- If there is a document that has not been completed (PPB has not been released or ownership transfer process is required)
We must use PPAT services in the process of buying and selling a property when:
- The buying and selling process is not done on credit but is done in cash
- All property papers have been completed
Here are some legal documents regarding property transactions that must be owned and under which legal service it has to be made
- Sale and Purchase Agreement (Perjanjian Pengikatan Jual Beli or PPJB)
In general, PPJBs are made underhand only, but PPJBs may be made with a notarial certificate.
- Binding Buying and Selling (Pengikatan Jual Beli or PJB)
PJB is an agreement between the seller to sell his property to the buyer made with a certificate from a notary.
- Certificate of sale & purchase (Akta Jual Beli or AJB)
AJB is an authentic certificate made by PPAT for the transfer of rights to land and buildings. The making of AJB has been regulated through the Regulation of the Head of the National Land Agency (Perkaban) No. 08 of 2012 concerning Land Registration (Peraturan Kepala Badan Pertanahan Nasional (Perkaban) No. 08 Tahun 2012 Tentang Pendaftaran Tanah).
(Read here for legal documents you need to know)
Even though there are indeed many Notaries who are PPAT and vice versa, we should identify which documents should be handled by a Notary and which ones are handled by PPAT to avoid fraud from the seller or developer.