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     2026:5/3

International Journal of Judicial Law

ISSN: (Print) | 2583-6536 (Online) | Impact Factor: 8.09 | Open Access

Legal Analysis of Land Sale and Purchase Agreements Utilizing Nominee or "Name-Lending" Arrangements Viewed from the Perspective of Positive Law

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Abstract

This study aims to analyze the validity of land sale and purchase agreements in Indonesia that employ nominees or borrowed names, examined from the perspective of positive law. Such agreements are often used to circumvent legal restrictions prohibiting foreign nationals from owning land under freehold title in Indonesia. The research adopts a normative juridical approach by analyzing relevant legislation, court decisions, and legal literature. The findings indicate that land sale and purchase agreements involving nominees are contrary to the Basic Agrarian Law (UUPA), which stipulates that freehold rights may only be held by Indonesian citizens, as stated in Article 21 of the UUPA, which prohibits foreign nationals from owning land in Indonesia. Furthermore, these agreements violate Article 1320 of the Indonesian Civil Code (KUHPerdata) concerning the essential requirements for a valid contract, particularly the requirement of a “lawful cause” consistent with prevailing legal provisions. Even when entered into in good faith, such agreements are deemed invalid as they conflict with legal restrictions on foreign land ownership. Based on judicial decisions, nominee arrangements are considered unlawful and subject to annulment. The study concludes that land sale and purchase agreements using nominees cannot be justified under Indonesian law and that stricter oversight is necessary to prevent legal abuse. It recommends enhancing legal awareness among the public and stakeholders, as well as strengthening policy measures to ensure legal certainty in land sale and purchase transactions.

How to Cite This Article

Sri Ansiska, Muhammad Sood, Aris Munandar (2026). Legal Analysis of Land Sale and Purchase Agreements Utilizing Nominee or "Name-Lending" Arrangements Viewed from the Perspective of Positive Law . International Journal of Judicial Law (IJJL), 5(2), 18-26. DOI: https://doi.org/10.54660/IJJL.2026.5.2.18-26

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