Memorandum Of Agreement For Land Sale Template for Indonesia

The Memorandum of Agreement for Land Sale is a crucial document in Indonesian property transactions, used when parties have reached fundamental agreement on the sale of land but need to formalize the terms before proceeding to the final deed of sale. It serves as a comprehensive preliminary agreement that captures all essential aspects of the transaction, including property details, price, payment terms, and conditions precedent. This document is particularly important in Indonesia due to the country's unique land law system, which combines elements of customary law (adat), civil law, and specific regulations regarding land ownership and transfer. It must comply with the Basic Agrarian Law (Law No. 5 of 1960) and related regulations, while accommodating various types of land rights recognized under Indonesian law. The agreement typically precedes the creation of the Akta Jual Beli (deed of sale) by a Land Deed Official (PPAT) and is essential for both domestic and foreign investment transactions.

1. Parties: Identification and details of the seller and buyer, including their legal capacity to enter into the agreement

2. Background: Context of the transaction, including brief history of the land ownership and purpose of the sale

3. Definitions: Definitions of key terms used throughout the agreement

4. Object of Sale: Detailed description of the land, including certificate number, location, boundaries, and total area

5. Purchase Price: Agreed purchase price and currency

6. Payment Terms: Structure and schedule of payments, including deposit and completion payment details

7. Conditions Precedent: Conditions that must be fulfilled before the sale can proceed

8. Seller's Representations and Warranties: Declarations regarding land ownership, absence of disputes, and authority to sell

9. Buyer's Representations and Warranties: Declarations regarding legal capacity and authority to purchase

10. Completion Process: Steps for completing the sale, including documentation and registration requirements

11. Transfer of Title: Process and timing for the transfer of legal ownership

12. Costs and Taxes: Allocation of transaction costs, taxes, and fees between parties

13. Default and Termination: Consequences of breach and circumstances for termination

14. Governing Law and Jurisdiction: Specification of Indonesian law as governing law and jurisdiction for disputes

15. Execution: Signature blocks and execution requirements