Quick Guide to Prenuptial Agreements for an Indonesian and Foreigner Couple
What is a prenuptial agreement?
A prenuptial agreement is made prior to a couple getting married. It is an agreement to keep prior ownership of certain assets separate during the marriage. The prenuptial agreement can also keep the ownership of new property separate during the marriage so that there is no new joint ownership of communal assets. Additionally, in the context of marriage to a foreigner, a prenuptial agreement can preserve the right of an Indonesian spouse to own certain company shares and real estate property that a foreigner is not allowed to own.
When is a prenuptial agreement needed for a marriage involving an Indonesian and Non-Indonesian citizen?
When a couple marry under Indonesian law, property obtained during marriage becomes communal property. As such, the property is considered as being jointly owned by the married couple. And any future dealings with the property will require the consent of both parties. If the marriage is between an Indonesian and a foreigner, then there are potential complications in owning certain assets.
What complications may arise for owning property if the marriage is between an Indonesian and a foreigner?
A foreigner is not allowed to own shares in a local limited liability company, nor is the foreign individual allowed to own property that is subject to Hak Milik (Ownership Rights) title or Hak Guna Bangunan (Building Rights) title. Thus, following marriage, the Indonesian spouse is burdened by the legal status of the foreigner he or she marries. And consequently, without a prenuptial agreement, it is argued that the Indonesian spouse cannot legally own certain shares or own certain property. For more information on foreign ownership of a landed house or an apartment, see our Quick Guide to Individual Foreign Direct Ownership of a Landed House in Indonesia and our Quick Guide to Individual Foreign Direct Ownership of an Apartment in Indonesia.
What else should be considered when making a prenuptial agreement?
In the case of a divorce, what is stated in the prenuptial agreements may not reflect the reality of whose money has actually paid for assets purchased by the couple. Also, the prenuptial agreement may not align with the couple’s shared intentions for estate planning.
What about a married couple who does not have a prenuptial agreement?
In 2015, the Constitutional Court clarified that a couple can now legally make a postnuptial agreement. A postnuptial agreement will have the legal effect that the Indonesian spouse can buy certain property that a foreign individual is not allowed to buy. For more information, see our Quick Guide to Postnuptial Agreements.
How long does it take to make a prenuptial agreement?
For a prenuptial agreement, it currently takes about 1 week from drafting to completion of the notarial deed of the prenuptial agreement. The agreement must be registered by the Civil Registration office or Religious Affairs Office (for a Muslim couple), and also registered at the District Court. It takes another 3-4 weeks to receive proof of registration at the Civil Registry or the Office of Religious Affairs, and proof of registration at the District court.
What are the actual deliverables that a client receives when making a prenuptial agreement?
The following deliverables will be received by a client who wishes to make a prenuptial agreement:
What are the required documents for making a prenuptial agreement?
For a prenuptial agreement, the following documents are required:
For the prospective husband and wife:
For the foreign individual:
For the Indonesian Individual:
The above information is based on the following laws and regulations:
This Quick Guide is provided for general information purposes only and should not be considered as legal advice for your specific situation. Should you require legal advice, contact an attorney.
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