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MARRIAGE AGREEMENTS

Category: Notary Services, Estate Planning Services
Written by Riska Destriyanti on 30/06/2022
The author’s views are entirely their own and may not always reflect the views of Putranto Alliance.

A marriage agreement is one of the preparations in building a household before nuptial ceremony. This kind of agreement usually arranges everything about marital assets, jointly or personally owned by one of the spouses. It has become common for couples to have prenuptial agreements in Indonesia. Many couples realize that a prenuptial or postnuptial agreement may be one of the best ways to protect their financials, custody of their children, and assets if things go south.

With this service, we can assist you in drafting these agreements, making changes to previous agreements, and registering them with the relevant authorities. We ensure proper administrative processes so that these agreements are enforceable in the future.

Marriage Agreements in Indonesia

Marriage Agreements refer to Law Number 1 of 1974 on Marriage (known as Marriage Law). Article 29 (1) of the Indonesian Marriage Law initially provides that a husband and wife can only make a marriage agreement before or on the date of marriage, known as Prenuptial Agreement.

However, later, the Indonesian Constitutional Court’s Number 69/PUU-XIII/2015 allowed a husband and wife to make marriage agreement during the marriage period, which is known as a Postnuptial Agreement.

In short, a marriage agreement is an agreement made by a couple before or after marriage to regulate their assets.

Many Indonesians disregard marriage agreements since they believe marriage is sacred and divorce separation is highly discouraged by society. However, divorce separation is common in society, and disputes regarding assets and children often appear as big issues. The agreement is essential to prevent the dispute.

The Marriage Law regulates assets which include 2 things:

Asset obtained during marriage as a joint asset; and
Each couple's asset, and asset obtained by them as a gift or inheritance, is under the supervision of each party.

Couples can deviate from the rules of the joint asset by making a marriage agreement whose contents are according to law, religion, and morality.

A marriage agreement has many benefits for couples because it protects assets and/or property that will be or already owned. If one party is in trouble, the partner’s assets and/or properties will not be affected by the other party. The agreement is also considered as a preventive measure as it will facilitate the distribution of assets when a dispute that leads to divorce happens.

A marriage agreement is made with a deed before a notary and registered to the Civil Registry Office. After the agreement is recorded, it applies as law to the couple and third parties.

The Importance of Marriage Agreements

Here are some of the reasons for couples to consider making marriage agreements:

Confirming financial rights and responsibilities;
Preventing post-divorce conflicts and arguments;
Protecting from spouse's debts;
Dividing assets clearly among family members, such as spouse and children; and
Protecting their property in Indonesia.

The purposes of making the agreement are:

If each party owns a business and one of them fails or bankrupts, the spouse cannot contest the other's assets;
If, before or after marriage, one of the parties has debts, then it is only borne by that party;
There is a separation of assets or properties owned before and after marriage;
You can still own land and buildings in Indonesia even if after marrying a foreigner; and
Children's needs are more secure.

Based on Article 139-142 of the Civil Code, some prohibitions when making the agreement are:

Must not conflict with morality and public order

Couples can deviate from laws and regulations as long as they do not conflict with morality, public order, general rules, and applicable provisions.

Cannot reduce husband's rights

The agreement may not reduce the rights of the husband, either as a husband, as a father, as the head of the household, or other rights.
It is not allowed to regulate inheritance

Any content that implies relinquishing their rights to inheritance from their descendants is not allowed.
It is not allowed to incriminate one of the parties regarding the debt

Any content of agreement that makes one party obliged to pay a debt bigger than the profit they can obtain from the assets or property is not allowed.
It is not allowed to use Law outside Indonesian Law

Any agreement that a couple's marriage bond will be regulated by foreign law is not allowed. They can only use Indonesian law or other regulations.

Types of Marriage Agreements

There are two types of marriage agreements that apply in Indonesia, namely:

Prenuptial Agreement; and
Postnuptial Agreement.

The differences between the two of them are when do the couple made the agreement, the validity, and the procedure for recording it.

Those agreements, both prenuptial and postnuptial agreements, also give extra protection. Some couples think they don’t need it in the early course of their marriage, but it will become a strong protection when a divorce occurs.

A prenuptial agreement is a written contract created by two people before marriage. It also applies directly to the parties after a notary ratifies the agreement. However, the agreement must be registered to the Civil Registry Office if a third party applied to it.

A postnuptial agreement is a legal contract created for married couple in Indonesia during their marriage period. This agreement will divide how the their assets and income when they separate.

This agreement is valid and binding on the husband and wife. The validity of this marriage agreement is not retroactive, meaning that the separation of assets only applies to assets obtained after the postnuptial agreement is made. Assets obtained before the agreement are still considered joint assets.

Meanwhile, the contents of the two marriage agreements are the same. It’s just that several notaries add a list of assets to the postnuptial agreement. A postnuptial agreement applies to third parties after Civil Registry Office registers it to fulfill the element of publicity.

Steps to Obtain Marriage Agreements

There are several steps a couple must go through to create a prenuptial or postnuptial agreement:

Making a list of all owned assets and properties;
Preparing ownership documents and proofs of properties;
Ensuring that all documents are valid such as Id Card, family cards, and birth certificates;
Discussing who is responsible for child support;
Hiring a legal advisor or notary to discuss and draft a marriage agreement with the proper format and under the Marriage Law; and
Record the prenuptial agreement formally at the local Civic Registrar or Office of Religious Affairs.

When Do You Need Marriage Agreements?

When someone marries a foreigner, planning to open a business before of after the marriage, or own a lot of assets or property, they need marriage agreement.

The agreement is also necessary for mixed marriage couples in Indonesia to protect their assets, especially for those who do not have a prenuptial agreement. An Indonesian wife is excluded from owning property when married to a foreigner.

Without the postnuptial agreement, mixed marriage couples only can use their family member or relative’s name to buy a property. But all these measures are highly questionable and may risk a much more significant loss.

The agreement also should be made for couples who will or already have a business, either jointly with a third party or run alone because we do not know the future of their business, whether it continues to grow or fail.

By making a marriage agreement, we protect our partners so that when the business we run fails, and there is a debt to be paid, we only use our assets to cover the debt. A marriage agreement makes the household with a partner better. We are also considered ready to face bad things in the future, as it provides protection not only for ourselves but also for our children and the asset we own.

How We Can Help

Seeing the fact today that divorce separations are common in society and disputes regarding division of property and child come as a big issue during the process, a prenuptial and/or postnuptial agreement is critical to prevent the dispute.

Not only in the event of divorce, we advice Indonesian women planning to marry foreigners to make a marriage agreement. Without prenuptial and/or postnuptial agreement, Indonesian women are not allowed to have property. Here we have seen how important prenuptial and/or postnuptial agreement is.

We can help you know your rights and how you can protect your assets. Our experienced consultant and/or legal advisers can assist you in coming up with a prenuptial and/or postnuptial agreement that suits you and your couple. Through our legal assistant, you will get the protection you need through the agreement.

FAQs

Are marriage agreements only for the rich?

Not at all. A marriage agreement is necessary for any couple wishing to regulate, among others, their rights and obligations, assets management, income distribution during the marriage and after the marriage ends, as well as their children’s needs.

Is there any other requirement for the marriage agreement to be valid?

A marriage agreement is valid if it is made with a deed before a notary, registered to the Civil Registry Office, and recorded.

If we already have a marriage agreement and one of the parties wants to sell their property, does the spouse need to consent?

No. It does not require the spouse’s consent because there has been a separation of property between husband and wife with the marriage agreement.

What documents are needed to make a marriage agreement?

To make a marriage agreement, the required documents are: