This year, the Ministry of Agrarian Affairs and Spatial Planning/ National Land Agency (Kementerian Agraria dan Tata Ruang/ Badan Pertanahan Nasional or “BPN”) issued BPN Regulation No. 3 of 2026 on Land Valuation (“BPN Reg. 3/2026”). This new BPN Reg. 3/2026 becomes effective 3 months after its promulgation, or on 25 May 2026. This new regulation was issued in response to the growing demand for land valuation information, particularly for businesses such as land acquisitions, project financing, land transactions, and property investment.
This article summarizes several key provisions under BPN Reg. 3/2026 that are relevant to businesses planning to acquire land or involved in land transactions in Indonesia.
Land Valuation Maps and Involvement of AI
BPN Reg. 3/2026 recognizes two types of land value maps: Land Value Zone (Zona Nilai Tanah or “ZNT”) and Land Plot Value (Nilai Bidang Tanah or “NBT”), which is the land value of an individual plot of land. Meanwhile, ZNT is a zone comprising land parcels with relatively similar values (Article 1 of BPN 3/2026). Both ZNT and NBT Maps can be accessed electronically or requested from the relevant local land offices.
In processing and determining NBT, BPN may utilize AI and Machine Learning, including the random forest method, to predict land values (Article 29 of BPN Reg. 3/2026). In this context, the AI random forest method for land valuation is an automated approach that predicts land prices by creating multiple “decision trees” and averaging their results to estimate land value based on various variables.
Renewal of Official Land Value Maps and Utilization of Land Valuation Maps
Article 32 of BPN Reg. 3/2026 also states that both ZNT and NBT maps may be updated or renewed, at least, once a year. The updates may also be carried out in response to complaints about land value information, BPN’s operational needs, or requests from other government institutions under cooperation agreements.
BPN Reg. 3/2026 also expands the utilization of land value information beyond land valuation activities. Article 53 of BPN Reg. 3/2026 provides that official land value maps may be used, among others:
- as the basis for determining non-tax state revenues relating to land and spatial planning services;
- preparing spatial planning documents;
- estimating land acquisition costs during project planning;
- assessing changes in land value arising from land consolidation; and
- as secondary data for other purposes.
In light of the above new provisions, businesses, including developers and industrial estate operators that directly utilize or acquire lands as part of the performance of their business activities, need to assess whether the land value map has been updated or renewed during the land due diligence and negotiation process when acquiring the new land plot. This assessment is important because land valuation may affect the acquisition costs, as well as the asset valuation of the land they will acquire.
Possibility to Challenge Official Land Value Information
Under BPN Reg. 3/2026, businesses and individuals may challenge the official land value information. Under Article 56 of BPN Reg. 3/2026, any party that objects the official land value may submit a complaint to BPN. Eligible applicants include individuals, corporate entities, government institutions, foundations, organizations, and unincorporated business entities or institutions (Article 57 of BPN Reg. 3/2026).
To support the objection over the land value information, the applicants are required to submit supporting documents, including proof of ownership or control of the land, land value information obtained from BPN, and evidence of market transactions or other documents that support the claimed land value (Article 58 of BPN 3/2026).
Although the regulation does not guarantee that the complaint will result in any revision of the land value, it gives businesses the right to raise concerns when they believe the official land values do not accurately reflect the prevailing market conditions. It would be relevant in major land acquisitions or financing transactions where differences in land value could affect the financing valuation or the project’s costs.
Since there is no guarantee that BPN would revise or update the land valuation based on any challenges raised by businesses or individuals, the official land value may still not reflect the prevailing market conditions.
Disclaimer: The information herein is of general nature and should not be treated as legal advice, nor shall it be relied upon by any party for any circumstance. Specific legal advice should be sought by interested parties to address their circumstances.
