Experts Affirm State Land Management Agency's Legal Validity
The existence of the Land Bank Agency has received further affirmation from the perspective of constitutional and land administration law. Gadjah Mada University Faculty of Law lecturer Oce Madril stated that the Land Bank Agency possesses the character and criteria of a public legal entity because it was established based on a legal mandate, holds public authority, and carries out land management functions for the broader public interest.
This statement was made in the context of a continued judicial review hearing of Law Number 6 of 2023 at the Constitutional Court. In his testimony, Oce explained that the establishment of the Land Bank Agency through Government Regulation Number 64 of 2021 is an implementation of Article 125 of the Job Creation Law.
According to Oce, conceptually the Land Bank Agency meets the elements of a public legal entity when viewed from its basis of formation, organisational structure, authority, sources of capital and wealth, and accountability mechanisms. With this construction, the Land Bank Agency cannot be seen merely as an asset management entity, but rather as a state instrument carrying out the mandate of land control and management.
“The Land Bank Agency performs a beheersdaad function as part of the State’s Right to Control, managing land for various public interest purposes to create a just economy,” Oce said, as quoted from the Constitutional Court’s official website.
Oce also emphasised that the Land Bank Agency is a non-profit institution. Although it may receive income from service tariffs for land utilisation in cooperation with third parties, this income is not intended as commercial profit. The funds obtained are reused for land management and maintaining the operational sustainability of the agency.
“The income obtained is also used to maintain operational sustainability so that the Land Bank Agency does not continuously burden the state budget,” he stated.
This explanation is significant because the position of the Land Bank Agency often draws attention in land law discourse, particularly concerning the relationship between state authority, land asset management, and the fulfilment of public interest. Within the normative framework, the agency is positioned as an implementer of state functions to ensure land can be managed in an orderly, directed manner and provide broader socio-economic benefits.
In a separate plenary session, former Minister of Agrarian Affairs and Spatial Planning/Head of the National Land Agency for the 2016-2022 period, Sofyan Djalil, also explained that the Land Bank Agency was formed to bridge the gap between land policy and its implementation on the ground.
According to Sofyan, the Land Bank Agency is sui generis or hybrid in nature. The agency exercises operational authority over Hak Pengelolaan (Management Rights), which are part of the State’s Right to Control. With this model, the state has an institutional instrument to manage state land more effectively, including supporting agrarian reform and the broader public interest.
“The Land Bank does not control land for itself. The Land Bank controls land to be used for greater interests, including how the land can be distributed to the people so that the community gains access to land,” Sofyan said.
Sofyan’s statement aligns with the implementation of the Land Bank Agency’s duties and functions as an extension of the government in managing and utilising state land. From a public policy perspective, the agency’s existence is projected to strengthen land governance, provide land for development, and open fairer access to land.
As of the first quarter of 2026, the Land Bank Agency’s land inventory was recorded at 34,806 hectares. Of this total, 11,823 hectares, or 33.9 percent, have been allocated for agrarian reform under the agency’s Hak Pengelolaan. Additionally, 1,184 hectares are allocated for public and government interests, 1,947 hectares for the utilisation of Hak Pengelolaan, and 19,852 hectares are held as land reserves.
This data shows that the issue of the Land Bank Agency is not only related to the legal status of the institution but also concerns the concrete impact on land distribution and utilisation. In the context of agrarian reform, land allocation becomes one of the important indicators to assess the extent to which the agency’s public mandate is being carried out.
Thus, the testimonies of experts and former government officials in the Constitutional Court hearing affirm that the Land Bank Agency is placed within a public legal framework. Its existence is not directed towards the institution’s commercial interests, but rather as a state instrument to manage land equitably, support the public interest, and expand community access to land.