Due diligence checklist: what each document can and cannot prove

Most due diligence failures are not missing documents. They are documents that were obtained, then asked to prove something they were never capable of proving.

The purpose of this list is not to turn you into a lawyer. It is to let you tell the difference between an adviser who is running proper checks and one who is confirming what the agent already told you.

Each item below says what the document is, and — more usefully — what it is capable of proving. Most due diligence failures are not missing documents. They are documents that were obtained and then asked to prove something they cannot prove.

A. The land itself

What the land office and the PPAT must check, and when a deed must be refused.

1. The certificate (sertipikat)

Proves: which right exists, over which parcel, in whose name, and what is registered against it.
Does not prove: permitted use, building legality, boundaries on the ground, or that the person holding the paper is entitled to sell.

Take the type of right seriously rather than as a label. Hak milik, HGB, hak pakai and strata title are different rights with different terms and different rules about who may hold them, and the difference decides what you can do.

2. Verification against the land office register

Proves: that the certificate you were shown corresponds to what the State actually holds.
Does not prove: anything about use or permits.

This is the step that cannot be skipped and cannot be done by you. A certificate is a document; the register is the record. Checking one against the other is the core of land due diligence everywhere and it is the thing you are paying an Indonesian lawyer for.

3. Encumbrances

Proves: whether a mortgage (hak tanggungan), caveat or registered dispute sits over the land.
Does not prove: the absence of unregistered claims, which is why item 6 exists.

4. Boundaries and the survey plan

Proves: the registered extent of the parcel.
Does not prove: that the fences, walls and driveways on site follow it.

Walk the boundary against the plan. This is free and it finds things.

5. Access

Proves: nothing on its own — this is a question, not a document.
Is the road public, or does it cross a neighbor’s land? If the latter, on what right, and does that right survive a sale? A landlocked plot with a friendly neighbor is a different asset from one with a registered right of way.

B. The people

6. Seller identity, and everyone who has to consent

Proves: that the person signing is the person on the certificate.
Does not prove: that nobody else has to sign as well.

The second half is the one that bites. A married seller may need a spouse’s consent. Inherited land, common in Bali, may be held by several heirs who all have to agree. Family land arrangements can involve people who are not on the certificate and whose consent still matters. Ask directly: who else has to sign, and have they?

7. Authority to sign

Authority to make the transfer deed itself is a separate question with its own article — PPAT authority and the eight acts.

Proves: that whoever signs is entitled to.
Powers of attorney are ordinary here. They are also the principal instrument of nominee arrangements, so read the scope of any power of attorney rather than treating it as administrative.

C. What you may lawfully do with it

8. Zoning and the spatial plan

Proves: the designated use of the land.
Does not prove: that anything currently standing on it was permitted.

This is a separate system from the register and a separate enquiry. Agricultural and green-belt designations are not cured by the presence of a building. Ask for the designation in writing, not as a reassurance.

9. Building permit

Proves: that the structure was approved, for a stated use.
Does not prove: that what was built matches what was approved.

Compare the permitted footprint and use against what is actually there. An existing villa without a permit is a liability that transfers with the land.

10. Land and building tax history

Proves: that the annual tax has been assessed and paid, and the assessed value.
Arrears are ordinarily the seller’s problem right up until they become yours.

D. The structure-specific set

If it is a lease

• The lease deed itself, in Indonesian, with the commencement date and the term.
• Whether this is an assignment or a sub-lease. Ask explicitly; they are different assets.
• Whether the lease permits assignment, and whether the landowner has consented in the form the lease requires.
• The full chain, if it has changed hands before.
• The extension clause, read for whether anyone is obliged to do anything.
• What happens if the landowner sells the land during the term.

If it is hak pakai

• Your own eligibility: PP 18/2021 article 69(1) requires a valid immigration document.
• Whether the conversion under Permen ATR/BPN 18/2021 article 187(3) has been modeled, priced and timetabled — and who pays for it.
• The article 186(1)(a) limits: one parcel per person or family, up to 2,000 m², luxury category.
• The term granted and the dates the extension and renewal applications will fall due.

If it is a PT PMA

• Incorporation documents, licensing and the KBLI line the company is licensed for.
• Whether the investment position satisfies Perka BKPM 4/2021 article 12 — and which limb of article 12(3)(e) your plan falls under, because one of them measures the threshold including land and buildings.
• Filing and tax compliance history, if you are buying an existing company rather than forming one.
• Whether you are buying shares or an asset, and what each does to the land right.

How to use this

Send the list to whoever is advising you and ask which items they will cover, which they will not, and what they will give you in writing at the end. That question alone separates a proper engagement from a reassurance.

Then run it before the deposit, not after. Every item here is cheap while you can still walk away.

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