In Indonesia, various statutes form the secured transaction framework. The Fiduciary Security Act 1999 and the Civil Code govern most secured transactions. However, if the subject of a security interest is stock issued by a company, the transaction is governed by the Limited Liability Company Act 1995. Under these laws, both possessory and non-possessory pledges can be granted over movable assets. The possessory pledge is called a “gadai”, and the non-possessory pledge is called “fidusia”. Under the fidusia, there is a transfer of title of the movable asset from debtor to creditor, but the asset itself remains in possession of the debtor. The fiducia is a versatile mechanism, as it can be used for all movables, tangibles and intangibles, but it can also be used to create security interests over immovable property. Some of the immovable property that can be subject to fiducia includes buildings that are not subject to mortgages, small vessels or vehicles.
Last Checked November 2020
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