Rental Business or Villa Owner in Bali? These Important Regulation Changes May Affect You

If you're listing your Bali villa on Airbnb or Booking.com, you may have already received a notification that surprised you. But what's behind it and what do you need to do? The rules around foreign-owned accommodation businesses in Bali have shifted, so let us update you on the changes, and what you need to do before the deadline on the 31st of March 2026.

If you own or manage a Bali villa listed on Airbnb or Booking.com, recent regulatory changes may significantly impact how your business operates.

In early 2026, the Bali Governor triggered a government review of how foreign-owned companies operate on the island. The result is a set of licensing clarifications that are now being enforced on online travel agencies. Both Airbnb and Booking.com are requiring hosts to register their NIB (Nomor Induk Berusaha - Business Identification Number) before the 31st of March 2026, or instead face removal from their platforms.

If you own a villa, manage short-term rentals or are in the process of setting up a PT PMA (Penanaman Modal Asing - foreign-owned company) to do so, these changes will affect you. 

What Happened?

On the 28th of January 2026, the Bali Governor sent an official letter to the BKPM (Badan Koordinasi Penanaman Modal - Indonesia's Ministry of Investment) with two areas of focus - tighter monitoring of foreign-owned businesses and action against shell companies being created just for the purpose of securing a visa. 

This led to a meeting on the 12th of February 2026 at the Bali Governor's Office, attended by the Ministry of Investment, the Ministry of Tourism, the Ministry of Public Housing and the Bali Provincial Government. The results of this meeting involve changes that will impact those running rental businesses. 

Short-Term  Rentals

The central government has made its position clear: short-term villa rentals for tourists are intended for Indonesian individuals and locally-owned companies only.

For foreign-owned companies, the Ministry of Tourism has confirmed there is now only one available classification for short-term accommodation, which is KBLI 55110 – Star Hotel. This has been confirmed with the Bali Provincial Tourism Office and is already being enforced by Airbnb and Booking.com, which now require PT PMA operators to submit a NIB showing this classification to remain listed on the platform. 

The regulatory changes were introduced after a formal review by the Bali Governor to enhance supervision of foreign-owned businesses and address the misuse of company structures.

The OSS system defines KBLI 55110 as businesses that provide accommodation meeting star-hotel standards, offering lodging and supporting services to the public using part or all of a building. Properties under 6 are (roughly 600 sqm) carry a Lower–Medium risk classification, whereas properties above that threshold fall into Upper–Medium to High risk and may need visible business signage, an administrative office space and safety equipment on site.

Without the correct KBLI on your NIB, your listing could be removed from Airbnb and Booking.com after the 31st of March 2026. The Ministry of Tourism has confirmed that this deadline is firm.

For PT PMA companies conducting short-term rentals, KBLI 55110 (Star Hotel classification) is currently the only recognized accommodation category.

Long-Term Rentals and Property Management

If your property operates on a long-term rental basis (annual rentals) rather than through OTAs, the recommended classification is KBLI 55900 – Other Accommodation Services. This code is intended strictly for long-term lease arrangements. However, interestingly, Airbnb has listed 55900 as one of the options to select when uploading NIB. This could be because long stay bookings are also possible on Airbnb, Booking.com in meantime hasn’t yet listed KBLI 55900 as a possible choice.

This is a screenshot from the Airbnb system requiring submission of an NIB with the appropriate KBLIs. For foreign-owned companies, the only available KBLIs are 55110 (Star Hotel) and 55900 (Provision of Accommodation). Other accommodation-related KBLIs can only be obtained under an NIB issued in the name of an Indonesian individual or a locally owned company.

Separately, KBLI 68111 - Owned or Rented Real Estate is now discouraged for PT PMA use in Bali. This code, which some foreign operators have relied on in the past, is now limited to large-scale residential developments like apartment complexes and is no longer an option within Bali’s accommodation sector. KBLI 68111, however, remains available for PT PMA ownership in other regions of Indonesia.

Nine KBLI Codes Now Discouraged for New PT PMAs

Following the Governor’s letter, nine KBLI codes are currently being discouraged for new foreign company registrations specifically within the Bali region:

• 68111 (Real Estate)

• 70209 (Other Management Consulting)

• 77311 (Vehicle Rental without option rights) 

• 77100 (Car/Bus/Truck Rental)

• 79121 (Travel Agency Activities)

• 47711 (Clothing Retail)

• 47511 (Textile Retail)

• 47249 (Food Retail)

• 47991 (Food Retail from agricultural products).

This has not yet been formally confirmed by BKPM, so these are strong recommendations rather than actual restrictions as of right now. PT PMAs that are already operating under these codes and have them activated on their NIB should not be affected, as this guidance applies to new company registrations.

If you are planning to register a new company, it’s a good idea to seek advice from trusted sources before selecting your KBLI. If you’d like to know more about these regulations or setting up a company in Bali, don’t hesitate to reach out to us here at Bali Solve. We can help you to make sure everything is done legally and properly from the start so that you have complete peace of mind, and give you an accurate picture of the latest regulations and best practices for success in Bali. 

Virtual Offices

Virtual office addresses remain legal for PT PMA use but the rules around how they can be used have tightened.

A virtual office address can only be listed as your registered correspondence address on Page 1 of the NIB (the Alamat Kantor field). It cannot be used as your operational business address. Your actual business or asset location must now be entered on Page 2 of the NIB next to your KBLI (the Alamat Usaha field). The OSS system uses this address to verify zoning, meaning it checks whether your chosen business activity is actually permitted at that specific location.

Not every zone in Bali permits a Star Hotel classification. Before registering, check that your property's zoning is compatible with your intended KBLI. Government officials may also conduct unannounced visits to verify that your registered operational address matches your actual place of business.

A virtual office address is still allowed, but only as a temporary or correspondence address (Page 1 of the NIB). The actual operational or project address must now be declared on Page 2 of the NIB so the OSS system can verify the property’s zoning.

What to Do If Your Property Is Located in the Incorrect Zone?

If your property is located in a zoning category that does not support your intended activity, the situation should always be assessed on a case-by-case basis. Zoning compliance has become increasingly important, particularly as the OSS system now links KBLI approval directly with the project address and land zoning.

For example, properties located in yellow (residential) zones may face restrictions when applying for accommodation-related KBLIs under a foreign-owned company. In such cases, one commonly explored approach is partnering with an Indonesian landowner or structuring operations through a locally owned entity that is better aligned with zoning limitations.

However, this is not a one-size-fits-all solution. The appropriate structure depends on several factors, including:

• The exact zoning classification and local spatial plan (RDTR)

• Whether the property is used for commercial activity or private residence

• The land title status and ongoing permit processes (e.g., HGB conversion)

• Risk tolerance and long-term investment strategy

• Taxation, profit distribution, Immigration compliance and operational control considerations

Because of these variables, both the legal structure and financial flow arrangements should be carefully reviewed before any restructuring is implemented.

Looking Ahead 

Foreign investment remains welcome in Bali, but proper structure, licensing alignment, and zoning compliance are now strictly enforced.

These changes signal a clear shift toward stricter oversight of foreign-owned businesses in Bali, particularly in accommodation sector. The good news is that foreign investment remains welcome, but the expectation is that it is structured correctly from day one.

For anyone operating in this space, the priorities right now are straightforward: 

• Ensure your PT PMA’s NIB and registered KBLIs are fully aligned with your actual property activities.

• Make sure your operational (rented property address) is properly entered on Page 2 of your NIB next to the appropriate KBLI.

• Verify your property's zoning, and ensure your NIB is registered before the 31 March 2026 deadline. 

When it comes to legal compliance, it's always better to be proactive than reactive. If you’re not sure whether your current setup is compliant, contact our office in Pererenan to schedule a consultation or reach out via WhatsApp. Our team can review your NIB, assess your KBLI and guide you through any changes needed.


Written by Bali Solve Team 
01 March 2026