- The province of Bali has blocked applications for new PT PMA entities in the OSS licensing system across 18 low and medium-low risk lines of business. The list includes code 68111, “real estate: owned or leased”, along with the codes for hotels, guest houses and other accommodation.
- The restriction has been in force since the third week of May 2026, was announced publicly by governor Wayan Koster on 22–23 July 2026 and was agreed with the investment ministry. Applications under the closed codes are rejected automatically.
- Companies already registered are not cancelled: they keep operating under their existing licences, but face tighter inspections and must file LKPM reports.
- The scheme “buy a villa and open a new PT PMA under 68111 for it” no longer assembles in Bali. Two workable routes remain: a direct leasehold (Hak Sewa) registered to the investor, and buying from a developer that already has the structure in place and the property correctly designated.
- A foreigner’s right to lease land under Hak Sewa in their own name is untouched by this measure — it is about company licensing, not about title.
The most popular route for a foreigner into Bali’s rental business has stopped working. Since the third week of May 2026 the province has not been letting applications for new PT PMA companies through the OSS licensing system in 18 lines of business — and that list includes code 68111, “real estate: owned or leased”. It was only announced publicly on 22–23 July, so some buyers found out about the ban after they had already paid a deposit. Here is what exactly was closed, who it really affects, and which entry routes remain legal.
What happened to PT PMA registration in Bali?
Short version: the Bali provincial government has restricted foreign companies’ access to the Online Single Submission (OSS) system — the single state platform through which businesses are registered and permits are issued in Indonesia. Applications for new PT PMA entities (a company with foreign shareholding) under 18 low and medium-low risk codes of the KBLI business classifier are now rejected automatically. The measure was agreed with the investment ministry and, according to officials, has been in force since the third week of May 2026, although governor Wayan Koster only announced it publicly on 22–23 July.
The authorities’ stated motive is protecting local small business. Foreign firms were entering low-risk categories, where a basic NIB registration number and a virtual office are enough, and competing with Indonesian entrepreneurs in sectors that had historically been their territory.
“Investment must align with Bali’s development vision, respect local wisdom and strengthen the people’s economy based on SMEs,” — Bali governor Wayan Koster, 23 July 2026.
For a real estate investor, four codes on the list matter most.
| KBLI code | Business activity | What it closes in practice |
|---|---|---|
| 68111 | Real estate: owned or leased | Owning and renting out a property through your own legal entity — the base code of the rental business |
| 55110 | Hotels (up to 6,000 m²) | Hotel-format management of a villa or a small complex |
| 55120 | “Melati” class guest houses | Budget accommodation format |
| 55900 | Other accommodation | The “fallback” code often used to cover nightly rentals |
The other fourteen codes on the list have no direct bearing on real estate, but they show the logic: cafés (56303), car and motorbike rental (77100 and 77311), management and industrial consulting (70204 and 70209), retail of clothing and food, tailoring, fitness and sports facilities, traditional medicine pharmacies.
No official regulation number has been published for this measure. Both Indonesian and English-language outlets describe it as an administrative block on codes inside OSS, approved by the investment minister, rather than as a published legal act. That detail matters: rules of this kind can be adjusted faster than a law — and in both directions.
Who this affects, and who it does not
The market’s first reaction was panic — “foreigners have been banned from Bali real estate”. That is not the case. Let us separate three different things that keep getting mixed up in the discussion.
| What exactly | Affected? | Comment |
|---|---|---|
| Registering a new PT PMA under code 68111 in Bali | Yes, closed | The application is rejected automatically in OSS |
| An existing PT PMA with this code | No, still operating | Licences remain valid; LKPM reporting is mandatory, inspections stepped up |
| Leasehold (Hak Sewa) held by an individual | No | This is a land title, not an activity licence — KBLI codes are not used here |
A separate word on freehold: a foreigner never had it in the first place. Land ownership in Indonesia is reserved for citizens of the country — that is a direct statutory ban, not a consequence of the July measure. The legal format for a foreigner is a long-term Hak Sewa lease with the right to build, rent out and transfer the rights.
Why the “villa + your own PT PMA” scheme broke
For the past few years the standard scenario looked like this: the investor leases a plot or buys a villa from a developer, opens their own PT PMA under code 68111, registers the operating activity under it and rents the property out nightly. The company delivered three things at once — a legal basis for commercial rental, a route to an investor KITAS, and a clear tax structure.
Now the first step in that chain fails: a new PMA for “real estate” simply cannot be registered in Bali. And since the accompanying accommodation codes are closed as well, swapping 68111 for “hotel” or “other accommodation” will not get you around the ban.
How this looks in practice. An investor paid a deposit on a villa in Canggu in June, planning to open a PMA by handover. In July it turns out the application will not go through: the code has been blocked since May. The property is bought, and there is no operating structure behind it. The options: hand management to a licensed management company, negotiate a structure with the developer, or look for an existing company with active permits — with a full audit of its past.
This is exactly why the question of “PMA or leasehold”, which used to be a matter of convenience and tax, became a matter of availability in July 2026: one of the two options is temporarily closed to new players.
What remains legal: two working routes
Route one — a direct leasehold in the investor’s name. The land is taken on a long-term Hak Sewa lease, and the right is registered by a bilingual notarial deed directly to the individual. Neither an NIB nor a KBLI code is needed for the title itself: this is a civil-law contract, not a licence. What has to be checked here is different — the plot’s zone (nightly rental is not legal everywhere), the certificate’s clean status at the notary, and the lease term together with its extension mechanism. How that works step by step — in our breakdown of the deal and notary in Bali.
Route two — buying from a developer with the structure already in place. When the property is built inside a project where the land designation, the KKPR and PBG permits and the operating model are set up in advance, the buyer does not have to assemble the legal perimeter themselves. Rentals are run by a licensed management company with its own valid permits, and the owner receives income under a contract with it. What exactly to check on a developer — in our six-step checklist and our breakdown of KKPR, PBG and SLF documents.
There is a third option — buying an operating PT PMA with an active code. Formally it works, and the price of such companies has risen noticeably since 23 July. But along with the licence the buyer takes on the entity’s history in full: tax liabilities, old contracts, possible debts and claims. That is a separate transaction with legal and tax due diligence, not “buying a folder of documents”. For an investor with a single villa the costs usually outweigh the benefit.
A buyer’s checklist under the new rules
- Ask about the operating setup before the deposit. Not “does the property have its documents”, but “which structure will the property be rented through and who holds the licence”. The answer “you will open a PMA” stopped working in Bali in July 2026.
- Check the zone. The legality of nightly rental is determined by the plot’s zoning, and no company compensates for that.
- Verify the management company’s permits. The management company must hold its own valid licences, obtained before the block — ask to see the NIB and the codes.
- Budget taxes on the real price. With supervision moving into the Coretax system, data on transactions, owners and payments is cross-checked automatically: understating the contract price surfaces without an inspector’s involvement. How that works — in our breakdown of property taxes in Bali.
- Do not confuse the visa with the ownership structure. The investor KITAS was often obtained through one’s own PMA; with no company, the residence-permit route has to be planned separately — see KITAS and visas for a villa owner.
What this means for the market next
The measure hits the entry of small foreign capital into operating niches — and at the same time raises the value of properties whose legal and operating perimeter has been built by the developer. The buyer who used to assemble the construction himself now pays for it to be assembled before him. Two parallel processes push in the same direction: the digital revaluation of land under ATR/BPN regulation No. 3/2026, where a complete electronic document pack adds 20–40% to a property’s valuation, and tighter immigration control — in the first half of 2026, 342 foreigners were deported from the island, including for working outside their status.
The overall direction reads unambiguously: the island is not closing to foreign money, but it is no longer accepting it in its “light” form — through a company opened in a hurry at a virtual address. The winner is whoever has the documents in order before the deal, not after it.
In DOMA projects the right is registered directly to the investor through a leasehold with notary support, the permit pack is assembled by the developer, and rentals are run by a management company with its own licences — so the buyer does not need to register a legal entity for the villa to operate legally. You can look at the economics of a specific unit in the configurator, and estimate the yield in the ROI calculator.
FAQ
Does this mean a foreigner can no longer buy a villa in Bali?
No. The restriction concerns the registration of new foreign companies in 18 sectors, not a foreigner’s right to take land on a long-term lease. Leasehold (Hak Sewa) is executed by a bilingual notarial deed in the name of an individual and requires neither an NIB nor KBLI code 68111. What has changed is something else: you can no longer quickly open your own “real estate” PT PMA to rent the villa out.
What happens to my existing PT PMA with code 68111?
It keeps operating. The measure closes new applications, not existing licences: companies that obtained an NIB and permits before the block retain the right to operate. The obligation to file LKPM reports stays, and inspections of such companies have been stepped up — discrepancies in reporting, virtual addresses and activity that is not actually carried out have become far more visible.
Can I register a company in another province and operate in Bali?
Formally, the KBLI code is closed specifically in the Bali segment of the OSS system. But activity is tied to the actual place of business and the property’s address, so “a Jakarta company for a villa in Ubud” is a construction that falls apart at the first inspection. Consultants on the island rate that workaround as high-risk.
Is it worth buying a ready-made PT PMA with an active 68111 code?
Such companies have jumped in price, but along with the licence the buyer takes on the entity’s entire history: tax liabilities, past contracts, possible debts and claims. It is a transaction that needs its own legal and tax due diligence. For someone buying a single villa, the costs and risks usually outweigh the benefit.
How do I legally run the villa on nightly rental now?
Through a licensed management company that holds its own valid management and accommodation permits. The owner earns as a lessor under a contract with the management company, while the operating licence stays with the operator. Check the plot’s zone separately: nightly rental is not legal everywhere.