- Since February 2026, converting a rice field into a villa on Bali is a criminal offence, not an administrative fine. The provincial law Perda No. 4/2026 (signed by governor Koster on 24 February 2026) protects LP2B farmland and the subak system; penalties rest on the national laws UU 41/2009 (up to 5 years in prison and a fine up to 1 billion rupiah for illegal farmland conversion) and UU 26/2007 (up to 3 years and 500 million rupiah for a zoning breach).
- For a buyer this creates two risks: conversion permits on rice fields are frozen, and nominee structures (land held by a local «nominee») are squarely in the law's sights — up to demolition and licence revocation. The only safe route is a plot in a permitted (non-green/non-LP2B) zone with the full KKPR and PBG package. Enforcement focuses on Tabanan and Gianyar (Ubud); a moratorium on new construction covers 6 regencies, but projects with a PBG already in hand continue.
The rice terrace framed in a villa window is Bali marketing's signature image. Since February 2026 it has also become its single biggest legal risk: converting a rice field into a building plot on Bali has stopped being an administrative offence with a fine and has become a criminal one. The provincial law Perda No. 4/2026 protects farmland and takes direct aim at nominee structures, while remaining conversion permits on rice fields are frozen. Here is what is now punishable, what it means for a villa buyer, and how to check a plot before you pay a deposit.
What changed: a rice field turned into a villa is now a criminal offence
In short: on 24 February 2026 Bali governor Wayan Koster signed the provincial law Perda No. 4/2026 protecting sustainable farmland (LP2B), and from that moment converting a rice field for commercial development — a villa, for instance — is classed as a criminal act rather than, as before, an administrative infringement carrying a fine. The law draws its penalties from national statutes: the farmland-protection law UU 41/2009 and the spatial-planning law UU 26/2007. In parallel, all remaining permits to convert rice fields are frozen until Bali's LP2B conservation targets are met (Bali provincial government, February 2026).
For an investor this is not a change of tone but a change in the nature of the risk. An administrative fine can be built into a budget; a criminal charge, a demolition order and the revocation of licences cannot. Below is what exactly falls under the law, the numbers behind the penalties, and how to tell a safe plot from a "field with a villa on it".
What is now banned, and why
The law protects LP2B (Lahan Pertanian Pangan Berkelanjutan) — sustainable farmland for food production that the authorities are obliged to preserve. Inside that perimeter sit the lands of subak, the Balinese communal water-sharing system on the rice terraces, inscribed on the UNESCO World Heritage list. The motive is blunt: over a decade Bali's benchmark rice-field area shrank from roughly 70,996 hectares in 2019 to about 64,474 hectares by February 2026, losing an average of some 1,254 hectares a year (Bali provincial government, February 2026). The authorities set a target of locking about 87% of LP2B land under protection — and closed conversion until that target is reached.
What the ban actually catches is the change of use of a farmland plot for development: you can no longer obtain a permit to build a villa on a field in a green/LP2B zone, and deals that disguise such a conversion carry criminal risk. Enforcement is being concentrated on two regencies — Tabanan and Gianyar — as the core pillars of subak. One detail matters for buyers: Gianyar includes Ubud.
A "field with a villa on it" used to be cheaper than a plot in a permitted zone, and that gap looked like a saving. From 2026 the same gap is the price of criminal exposure, a frozen permit and a possible demolition.
What a breach costs: prison terms and fines
Perda No. 4/2026 does not operate in a vacuum — its sanctions rest on existing national laws. Below are the benchmark penalties the regulator points to (as of February 2026).
| Statute | For what | Criminal liability |
|---|---|---|
| UU 41/2009 Farmland protection (LP2B) | Illegal conversion of protected farmland for development | Up to 5 years' imprisonment + fine up to 1 billion rupiah |
| UU 26/2007 Spatial planning | Building on or using a plot against its zoning | Up to 3 years' imprisonment + fine up to 500 million rupiah |
| Administrative sanctions Perda No. 4/2026 | Measures attached to the breach | Demolition of the structure, revocation of business licences |
A 1 billion rupiah fine is around US$60,000 at the July 2026 rate — but for an investor the far costlier outcome is the demolition of a completed building and the loss of the capital sunk into it: LP2B land cannot be legalised retroactively while the freeze holds. That is precisely why "saving on the plot" in a green zone is a false economy. For a buyer from Australia, the United States or the UK, the mental reference point is familiar: it is the equivalent of buying a beachfront home on protected agricultural or conservation land back home and expecting to regularise it later — except here the exposure is now criminal, not a planning dispute.
The blow to nominees: why "land in a local's name" just got more dangerous
A separate — and arguably the most important — layer of the law for a foreign buyer is its targeted strike against nominee structures (where land is registered to a local resident "by power of attorney" while a foreigner in fact controls it). The law is aimed squarely at "borrowed names" and the intermediaries who arrange such deals. Governor Koster framed farmland as "the foundation of Bali's food sovereignty and ecological balance" — and the authorities regard nominee constructions over rice fields as the most destructive of all.
Legally, nominee ownership was already empty for a foreigner: Indonesian law does not recognise them as the owner, and the money in such a deal is weakly protected — we covered this in detail in our piece on whose name Bali land is registered in. Now, on top of that civil-law nullity, come criminal exposure and a real prospect of demolition and licence revocation if farmland sits under the nominee. This is one of the systemic mistakes investors make on Bali that in 2026 has become costlier than ever.
How it plays out in practice. An investor was looking at a plot "with a view over the rice terraces" near Ubud; the seller offered to register the land to a local partner and "legalise everything later". A zoning check showed the plot sat inside the LP2B (subak) perimeter — under the conversion freeze. There was simply no legal route to a villa on it; after Law No. 4/2026, "legalising later" would have meant criminal exposure and a possible demolition. The deal fell through — and that is a better outcome than building on land that cannot be converted for development.
Does this mean you can no longer build on Bali at all?
No. The ban concerns LP2B farmland and the conversion of rice fields — not the whole island. In parallel Bali has a moratorium on new tourism construction, but that too is targeted. As of 2026 it is in force across six regencies and excludes three that matter most to investors.
| Under the moratorium (new tourism building restricted) | Excluded from the moratorium |
|---|---|
| Tabanan, Jembrana, Buleleng, Bangli, Karangasem, Klungkung | Badung, Gianyar (Ubud), Denpasar |
The key caveat: projects that already hold a PBG permit (the building consent that replaced IMB from 2021) keep building — the moratorium is not retroactive for legally launched projects. In other words, the restrictions target new land conversion and unregulated construction, not a developer's legal project in a permitted zone with the full document package. That Gianyar (Ubud) and Badung are excluded from the moratorium follows directly from their official status as tourism, not agricultural priority, zones.
How to check a plot before you pay a deposit
The direct answer: before any deposit, confirm that the plot is not in a green/LP2B zone and carries a use designation permitted for development and tourism, and that the project holds KKPR and PBG. Here is the practical order — four steps.
1. The plot's zone. Check which zone the plot falls under in the spatial plan (RTRW/RDTR): development and tourist rental are permitted in "yellow/pink" zones, but not in the "green"/LP2B one. How to read the colours and zone categories is set out in a separate guide to land zones on Bali. If the plot is inside a subak or LP2B perimeter, there is no legal route to a villa — and the conversation ends there.
2. Title and owner. The land certificate (SHM for a citizen, or HGB via a PT PMA) must be checked at the National Land Agency (BPN): authenticity, a matching owner, no encumbrances. For a foreigner, only leasehold (Hak Sewa) or a building on HGB through their own company is legal — and even that works only on a plot in a permitted zone.
3. Construction permits. A legal project must hold KKPR (confirmation that the plot's use is compliant) and PBG (the building permit) before construction begins, and an SLF (certificate of fitness) at handover. The full breakdown of the package is in our piece on the developer's documents: KKPR, PBG and SLF. A valid PBG in hand is exactly what lifts a project out from under the moratorium.
4. Who the seller is. The land must not sit under a nominee; the party selling and holding the HGB should be a legitimate PT PMA with a valid NIB and the correct KBLI. The full checklist is in our article on how to vet a developer on Bali.
What this means for an investor in 2026
Law No. 4/2026 does not close Bali to investment — it closes one specific loophole on which the "cheap" entry route was built for years: buying farmland for a villa, often through a nominee, on the bet of "legalising it later". From 2026 that route leads not to a fine but to a criminal charge, a frozen permit and demolition risk. The winning strategy is the exact opposite — a plot in a permitted zone, the full KKPR and PBG package, and a transparent ownership structure through your own PT PMA or leasehold.
That is why a developer's legal build in a permitted zone is now not merely "the calmer option" but the only safe path. DOMA's flagship projects are concentrated in Ubud (Gianyar) — a regency excluded from the moratorium — on plots with confirmed use and permits in hand. You can assemble a villa configuration to suit your goal and budget, with a transparent document package, in the DOMA configurator — and this is exactly the case where "boring" legality turns out to be the main asset.
FAQ
Can you build a villa on a rice field on Bali in 2026?
No, if the plot is classed as protected LP2B farmland (a green zone). The provincial law Perda No. 4/2026 froze conversion permits on such fields until the LP2B protection targets are met, and the change of land use for development has itself become a criminal act. You can only build on a plot in a zone permitted for development and tourism (yellow/pink), with the KKPR and PBG permits obtained.
What is the penalty for converting a rice field into a villa?
Liability is now criminal. Under the national farmland-protection law UU 41/2009 — up to 5 years' imprisonment and a fine up to 1 billion rupiah for illegal LP2B conversion; under the spatial-planning law UU 26/2007 — up to 3 years and up to 500 million rupiah for a zoning breach. Administrative sanctions also apply: demolition of the structure and revocation of business licences. What used to be an administrative fine is now a criminal offence.
What are LP2B and subak in plain terms?
LP2B (Lahan Pertanian Pangan Berkelanjutan) is sustainable farmland for food production that the authorities are obliged to preserve and on which building is prohibited. Subak is the Balinese communal water-sharing system on the rice terraces, inscribed on the UNESCO World Heritage list. It is precisely the subak lands in Tabanan and Gianyar that Law No. 4/2026 protects first; you cannot legally buy a «field for a villa» in such a zone.
What does Law No. 4/2026 mean for a buyer who registered the land to a local?
The nominee structure (land recorded to an Indonesian «by power of attorney») is now squarely in the crosshairs: the law strikes at the intermediaries who arrange such deals, and a breach carries demolition of the structure and revocation of licences. Nominee ownership was already void in law (a foreigner is not recognised as the owner), and now criminal and confiscation risk is added for an asset on farmland. Only leasehold, or a building on HGB through your own PT PMA — on a plot in a permitted zone — are safe.
Does this mean you can no longer build on Bali at all?
No. The ban concerns LP2B farmland and the conversion of rice fields, not the whole island. A parallel moratorium on new tourism construction is in force in 6 regencies (Tabanan, Jembrana, Buleleng, Bangli, Karangasem, Klungkung), while Badung, Gianyar (Ubud) and Denpasar are excluded from it. Projects that already hold a PBG permit keep building. A developer's legal build in a permitted zone with the full document package does not fall under the restrictions.