In 2026, Bali restricted new PT PMA licensing through the Online Single Submission system for 18 low and medium-low risk business activities. The provincial government said the measure was designed to protect local micro, small, and medium enterprises from unfair competition and address suspected misuse of risk-based licensing.
For hotel investors, the important detail is scope. The official Bali Provincial Government announcement includes starred hotels with building areas below 6,000 square metres among the affected activities. It does not establish a universal 101-room or 100-employee threshold, and it does not mean every foreign-owned hotel project is automatically approved when it exceeds a particular size.
According to the Bali Provincial Government’s announcement dated 23 July 2026, the policy followed an evaluation by the provincial investment office and relevant technical agencies. The evaluation identified suspected misuse of Indonesia’s risk-based business licensing system by some foreign-owned companies.
The government focused on low and medium-low risk activities because these categories can have lighter licensing requirements. For low-risk activities, a Business Identification Number, known as an NIB, can be issued automatically through OSS. The province argued that this structure allowed some foreign investors to enter business areas commonly served by local enterprises without substantial licensing checks or significant capital commitments.
Virtual offices also received specific attention. The province described their use as a regulatory gap that could weaken oversight of whether a business had a genuine operational presence. The official rationale was therefore broader than hospitality: it combined business-substance concerns, licensing oversight, and protection for local enterprises.
The provincial announcement states that the restriction took effect across Bali in the third week of May 2026. It was introduced after the Bali Provincial Government received approval from Indonesia’s Ministry of Investment and Downstream Industry, which also heads the Investment Coordinating Board, or BKPM.
The announcement was released publicly in July 2026. Investors should distinguish the public announcement date from the stated effective period. The official source does not use 13 May as the effective date, so investors should not rely on that exact day without further documentation from OSS or the relevant authority.
The official announcement lists 18 activities in low and medium-low risk categories for which PMA access to new business licensing through OSS was closed in Bali until further policy changes.
· Starred hotels with a building area below 6,000 square metres
· Non-star hotels, described in the announcement as hotel melati
· Owned or leased real estate activities
· Management consultancy activities
· Industrial management consultancy
· Rental of cars, buses, trucks, and similar vehicles
· Motorcycle rental
· Retail sale of clothing
· Retail sale of textiles
· Retail sale of food
· Mobile retail sale of agricultural products
· Other accommodation activities
· Drinking establishments or cafés
· Traditional medicine shops or stalls
· Tailoring and made-to-order clothing
· Stadium facilities
· Fitness centre facilities
· Sports event promotion
This list should be read as a summary of the provincial announcement, not as a substitute for an OSS assessment. The exact KBLI classification, risk level, location, business scale, and licensing pathway still need to be checked for each proposed activity.
The policy does not support the claim that Bali closed all hotel investment to foreign ownership. It targets specified activities, including starred hotels below the stated 6,000-square-metre building-area threshold and non-star hotels.
However, the inverse should not be treated as an automatic approval rule. A hotel above 6,000 square metres is not necessarily compliant simply because it exceeds the threshold mentioned in the provincial announcement. Foreign investors must still confirm the applicable KBLI, business risk classification, foreign ownership eligibility, zoning, land rights, environmental obligations, building approvals, operational standards, and current OSS response.
| Issue | Status | Practical meaning |
| 18 affected activities | Officially confirmed | The Bali Provincial Government published the activity list. |
| Effective period | Officially confirmed | The restriction applies across Bali from the third week of May 2026. |
| Hotel threshold in the announcement | Officially confirmed | The wording refers to starred hotels below 6,000 m² of building area. |
| 101 rooms or 100 employees | Not confirmed by this official source | Do not present either figure as a universal government threshold. |
| Every low-risk KBLI is blocked | Not established by this official source | Check the current OSS result and relevant authority guidance. |
| Existing licences | Partly addressed | Existing licence holders must continue submitting LKPM reports; other changes may need case-specific review. |
| Automatic approval above 6,000 m² | Not established | Size alone does not replace project-specific licensing due diligence. |
The official announcement says companies that already have licences must continue submitting Investment Activity Reports, known as LKPM, in accordance with applicable requirements.
The announcement does not fully answer every scenario involving amendments, relocation, additional KBLI codes, renewal, expansion, or a change in business scale. Existing operators should not assume that an old licence automatically covers a new activity or location. Each change should be checked through OSS and with qualified Indonesian advisers.
Investors considering hotel investment in Bali should treat the policy as a due-diligence checkpoint rather than a simple size test. Before committing capital, verify the following:
1. The correct KBLI for the proposed hotel and its current risk classification
2. Whether foreign ownership is permitted for the selected business activity and scale
3. The actual building area and whether it matches approved plans
4. Spatial planning and zoning through the relevant RDTR or KKPR process
5. Land title and the legal rights held by the project company
6. Environmental, building, safety, and operational approvals
7. The current OSS result for the exact company, activity, and Bali location
8. Any continuing LKPM and post-licensing compliance obligations
Project marketing materials should not replace documentary review. Statements about room count, building area, land title, zoning, permits, construction status, or regulatory eligibility should be supported by current project documents and reviewed by qualified professionals.
The 2026 restriction signals closer scrutiny of whether foreign-owned businesses have real operations, correct classifications, and a verifiable presence in Bali. It also shows that a business activity can be affected by provincial implementation even when investors are familiar with the broader national investment framework.
For hotel investors, this makes early classification and site due diligence more important. The relevant question is not only whether foreign investment is generally permitted. It is whether the proposed company, hotel category, building area, location, and licence pathway satisfy the rules that apply at the time of application.
Bali did not announce a blanket closure of foreign hotel investment in 2026. It restricted access to new OSS licensing for 18 identified low and medium-low risk activities, including specified hotel categories, to protect local enterprises and strengthen licensing oversight.
The safest approach is to verify the exact project rather than rely on general claims about room count or investment scale. A current OSS assessment, supporting property and permit documents, and advice from licensed Indonesian legal and investment professionals should form part of the decision process.
PT THE CUBE GROUP (CUBE Group) is a Bali-based developer behind CROSS Bali Uluwatu, a planned 120 to 130-key upper-upscale hotel in Pecatu, Uluwatu, operated under a Hotel Management Agreement with Cross Hotels & Resorts. The project is structured through a PT PMA holding Hak Guna Bangunan (HGB) land title, one of several hotel ownership structures used in Bali.
Investors evaluating opportunities connected with CUBE should request the same project-level evidence as they would for any hotel investment in Bali. This includes current documentation for the project company, site, land rights, zoning, building area, permits, construction status, and hotel operating structure.
The Bali Provincial Government said the restriction was intended to protect local micro, small, and medium enterprises and respond to suspected misuse of low and medium-low risk licensing by some foreign-owned businesses.
The official provincial announcement lists 18 activities in low and medium-low risk categories.
No. The official list includes starred hotels with building areas below 6,000 square metres and non-star hotels. It does not state that every foreign-owned hotel is prohibited.
The official provincial announcement reviewed for this article does not mention a 101-room minimum or a 100-employee threshold. It refers to building area, specifically starred hotels below 6,000 square metres, within the affected list. A closer look at how Bali’s OSS risk tiers use room count, staff, and building size together explains where the 101-room figure actually comes from.
No automatic eligibility can be inferred from the announcement. Investors still need to verify KBLI classification, foreign ownership eligibility, zoning, land rights, permits, operational standards, and the current OSS response.
The provincial announcement says existing licence holders must continue submitting LKPM reports. Amendments, relocation, expansion, or added business activities may require separate review.
· Bali Provincial Government, 23 July 2026: OSS access restrictions for PMA in selected KBLI
