Over the past 16 months, Bali’s provincial government and the island’s immigration offices have moved from warnings to action against villas and businesses operating without the right permits. If you plan to buy, live in or rent out a villa in Bali, the permit file now matters as much as the floor plan.
What has happened since mid-2025
The crackdown has built up in steps. The main moments, in order:
1 June 2025: Governor Wayan Koster formed a cross-agency team to audit tourism business licences across Bali. He said some operators were exploiting loopholes in the national online licensing system (OSS), and that in Badung alone around 400 car-rental and travel-agency permits were held by foreigners.
21 July 2025: Officials began demolishing cliffside villas, bars and restaurants at Bingin Beach, Uluwatu. The governor said none of the buildings had permits and that the area was meant to be green belt. Business owners told the ABC that some Australians were partners in the affected businesses.
Early December 2025: Koster said more than 2,000 hotels and villas were operating without permits or paying tax, and that action would follow in 2026.
Third week of May 2026: Bali closed OSS access for new foreign-investment registrations in 18 low and medium-low risk business categories. The list includes star-rated hotels, budget hotels, owned or leased real estate and “other accommodation”.
30 May 2026: The governor said online travel agents had agreed not to market accommodation that has no business licence.
12 September 2026: A villa built in a protected production forest at Pejarakan, Buleleng, was demolished after three warning letters. Officials said it lacked a spatial-use conformity permit (KKPR) and a forestry permit.
21 September 2026: Koster told the provincial parliament that about 5,000 villa businesses had applied for permits during 2025–2026. He also said hotel and restaurant tax revenue was more than Rp 300 billion higher than in the same period of 2025. These are the governor’s figures.
5–9 October 2026: Ngurah Rai Immigration deported 10 foreigners. Three held investor stay permits. One was reported to have promoted a villa outside the scope of his permit, and an Australian kept operating after his business licence had been revoked.
16 October 2026: Speaking to Bali’s travel-agent association, the governor repeated the message: if you want to be marketed, get your licence first.
Why the focus on permits
The provincial government gives several reasons. Unlicensed villas pay no local accommodation tax while drawing guests from licensed hotels. Small Balinese businesses face competition from foreign-owned operators using low-cost registrations. And buildings in green belts, forests or river and coastal setbacks add to the spatial-planning and flooding problems the island already faces.
Whatever your view of the politics, the direction is clear. Booking platforms, immigration and local enforcement officers are all checking paperwork more closely than they did two years ago.
The permits a villa should have
Living in a villa and renting it to guests are treated differently. Renting by the night is a business activity and needs business licensing on top of the building permits. In broad terms:
| Document | What it is | Why it matters |
|---|---|---|
| Land certificate | The registered title to the land | Shows who can lawfully lease or sell the land |
| KKPR (spatial-use conformity) | Confirms the planned use fits the spatial plan, processed through OSS | Building outside the permitted use is what triggered several demolitions |
| PBG (building approval) | Replaced the old IMB in 2021 under Government Regulation 16/2021; records the building’s function and classification | Without it, a building can face administrative sanctions |
| SLF (certificate of function) | Issued by the local government to confirm the finished building is fit to be used | Required before the building is put into use |
| Business licensing via OSS | Business identification number (NIB) under the correct business classification (KBLI), plus any standard certificate the activity requires | Needed only if the villa is rented to guests; platforms now ask for it |
The national risk-based licensing system that sits behind OSS was updated in 2025: Government Regulation 28/2025 replaced the 2021 rules. Accommodation is also subject to the regency’s local tax on hotel services.
One recurring problem is a mismatch between the licence and the real activity. A company registered for real-estate activities is not automatically licensed to run nightly rentals. Officials have raised this exact issue in Bali in 2026.
Questions to ask before you buy
Use these as a starting list for the seller and for your own adviser:
Can I see the land certificate, and does the name on it match the party leasing or selling to me?
What is the zoning for this plot, and is there a KKPR for the intended use?
Has the PBG been issued, and for which building function?
Will an SLF be issued on completion, and who arranges and pays for it?
If I plan to rent the villa out, who will hold the business licence, under which classification, and is it registered for local tax?
Is any part of the land in a green belt, protected farmland, forest, or a river, coastal or cliff setback?
Is anyone in the chain holding land or shares on someone else’s behalf?
Who manages the villa after handover, and are they licensed for that activity?
This article explains the general picture. It is not legal or tax advice. Ask an independent notary (PPAT) or lawyer, chosen by you rather than the seller, to check the documents before you sign or pay.
What this means for Valora Sanur
At Valora Sanur, the PBG (building approval) and SLF (certificate of function) are included in the price of every villa, so the two building documents in the table above are not a separate cost or a separate task for the buyer. Water and electricity are connected as part of the villa.
Valora is nine villas behind one gate on Jl. Bumi Ayu in Sanur, currently under construction with a target completion of May 2027. After handover, a professional villa management partner looks after operations.
If you would like to look through the permit documents with your own notary, visit our marketing gallery on site in Sanur, open daily from 10 AM to 5 PM, or contact the team at atrea.id.
Sources
ANTARA News — “Bali forms special team to crack down on illegal foreign businesses” — 1 June 2025 — https://en.antaranews.com/news/357285/bali-forms-special-team-to-crack-down-on-illegal-foreign-businesses
The Jakarta Post — “Bali to clamp down on illegal foreign-owned businesses” — 3 June 2025 — https://www.thejakartapost.com/indonesia/2025/06/04/bali-to-clamp-down-on-illegal-foreign-owned-businesses.html
ABC News — “Bali officials begin demolishing Bingin Beach tourist spots, declaring ‘none of them have permits'” — 22 July 2025 — https://www.abc.net.au/news/2025-07-22/bali-crackdown-on-bingin-beach-tourist-villas-restaurants/105558256
Bali Expat (citing CNN Indonesia and CNA) — “Bali Hotels Struggle as Illegal Villas Rise, Governor Calls for Regulation” — 5 December 2025 — https://baliexpat.com/2025/12/05/bali-hotels-struggle-as-illegal-villas-rise-governor-calls-for-regulation/
ANTARA News — “Bali blocks foreign investment in 18 business categories” — 23 July 2026 — https://en.antaranews.com/news/423748/bali-blocks-foreign-investment-in-18-business-categories
Kompas.com — “Koster Sorot Vila Ilegal di Bali: Rusak Tatanan Pariwisata, Tak Adil” — 31 May 2026 — https://denpasar.kompas.com/read/2026/05/31/080404978/koster-sorot-vila-ilegal-di-bali-rusak-tatanan-pariwisata-tak-adil
Balijani.id — “Sikat Praktik Nominee Investor Asing, Gubernur Koster Bongkar Vila Ilegal di Pejarakan Buleleng” — 12 September 2026 — https://balijani.id/sikat-praktik-nominee-investor-asing-gubernur-koster-bongkar-vila-ilegal-di-pejarakan-buleleng/
Bali Post — “Vila di Hutan Pejarakan Dibongkar, Satpol PP Bali Tegaskan Aturan Tak Boleh Dilanggar” — 12 September 2026 — https://www.balipost.com/news/2026/09/12/581123/Vila-di-Hutan-Pejarakan-Dibongkar,…html
IDN Times Bali — “5 Ribu Vila di Bali Ajukan Izin usai Penertiban Online Travel Agent” — 21 September 2026 — https://bali.idntimes.com/news/bali/5-ribu-vila-di-bali-ajukan-izin-usai-penertiban-online-travel-agent-00-pfsg1-ck7vhz
Rakyat Merdeka (rm.id) — “Imigrasi Ngurah Rai tindak 10 WNA bermasalah” — 15 October 2026 — https://rm.id/baca-berita/nasional/330247/imigrasi-ngurah-rai-tindak-10-wna-bermasalah
The Bali Times — “10 Foreigners Deported From Bali Over Villa Promotion, DJ Work and Other Violations” — 14 October 2026 — https://thebalitimes.com/the-island/10-foreigners-deported-from-bali-over-villa-promotion-dj-work-and-other-violations/
ANTARA News Bali — “Koster minta platfrom akomodasi tak pasarkan vila bodong” — 16 October 2026 — https://bali.antaranews.com/berita/415805/koster-minta-platfrom-akomodasi-tak-pasarkan-vila-bodong
Hukumonline / SIP Law Firm (explainers on PP 16/2021: PBG replaces IMB, SLF before use) — https://siplawfirm.id/id/publikasi/persetujuan-bangunan-gedung-pbg-resmi-menggeser-keberlakuan-izin-membangun-bangunan-imb-bagaimana-implementasinya
Hukumonline — “Pemerintah tegaskan PP 28/2025 jadi satu-satunya acuan perizinan usaha berbasis risiko” — 2025 — https://www.hukumonline.com/berita/a/pemerintah-tegaskan-pp-28-2025-jadi-satu-satunya-acuan-perizinan-usaha-berbasis-risiko-lt68624e9dd6fd1
The Bali RealEstate Dispatch (newsletter summarising local media; provincial investment office on real-estate-coded companies renting by the night) — w41, 9 October 2026 — https://balirealestate.substack.com/p/the-bali-realestate-dispatch-w41-c70