Bali Government Acts on People's Petitions Regarding Foreign-Owned Businesses

Bali's Governor I Wayan Koster has summoned an emergency coordinating session involving the most important regional and national institutions to handle an escalating public outcry: the number of foreign-owned tourism enterprises conducting business on the island without the right local connections or physical presence.

The increase of foreign investors operating businesses such as car rentals, tour operations, and home stay businesses frequently without having operational premises on the island has fueled criticism from local business people and community members.

OSS Licensing Scheme Under the Scanner

Governor Koster highlighted the need for Bali not to become an "open market" to the detriment of its citizens. He made it clear how Indonesia's Online Single Submission system has inadvertently facilitated illegal or inadequately regulated foreign companies.

There are more than 400 foreign-owned travel and transportation businesses, many with no office and no verifiable place of residence in Badung Regency alone, according to the authorities.

Government Action

To address this problem, the Provincial Government of Bali has initiated the establishment of a multi-agency working team to monitor foreign-owned businesses and enforce the regulations. There is to be a new Circular Letter on the Management of Tourism and Transportation Businesses to legalize the move.

Chief among them are:

• Registration of the travel agency with the local association is mandatory.

• Verification of business conduct on the premises to eradicate "paper companies"

• Extensive analysis of the OSS licensing model and loopholes

So, what does this mean if you are a foreign business owner in Bali? If you're already running or about to run a business operating in the tourism industry of Bali, you should now review your level of compliance with the laws. Non-registered and unverifiable businesses may receive audits, administrative sanctions, and even closure.

The action is part of the overall strategy of the government to safeguard the economy of Bali, maintain equal competition, and end illegal foreign involvement in regulated sectors.

At Vidhi Law Office, our focus is on assisting you, foreign investors in navigating the intricacies of Indonesian business regulations. As new enforcement measures roll out, having your company legally compliant is more important now than ever before.

Our Bali expert lawyers are available to help you with

• OSS-based licenses review and validation

• Evaluating the company's corporate structure to ensure complete compliance

• Coordination with notaries, sponsor agencies, and ministries

• Preparing to undergo audits or to answer official queries

• Membership in relevant tourism associations or acquiring special permits

If you're launching a new venture or adjusting your existing business to meet updated regulations, we offer personalized and strategic advice tailored to your needs.

Contact Vidhi Law Office today to ensure your business remains compliant, legally sound, and prepared for the evolving regulatory landscape in Bali.