Bali Zoning Regulations for Land & Foreign Investment

Bali’s Governor, Wayan Koster, has taken a bold step to protect the island’s agricultural land and cultural balance. Starting this year, the provincial government will no longer issue permits to convert productive land into tourism accommodations such as villas, resorts, or other hospitality facilities. This move is part of Bali's broader strategy to maintain its agricultural integrity and cultural heritage.

For foreign investors and expatriates considering property or business ventures in Bali, this policy marks a critical turning point. Understanding the legal framework, including Bali zoning regulations for land and foreign investment, and compliance requirements has never been more important for successful investments in Bali.

Bali Zoning Regulations for Land & Foreign Investment Conversion

Governor Koster announced that a new Regional Regulation (Peraturan Daerah / Perda) on Land Conversion has been signed and will soon be enforced, impacting how foreign investment can be structured in Bali.

Key Highlights

• No new permits for tourism-related facilities on productive land (farmland or other agricultural areas).

• Stricter monitoring by both the provincial government and local councils (DPRD Bali).

• Active enforcement that includes demolition of illegal buildings, as recently seen at Bingin Beach in South Kuta, Badung.

• Koster has personally led several high-profile enforcement actions, signaling that this is not just a symbolic regulation—it is an active policy with real consequences for those seeking to invest in Bali.

Why This Matters for Expats and Foreign Investors?

Foreign investors in Bali often look for scenic land to develop villas or small resorts, but the new Perda changes the game for foreign investment:

• Illegal construction risks demolition: Bingin Beach demolitions are an example of Bali’s “zero tolerance” on non-compliant businesses.

• Land leases must comply with zoning: Productive land cannot be casually repurposed into tourism use without the proper legal framework.

• Future investments require more due diligence: Without clear land-use permits, your investment could face legal and financial losses.

Bali Zoning Regulations and Foreign Investment

The new zoning regulations in Bali are particularly important for foreign investors. These regulations dictate how land can be utilized and ensure that agricultural land is preserved. Foreign investment in Bali is subject to these zoning laws, which means that:

• Foreign investors must navigate complex zoning classifications that determine permissible land uses.

• Investments in land that do not comply with these zoning regulations may be rendered invalid, leading to significant financial losses.

• Understanding the local zoning laws is essential to avoid potential legal disputes and ensure compliance with government policies.

How to Stay Compliant

For expatriates or foreign businesses planning to invest in Bali:

1. Verify Zoning Status Before Leasing or Buying Land

Productive (agricultural) land cannot be legally converted into villas or tourist accommodations without proper approval, which is crucial for foreign investment.

2. Use the Correct Business Structure

A PT PMA (foreign investment company) is required for most tourism-related businesses. Ensure your PT PMA business activities match the land-use permit.

3. Conduct Legal Due Diligence

Work with a qualified Bali business lawyer to check land status, permits, and local regulations before signing any agreement related to foreign investment.

4. Stay Updated on Local Enforcement

The government has nine other locations under review for violations similar to Bingin Beach. Compliance now prevents future penalties for foreign investors.

In light of Bali’s new land-use regulations, it's clear that ensuring legal compliance is essential for a secure investment. At Vidhi Law Office, we are here to guide you through this process with care and expertise:

• Comprehensive property and land due diligence tailored for foreign investors.

• Support with PT PMA establishment and ongoing compliance.

• Assistance in navigating local permit and licensing requirements.

• Expert advice on zoning and tourism regulations in Bali.

Consult our team before committing to any land or tourism project in Bali to ensure your investment is secure and prepared for future changes in the regulatory landscape.