Bali closes OSS access to new foreign investment in 18 business sectors

Denpasar — Bali has blocked new foreign direct investment in 18 low- and medium‑low‑risk business categories by closing access to Indonesia’s Online Single Submission (OSS) system for new PT PMA registrations in those activities, according to an official announcement by the provincial government and multiple investment advisories in July–August 2026.

The restriction applies to new foreign‑investment company licences in the affected categories and does not cancel licences already issued, according to the Bali government and advisory firms that have reviewed the policy.

Provincial officials say the move is intended to protect local micro, small and medium enterprises (MSMEs) from what they describe as unfair competition from foreign investors in small‑scale, consumer‑facing businesses.

Which activities are affected

According to the Bali provincial government, the OSS access closure covers 18 KBLI business classifications in low‑ and medium‑low‑risk categories.

The list includes several hospitality and accommodation activities, notably star‑rated hotels with a building area below 6,000 square metres, budget or “melati” hotels, and other short‑term accommodation services such as villas and guesthouses.

Real estate operations on self‑owned or leased property are also included, alongside management consulting and industrial management consulting services.

Vehicle rental is covered through KBLI codes for car, bus and truck rental, as well as motorcycle rental.

Retail trade categories in the list include retail sale of clothing, retail sale of textiles, retail sale of food and mobile retail of agricultural food products.

The food, leisure and personal‑service sectors are affected through classifications for cafés and bars, traditional medicine shops, made‑to‑order tailoring and several sports and recreational facilities, including stadium operations, fitness centres and sports event promotion.

Investment and advisory firms have published English‑language summaries of the closed KBLI list that mirror the provincial announcement and confirm that new PT PMA licences can no longer be registered through OSS in these 18 activities in Bali.

What the restriction means for foreign investors

For foreign investors, the practical effect is that new PT PMA companies cannot obtain OSS approval for business lines falling under the 18 KBLI codes in Bali, even though those activities remain open to Indonesian‑owned firms and existing foreign‑investment companies with prior licences.

Several advisory firms state that the measure took effect in the third week of May 2026, after coordination between the Bali provincial government and the Ministry of Investment/BKPM, and was publicly announced on 23 July 2026.

Existing PT PMA licences in the affected sectors are not revoked by the policy, but companies may face limits on adding new closed KBLI codes or expanding small‑scale accommodation and service operations under new foreign‑investment registrations in Bali.

Advisers note that investors considering accommodation, food service, vehicle rental, retail or consulting activities in Bali now need to assess whether their planned KBLI falls within the closed list and, if so, whether alternative structures or different business lines remain available under Indonesian ownership rules.

Legal basis and policy context

The Bali provincial government states that the OSS access restriction was introduced after it obtained approval from the central government and is implemented through a decision covering 18 KBLI categories in the low‑ and medium‑low‑risk bands.

According to the governor’s announcement, the policy responds to a rapid increase in foreign‑owned small hotels, rentals and shops operating in areas traditionally occupied by local MSMEs, and aims to “protect local MSMEs from unhealthy competition” while improving the quality and scale of foreign investment entering the island.

Local business and real‑estate platforms describe the change as a restructuring of foreign‑investment access rather than a blanket closure of Bali to foreign investors, noting that larger‑scale projects and higher‑risk sectors remain open under national investment rules and OSS procedures.

Advisories expect further clarification from national and provincial authorities on how the restriction will interact with licence renewals, business‑line changes for existing PT PMA companies and any future adjustments to the closed KBLI list.

Sources

• Pemerintah Provinsi Bali
• Bali Discovery
• Magnum Estate
• Social Expat
• Incorp Indonesia
• Cube Bali
• Polarius Real Estate
• HKTDC Research