Bali is rapidly becoming one of Southeast Asia's most popular tourist and expat destinations, due primarily to its appealing climate and lower cost of living. This has resulted in a growing real estate market and an increasing number of accommodation-based services throughout the region.
This article will guide you to acquiring a villa license in Bali. You can ensure business compliance and legally collect revenue from your accommodation business in Bali.
Why do you need a license to operate a villa in Bali?
Any foreign-owned accommodation property in Bali must be adequately licensed if you wish to collect revenue from your services. This applies regardless of the type of business you run and whether it is privately run or managed through a third party such as Airbnb.
Licensing ensures that accommodations meet the standards established by the Indonesian Ministry of Tourism in terms of property amenities, construction, and quality of services offered. Given Bali’s intensified oversight of short-term rentals, proper registration is essential to maintain active listings on platforms like Airbnb and avoid the risk of administrative audits, heavy fines, or property closure.
As soon as you have incorporated your company and built or purchased a villa, you can begin the process of applying for the necessary licenses. You will need additional accommodation business operational licenses such as the local revenue tax (NPWPD) and Air Bawah Tanah (Ground Water) intake license.
How to Get a Villa License in Bali?
Criteria for obtaining a villa license
Smaller accommodation service investments in Bali are referred to as 1 Star Hotels. These accommodation services are restricted to foreign ownership because they can compete directly with small local entrepreneurs. For this reason, the alternative solution for you is to acquire a villa license, which allows 100% foreign ownership.
The villa license is classified by rank as silver, gold, or diamond, depending on the available facilities and services. The Ministry of Tourism grants the license based on an evaluation of your accommodation to ensure it meets the necessary criteria in the following areas:
- Special Requirements: You must have a hygiene certificate, a documented organizational structure, and health and safety programs.
- Villa Facility: Your accommodation must have certain amenities and facilities to ensure safety and comfort for guests and staff.
- Human Resources: You need to provide employee uniforms, competency improvement programs, employee performance programs, employee health inspection programs, career development, and security officers.
- Services: Your accommodation must provide a certain range of mandatory guest services.
Required villa-provided services
To be eligible for a villa certificate, your accommodation must provide specific services for guests. The mandatory services vary depending on rank, with silver accommodations requiring fewer services than diamond. Remember that the villa’s rank will directly impact the price range.
| Services | Silver rank | Gold rank | Diamond rank |
|---|---|---|---|
| Reservation system | ✓ | ✓ | ✓ |
| Check-in/out procedures | ✓ | ✓ | ✓ |
| Room cleaning and preparation | ✓ | ✓ | ✓ |
| Service procedure for people with disabilities or old age | ✕ | ✓ | ✓ |
| Laundry service | ✕ | ✕ | ✓ |
| Valet service | ✕ | ✕ | ✓ |
| Pick-up service | ✕ | ✕ | ✓ |
| Food and beverage serving | ✕ | ✓ | ✓ |
| Payment options with cash and card | ✓ | ✓ | ✓ |
| Complaint management | ✓ | ✓ | ✓ |
Villa facility eligibility
According to the Ministry of Tourism regulations, you must ensure your villa includes facilities and amenities that guarantee the safety and comfort of guests and staff. The proper functioning of the building is also required to qualify for a villa license in Bali.
The mandatory facilities increase based on the villa's ranking.
| Services | Silver rank | Gold rank | Diamond rank |
|---|---|---|---|
| Administration area with good air circulation and lighting | ✓ | ✓ | ✓ |
| Filing document room | ✕ | ✓ | ✓ |
| Staff area | ✓ | ✓ | ✓* |
| Parking area | ✓ | ✓ | ✓ |
| Staff toilet | ✓ | ✓ | ✓ |
| Linen storage room | ✕ | ✓ | ✓ |
| Garbage area (for both organic and non-organic waste) | ✓ | ✓ | ✓ |
| Safe electrical and clean water installations | ✓ | ✓ | ✓ |
| Power generator installation | ✕ | ✓ | ✓ |
| Safe gas installation | ✕ | ✕ | ✓ |
| Management information software | ✕ | ✓ | ✓ |
| Evacuation sign(s) | ✓ | ✓ | ✓ |
| Communication tools | ✓ | ✓** | ✓** |
| Fully functioning CCTV | ✕ | ✕ | ✓ |
| Staff prayer room | ✓ | ✓ | ✓ |
| First aid and fire safety equipment | ✓ | ✓ | ✓ |
| Storage room | ✓ | ✓ | ✓ |
| Directional sign | ✕ | ✓ | ✓ |
| Gender-based toilets | ✕ | ✓ | ✓ |
| Well maintained pool | ✓ | ✓ | ✓*** |
| Villa sign | ✓ | ✓ | ✓ |
| Pest control program | ✓ | ✓ | ✓ |
| Nearest doctor, hospital, and clinic information | ✕ | ✓ | ✓ |
| Fire and emergency prevention procedure | ✓ | ✓ | ✓ |
| Building maintenance, safety, and sanitary procedures | ✕ | ✓ | ✓ |
| Wastewater procedure | ✕ | ✓ | ✓ |
* Must also have changing and dining rooms for all staff
**Must include phone, email, and internet
***Must include children’s and adult pools. Plunge pools are not considered pools and therefore are not eligible for the villa license.
How to Acquire a Hotel License in Bali
Besides a villa license, you can also get a hotel license if you meet the necessary criteria. If you are interested in acquiring a hotel license in Bali, please refer to our guide on acquiring a hotel license in Bali for detailed information. This guide will help you understand the requirements and steps necessary to ensure compliance and successfully obtain your hotel license.