Bali Governor Koster Closes Foreign Investment Access for Various Business Sectors

Bali Governor Wayan Koster has closed access for foreign investment (PMA) to a number of business sectors on the island. The restricted sectors include accommodation, rental services, retail trade, and consulting services, among others deemed to be closely linked to micro, small, and medium enterprises (MSMEs).

The action was taken after the discovery of indications that licensing loopholes were being exploited, allowing foreign investors to enter sectors reserved for MSMEs. Koster stated that this situation had the potential to create unfair competition and exert significant pressure on the sustainability of local Balinese businesses.

Koster explained that the restriction was necessary because foreign investors could easily invest in low-risk business classifications through the Online Single Submission (OSS) system, which only required a Business Identification Number (NIB). He noted that this gap was exploited by several foreign investment companies to establish businesses, including through the use of virtual offices.

Koster confirmed that the restriction on foreign investment had been approved by the Minister of Investment and Downstream Industry, Rosan Roeslani, and was implemented starting in the third week of May 2026. He emphasised that with this closure, foreign investors can no longer apply for new business permits through the OSS system for the specified business classifications until further policy is established in accordance with prevailing laws and regulations.