Starting a Co-Working Space in Bali 2027: All Permits Explained

How to Start a Co-Working Space in Bali and Get All Permits 2027

Bali continues to attract digital nomads and entrepreneurs, making co-working spaces a viable business venture. However, the regulatory landscape for foreign-owned companies (PT PMA) has undergone significant changes. As of late 2025 and continuing into 2027, new PT PMA registrations for low-risk and medium-low-risk KBLI (Standard Indonesian Business Field Classification) codes are blocked via the Online Single Submission (OSS) system. This critical policy shift necessitates a strategic approach when planning your co-working space.

For a co-working space, the key is to correctly identify the KBLI code that qualifies as medium-high or high-risk, or to explore alternative compliant structures. Typically, a co-working space primarily offering office facilities and shared workspaces falls under KBLI 68110 (Rental of Office Buildings and Shops), which is often classified as a medium-low risk. This classification now presents a significant hurdle for new foreign investment.

PT PMA Restrictions for Co-Working Spaces 2027

The blocking of low and medium-low risk KBLI codes for new PT PMA registrations means that direct foreign ownership in these sectors is no longer straightforward. Investors seeking to establish a co-working space must consider two primary pathways:

1. Re-evaluating KBLI Codes: Explore if additional services can be integrated that push the overall business into a medium-high or high-risk KBLI category. For instance, if the co-working space offers extensive event management, specialised training programmes, or high-tech incubation services beyond basic office rental, a different KBLI code might apply. This requires meticulous analysis of the specific services offered and their corresponding KBLI classifications, which can be complex.
2. Local Partnership (PT PMDN): Partnering with a local Indonesian entity or individual to establish a PT PMDN (domestic-owned company) could be a viable alternative. While this involves relinquishing full foreign ownership, it bypasses the PT PMA restrictions on low-risk KBLI codes. Careful legal agreements are essential to protect the interests of all parties.

Understanding these restrictions is paramount. Our team can provide guidance on Bali business license services for foreign investors, helping you determine the most appropriate structure and KBLI code for your specific co-working space concept.

Essential Permits and Licenses for Co-Working Spaces 2027

Regardless of the ownership structure, several key permits and licenses are mandatory:

• Nomor Induk Berusaha (NIB): This Business Identification Number is the fundamental license for any business in Indonesia. It is issued through the OSS system and incorporates various basic permits. The NIB will specify your business activities based on the chosen KBLI code.
• Izin Mendirikan Bangunan (IMB) or Persetujuan Bangunan Gedung (PBG): This building permit, or its newer equivalent PBG, is crucial. If you are constructing a new facility or making significant renovations, this must be secured. Ensure the property is zoned for commercial use.
• Sertifikat Laik Fungsi (SLF): This Certificate of Building Worthiness confirms that your building is safe and fit for its intended purpose, complying with all technical requirements. It is obtained after the PBG is issued and construction is complete.
• Environmental Permits (SPPL/UKL-UPL): Depending on the scale and potential environmental impact of your co-working space, you will need either a Statement of Environmental Management Capability (SPPL) or an Environmental Management Effort and Environmental Monitoring Effort (UKL-UPL) permit. Larger operations will require UKL-UPL.
• Commercial Property Permits Bali: Beyond the building itself, ensure the property has the correct designation for commercial use. This is distinct from residential zoning and is a common pitfall for new businesses. Verify this with local planning authorities.
• Other Operational Permits: Depending on additional services, you may need specific licenses. For instance, if you plan to serve food and beverages, a restaurant or café license will be required. If you host events with live music, entertainment permits are necessary.

Property Acquisition and Zoning Considerations 2027

Securing the right commercial property is a critical step. Bali’s zoning regulations are strict and enforced. Do not assume a property is suitable for commercial use just because it appears to be in a commercial area. Always verify the zoning status (RDTR – Rencana Detail Tata Ruang Kabupaten/Kota) with the local government. Leasing commercial property for a co-working space often requires a specific lease agreement that acknowledges the commercial intent and duration. Freehold land for foreign ownership is not permitted; therefore, long-term leasehold (Hak Sewa or Hak Guna Bangunan – HGB) is the common approach for securing property.

The Importance of Professional Assistance 2027

Given the complexities of KBLI classifications, the ongoing PT PMA restrictions, and the intricate permit application processes, engaging professional assistance is highly recommended. A local consultant or legal firm specialising in Indonesian business law can help navigate these challenges, ensuring compliance and expediting the process.

Our services include comprehensive assistance for Bali business license applications, tailored to the specific requirements of 2027. We can help assess your business model, identify the correct KBLI codes, and manage the entire permit acquisition process, from NIB to operational licenses.

2027 Note: The regulatory environment in Bali, particularly regarding foreign investment and business classifications, is subject to ongoing review and potential adjustments. While the core restrictions on low and medium-low risk KBLI codes for PT PMA are expected to remain in force, it is always prudent to verify the latest regulations directly with official sources or through experienced local consultants prior to making significant investments.

FAQ

What are the necessary permits and business licenses for establishing and operating a co-working space in Bali by 2027?

To establish and operate a co-working space in Bali by 2027, the necessary permits and business licenses include a Nomor Induk Berusaha (NIB) based on a suitable KBLI code (likely medium-high or high-risk for PT PMA), a Persetujuan Bangunan Gedung (PBG) or Izin Mendirikan Bangunan (IMB), a Sertifikat Laik Fungsi (SLF), relevant Environmental Permits (SPPL or UKL-UPL), and proper commercial property permits Bali confirming commercial zoning. Additional operational licenses may be required for specific services such as food and beverage or event hosting.

Can foreigners directly own a co-working space business (PT PMA) in Bali in 2027?

Direct foreign ownership (PT PMA) for a co-working space in Bali in 2027 faces significant restrictions. New PT PMA registrations for KBLI codes classified as low-risk or medium-low-risk, which often include basic office rental, are currently blocked via the OSS system. Foreign investors must either align their business model with a medium-high or high-risk KBLI code or consider a local partnership (PT PMDN) to proceed.

What are the key considerations for commercial property permits Bali when setting up a co-working space?

Key considerations for commercial property permits Bali involve ensuring the chosen land or building is zoned for commercial use (verified through local government RDTR). You must secure a valid building permit (PBG/IMB) and subsequently an SLF. For foreign entities, freehold land ownership is not permitted, making long-term leasehold agreements (Hak Sewa or Hak Guna Bangunan) the standard approach for acquiring commercial property for a co-working space.