Bali’s villa sector is facing significant regulatory changes. At this week’s Bali Villa Connect 2026 forum, industry leaders discussed introducing an official villa classification system similar to hotel star ratings.
At the same time, authorities announced that approximately 1,600 unlicensed accommodation properties have already been identified and could be removed from online booking platforms as early as this summer.
Held on 26–27 May at the Denpasar Convention Center, Bali Villa Connect 2026 brought together more than 900 industry participants, including villa operators, investors, government officials, agencies, OTA representatives, and marketing companies. While the event addressed the continued growth of Bali’s villa market, much of the discussion focused on the need for stronger regulation and industry standards.
Proposed Villa Classification System
Unlike hotels, Bali’s villa market currently lacks a formal classification framework. As a result, luxury villas often compete directly with standard accommodation providers, leading to significant pricing pressure and market distortion.
The Bali Villa Rental and Management Association (BVRMA) has proposed the introduction of a one-to-five-star classification system for villas. The framework is expected to assess factors such as building quality, service standards, facilities, infrastructure, and operational management.
The system is currently being developed in cooperation with universities and academic institutions. BVRMA aims to finalize the standards by the end of this year, with implementation targeted for 2027.
Authorities Target Unlicensed Villas
A major focus of the forum was the growing number of unlicensed accommodation businesses operating across Bali. Industry representatives highlighted concerns regarding uncontrolled development, improper land use, waste management issues, traffic congestion, and aggressive price competition.
Although approximately 12,000 accommodation businesses are officially registered in Bali, many properties continue to operate without complete legal documentation.
To address the issue, Indonesian authorities have begun working directly with international Online Travel Agent (OTA) platforms, including Booking.com and Airbnb, to synchronize licensing data and improve compliance monitoring.
The Ministry of Tourism has identified approximately 1,600 accommodation properties listed on booking platforms that currently lack the required licenses. These findings have already been verified by the authorities.
Removal from Booking Platforms
Beginning on 2 June, OTA platforms will receive lists of non-compliant properties that may be subject to removal.
Property owners will be granted a two-month compliance period to obtain the necessary licenses. If a property fails to secure the required documentation by 1 August 2026, it may be removed from OTA listings and become unavailable for online booking.
Authorities are primarily focusing on three key business registration requirements:
- NIB (Nomor Induk Berusaha) – Business Identification Number
- KBLI (Klasifikasi Baku Lapangan Usaha Indonesia) – Business Activity Classification Code
- NKU (Nomor Kegiatan Usaha) – Business Activity Registration Number
The government also plans to integrate these requirements into a unified API-based verification system, which is expected to launch in June 2027.
Government Position
Tourism Minister Widiyanti Putri Wardhana emphasized that online platforms should no longer accept new accommodation listings that do not possess the required licenses.
According to the Minister, the objective of the reform is not to shut down businesses but to create a more transparent, sustainable, and professionally regulated accommodation sector. Authorities have also indicated that assistance will be provided to property owners seeking to regularize their legal status, including support with business registration requirements.
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