Yes, there are restrictions on the business sectors open to foreign investment in Bali, as well as in Indonesia as a whole. These restrictions are outlined in the Negative Investment List (DNI), which is a regulation issued by the Indonesian government that specifies the sectors where foreign investment is prohibited or limited.
The DNI is updated periodically, with the most recent revision being issued in 2021 through Presidential Regulation No. 10/2021. This revision is known as the Positive Investment List, as it shifts the focus to sectors that are open to foreign investment, with conditions.
Here are some key points regarding foreign investment restrictions in Bali:
Prohibited Sectors: Certain business sectors are completely closed to foreign investment. These include:
- Gambling and casinos
- Marijuana cultivation and distribution
- Wildlife trade and hunting
- Historical artifact trade
Limited Sectors: Some sectors are open to foreign investment but with limitations on the maximum foreign ownership allowed. For example:
- Restaurants (maximum 51% foreign ownership)
- Bars and nightclubs (maximum 51% foreign ownership)
- Travel agencies (maximum 70% foreign ownership for ASEAN investors, 67% for non-ASEAN investors)
- Spas (maximum 51% foreign ownership)
Partnership Requirements: In some cases, foreign investors are required to partner with an Indonesian company or individual to operate in certain sectors. This is common in sectors like construction, where a local partner is often necessary.
Minimum Investment: Certain sectors may have minimum investment requirements for foreign investors. For example, to establish a 100% foreign-owned PMA company, the minimum investment is IDR 10 billion (approximately USD 700,000).
Specific Licenses: Some sectors, such as healthcare and education, require specific licenses and approvals from relevant ministries in addition to the standard business licenses.
It's crucial for foreign investors to carefully review the DNI and consult with experienced professionals like Okusi Associates to understand the restrictions and requirements applicable to their desired business sector in Bali.
Okusi Associates can provide guidance on the most suitable business structure and assist in navigating the complex regulatory landscape to ensure compliance with foreign investment restrictions. They can also help in identifying potential local partners if required and in obtaining the necessary licenses and approvals for your specific business sector.
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