Documents needed for a Hotel License

Discover how to secure a hotel license in Bali and operate your business legally in accordance with local laws and standards.

Bali's stunning landscapes and rich culture attract numerous tourists and expats, leading to a high demand for accommodations. This presents excellent opportunities for foreign investors in the hospitality sector. Whether you're looking to open a small or large hotel, understanding local regulations is essential.

To legally run a hotel in Bali, obtaining the correct licenses is necessary. This article will walk you through the process of acquiring a hotel license and the requirements for doing so in Bali.

How to Acquire a Hotel License in Bali

All foreign-owned hotels in Bali must be properly licensed to generate revenue from services. This rule applies whether you manage the hotel independently or through a third party like Airbnb. 

Licensing ensures that hotels adhere to the standards set by the Indonesian Ministry of Tourism regarding amenities, construction, and service quality. 

Follow these steps to successfully establish and run a hotel business in Bali: 

1. Incorporate Your Company

You need to register your business with the relevant government bodies to ensure it is legally recognized and categorized correctly.

2. Build or Purchase Your Hotel

If constructing your hotel from scratch, secure all necessary permits and construction clearances. If buying an existing hotel, ensure all property documents comply with local regulations. Emerhub can assist you in avoiding legal issues when obtaining the necessary permits for your hotel. 

3. Obtain a Hotel License

Apply for a hotel license from the Department of Tourism (DOT) to operate legally and maintain quality services. Refer to the hotel license requirements below for detailed information. 

4. Apply for Additional Operational Licenses

• Local Revenue Tax (NPWPD): Register for a local revenue tax with the local government unit (LGU) where your hotel is situated.

• Ground Water Intake (Air Bawah Tanah) License: If your hotel needs ground water usage, apply for the necessary permits from the National Water Resources Board (NWRB).

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Hotel License Requirements in Bali

A fully foreign-owned hotel must occupy at least 4000 m² to qualify for licensing and meet one of Bali's hotel grading classifications. 

When starting an accommodation business, you can choose the grade, ensuring your establishment meets the criteria:

• Apartment Hotel: Hotels offering amenities akin to apartment living, including a kitchen, bathroom, sleeping area, and other lounging spaces.

• Hotel Melati (Non-Star Hotel): Hotels providing only basic amenities, without additional services, known as non-starred hotels. All necessary licenses for operating a hotel melati are issued by BKPM and are valid for three years. 

• Hotel Berbintang with 2,3,4,5 stars: Accommodations offering amenities, services, and locations that improve with the number of stars. A 3-star hotel under Hotel Berbintang must have at least 25 rooms.

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Requirements Based on Hotel Size

Since 2021, Bali's Ministry of Tourism has introduced a Risk-Based Business Licensing system, assessing businesses' risk levels based on various factors, including hotel size.  

Here's how the risk-level assessment requirements differ depending on hotel size: 

Additional Certifications for Hotel Licensing in Bali

• Hygiene Standards: Hotels must comply with hygiene and sanitation standards to ensure guest safety and health. 

• Safety Protocols: Certification may require proof of emergency procedures, fire safety measures, and evacuation plans.

• Proper Facilities: Hotels must demonstrate they have adequate facilities, such as proper waste management, clean water systems, and well-maintained infrastructure.