On Tuesday, February 24, 2026, the Governor of Bali, I Wayan Koster, officially signed and enacted Local Regulation (Perda) Number 4 of 2026. This landmark legislation focuses on the Control of Productive Land Conversion and the strict Prohibition of Nominee Land Ownership Transfer.
Governor Koster emphasized that this policy is a strategic move by the Bali Provincial Government to ensure the sustainability of the island’s productive land while protecting local ownership from high-risk, unregulated practices.
“This regulation exists to protect agricultural, horticultural, and plantation land so they continue to serve as the backbone of food sovereignty, economic independence, and Bali’s ecological balance,” stated Governor Koster.
Key Objectives of Bali Perda no 4/2026
Under this regulation, any attempt to convert productive rice fields into commercial buildings, such as villas, no longer carries only administrative risks but can also lead to criminal prosecution.
“It also serves as a guideline for regencies and cities to control land conversion, while ensuring there are no more illegal nominee practices,” Koster added.
The regulation focuses on:
▪ Protecting Productive Land: Ensuring agricultural lands remain the backbone of Bali’s economy.
▪ Ending Illegal Nominee Practices: Providing a clear legal framework to prevent “borrowed name” schemes.
▪ Ecological Balance: Maintaining the traditional Subak systems and green belts.
Criminal Sanctions for Nominee Practices and Land Conversion
Regarding enforcement, Perda 4/2026 mandates strict penalties for both land conversion violators and any individual acting as an intermediary or facilitator for foreign nationals using nominee schemes.
▪ Law No. 41 of 2009: Illegal conversion of sustainable agricultural land is punishable by up to 5 years in prison and a fine of IDR 1 billion.
▪ Law No. 26 of 2007: Spatial planning violations carry a 3-year prison sentence and fines up to IDR 500 million.
▪ KUHP Provisions: If document manipulation or ownership fraud is found, general criminal charges will also be applied.
Administrative Sanctions for Violators
The Bali Provincial Government has prepared an “escalation of consequences” for those who bypass the new rules:
⮕ Temporary suspension of business operations and construction.
⮕ Closure and sealing of locations.
⮕ Revocation of business licenses and fiscal incentives.
⮕ Heavy administrative fines and mandatory building demolition.
Civil Servants (ASN) found assisting in these violations will face severe disciplinary action and potential criminal abuse-of-authority charges.
Investing in Accordance to the Regulation
With Perda No. 4/2026, the “rules of the game” for property in Bali are now crystal clear. Land verification is significantly stricter, and the “borrowed name”/nominee practice is now subject to criminal sanctions. The good news? This creates a level playing field for all investors.
The expected result is a healthier, more transparent investment climate. Data shows that investment in the property and accommodation sector has surged from approximately IDR 18 trillion in 2021 to IDR 36 trillion in 2025. With these firmer regulations, we expect investment to remain high in value but also high in quality, without compromising Bali’s spatial planning.
Secure Your Investment with Seven Stones Indonesia
Understanding the shift from “grey areas” to strict legal enforcement is now no longer optional, it is a necessity for any serious investor. With local regulations shifting, you need a partner who understands the fine print.
For over 20 years, Seven Stones Indonesia has provided the legal expertise needed to navigate Bali’s complex property laws. Reach out to us today to ensure your investment is built on a compliant, secure, and future-proof foundation.