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Indonesia's Omnibus Law and its downstream regulations have materially shifted what foreign buyers can own in Bali, how it must be structured, and what due diligence is now non-negotiable. The short answer: foreign access to Bali residential property has expanded in meaningful ways, but the rules are more specific than ever - and the gap between a compliant purchase and a structurally fragile one has widened. For buyers in 2026, understanding these changes is not optional. It is the foundation of any serious ownership decision.
- Indonesia's Omnibus Law and PP 28/2025 have updated what foreigners can legally own in Bali, including streamlined licensing rules through the OSS system [2].
- Foreign buyers have three main structural routes: leasehold, Hak Pakai (right-of-use title), and ownership via a PT PMA company [3].
- Each route carries distinct ownership rights, tenure terms, and compliance requirements - the "right" structure depends on your goals, not just your budget.
- The Omnibus Law's positive investment list opened new sectors to foreign capital but did not remove the fundamental restriction on foreigners holding freehold (Hak Milik) title directly [1].
- Structuring errors at the point of purchase are very difficult to reverse - the monitoring of regulatory changes before and during a transaction is where risk is controlled.
What Did Indonesia's Omnibus Law Actually Change for Property?
The Omnibus Law (Undang-Undang Cipta Kerja) was passed with the explicit goal of strengthening Indonesia's economic competitiveness, attracting foreign investment, and improving ease of doing business [1]. For property specifically, its most consequential effect was not a single dramatic rule change - it was a reordering of the investment framework that governs what foreign capital can access and through what vehicles.
The Positive Investment List introduced under the Omnibus Law clarified which sectors are open to foreign ownership and under what conditions [1]. In property terms, this reinforced the PT PMA (foreign-owned company) route as a legitimate and commercially recognised structure for foreign buyers who want to hold Indonesian real estate assets in a compliant corporate vehicle [3].
What the Omnibus Law did not change: foreigners still cannot hold Hak Milik (freehold) title directly. That restriction remains. The Omnibus Law's contribution was to clarify and, in some cases, expand the pathways around it.
What Did PP 28/2025 Change Specifically for Foreign Buyers?
Building on the Omnibus Law's framework, Government Regulation PP 28/2025 introduced updates to property licensing and permit processing for foreign property ownership in recent years [2]. The key changes relevant to Bali buyers in 2026 include:
- Streamlined property licensing through OSS: PP 28/2025 overhauled risk-based business licensing across multiple sectors, including property. It consolidates permit processing into Indonesia's Online Single Submission (OSS) system, aiming for faster processing and clearer requirements for property-related activities [2].
- New licensing and compliance requirements: Developers and sellers working with foreign buyers face stricter documentation and licensing obligations, which directly affects due diligence requirements for buyers [2].
- Hak Pakai duration confirmed: The Hak Pakai entitlement itself - including the maximum 80-year duration (30+20+30 years) and the residency requirement - did not change under PP 28/2025. What changed is how the licensing and permit process for property-related activities integrates with the government's digital OSS system [2].
The practical effect: buyers who were previously relying on loosely structured arrangements now face a regulatory environment that requires cleaner documentation and proper legal structuring to be valid and enforceable.
What Are the Three Main Ownership Structures for Foreign Buyers in 2026?
Three routes are available to foreign buyers purchasing residential property in Bali, each with a different risk profile and appropriate use case [3].
| Structure | What It Is | Typical Tenure | Best For |
|---|---|---|---|
| Leasehold (Hak Sewa) | A long-term lease over a property, not title transfer | 25-30 years, extendable | Entry-level buyers, co-ownership structures, buyers not seeking title |
| Hak Pakai | Statutory Right of Use title, available to foreigners meeting applicable minimum value thresholds | 30 years, extendable | Foreign individuals wanting a recognised title on higher-value residential property [2] |
| PT PMA | Foreign-owned Indonesian company holding HGB (Right to Build) or HGB over freehold title | 30 years HGB, renewable | Investors or buyers wanting commercial-grade control and the ability to hold multiple assets [3] |
None of these structures is universally "best." The right choice depends on the buyer's residency status, intended use, budget, number of properties, and long-term exit strategy. This is precisely why structuring decisions should be made before a property is selected, not after.
Where Do Most Foreign Buyers Go Wrong with Regulation?
Stepping back from the technical detail, the most common failure is not ignorance of the rules - it is treating legal structuring as an afterthought. The sequence that leads to problems typically looks like this:
- Buyer identifies a property they want.
- Buyer negotiates a price and agrees terms informally.
- Legal structuring is addressed only after emotional commitment is made.
- Structure chosen is the fastest or cheapest, not the most appropriate.
- Problems with title, zoning, or tenure terms emerge post-purchase.
The regulatory updates from PP 28/2025 increase the cost of this mistake. Licensing requirements are stricter, documentation requirements have been updated, and transactions that might have passed informal scrutiny two years ago may not survive a compliance check today [2].
A related but distinct concern is nominee arrangements - where an Indonesian national holds title on behalf of a foreign buyer. This approach is not recognised under Indonesian law, carries real legal risk, and is not made safer by any of the recent regulatory changes.
How Does PARADYSE Homes Approach Regulatory Compliance?
PARADYSE Homes treats regulatory monitoring as a core operational function, not a one-time checklist. For both full ownership and co-ownership transactions, the team works through licensed Indonesian notaries and law firms to ensure every purchase is structured in line with current regulations - including the updated PP 28 framework.
For co-ownership transactions, properties are held in dedicated PT PMA special purpose vehicles (SPVs), with buyers holding Class B equity shares. This structure is ring-fenced per property, compliant with Indonesian company law, and grants investors real equity rights rather than a use-right arrangement.
For full ownership buyers, PARADYSE conducts independent due diligence covering title verification, zoning compliance, and tax-optimised ownership vehicle selection before any transaction proceeds. The structure is chosen based on the buyer's goals and residency profile, not defaulted to the most convenient option.
Frequently Asked Questions
Can foreigners own freehold property in Bali in 2026?
No. Foreigners cannot hold Hak Milik (freehold) title directly. The available routes are leasehold, Hak Pakai, or ownership through a PT PMA company [3].
What did PP 28/2025 change for foreign buyers specifically?
PP 28/2025 is a procedural regulation that overhauled risk-based business licensing through Indonesia's OSS system, including property-related licensing. It streamlined how permits are processed and clarified how property licensing integrates with the digital permit system. It did not change the fundamental property rights available to foreigners, the Hak Pakai duration, or the minimum value thresholds for Hak Pakai eligibility, which are set by separate ministerial regulations [2].
Is a PT PMA structure safe for buying property in Bali?
When properly established and maintained in compliance with Indonesian company law, a PT PMA is a recognised and commercially sound route for foreign property ownership in Bali [3]. It requires ongoing compliance obligations and should be set up with qualified legal support.
Are nominee arrangements legal in Indonesia?
No. Nominee arrangements - where an Indonesian national holds title on behalf of a foreigner - are not recognised under Indonesian law and carry significant legal risk. No regulatory change has altered this position.
How does co-ownership work legally for foreign buyers?
In PARADYSE's co-ownership model, properties are held in PT PMA SPVs. Foreign buyers hold Class B equity shares in the SPV, giving them real ownership rights, rental income entitlements, and capital appreciation exposure - not a timeshare or use-right arrangement.
Does Indonesia's Omnibus Law make it easier for foreigners to buy property?
It clarified and in some cases expanded the investment framework, including the Positive Investment List that underpins PT PMA eligibility [1]. It did not remove the prohibition on direct freehold ownership by foreigners, but it strengthened the legitimate pathways that do exist.
How far in advance should legal structuring be decided?
Before a property is selected. The structure affects which properties are appropriate, what due diligence is required, and how the transaction is taxed. Deciding structure after making an emotional commitment to a property leads to worse outcomes.
About PARADYSE Homes
PARADYSE Homes is the ownership partner for Bali residential property, offering both Full Ownership and Co-Ownership as equally-weighted paths through one integrated team. The company combines buyer-first advisory, in-house legal structuring, end-to-end transaction management, and ongoing property management - so clients have a single accountable partner from the first conversation to the day rental income hits their account. PARADYSE monitors Indonesian property regulation continuously, ensuring every transaction is structured correctly under the current legal framework, including the PP 28/2025 updates and the Omnibus Law's investment provisions. With over 100 curated full-property listings, a growing portfolio of co-ownership villas across Bali's established residential areas, and institutional backing from Iterative.vc, PARADYSE brings structure and clarity to a market that has historically delivered neither.
Ready to understand how current regulations apply to your specific situation?
PARADYSE Homes will walk you through the right structure for your goals - before you commit to any property. Start the conversation at www.paradysehomes.com.
References
- Indonesia's omnibus law: A foreign investors' guide to the positive investment list | Vistra (www.vistra.com)
- New 2025 Rules for Foreigners Buying Property in Bali (PP 28) (balipropertyrules.com)
- Buying Property in Bali & Indonesia (2026): Guide for Foreign Buyers | Polarius (polariusrealestate.com)
