Indonesia’s Ministry of Tourism has emphasized that the government has never banned nor planned to suspend the operations of Online Travel Agent (OTA) services, including platforms such as Airbnb, in Bali.
This clarification was issued in response to various media reports alleging a potential ban on OTA operations on the island. The government considers such information inaccurate and potentially misleading for the public and tourism industry stakeholders.
In its explanation, Ministry of Tourism reiterated that OTA platforms are regarded as strategic partners of the government in strengthening the national tourism ecosystem.
OTAs play a significant role in expanding market access, increasing accommodation occupancy rates, and supporting the global promotion of Indonesian tourism destinations.
Accordingly, the government’s approach is not aimed at restricting digital platforms, but rather at regulating business practices that do not comply with existing laws and regulations.
Data-Collection Guidance
Ministry of Tourism explained that the current policy focus is on organizing and regulating illegal tourism accommodations, namely accommodation units operating without the required business licenses for tourism accommodation services as mandated by applicable regulations.
This effort is deemed necessary to maintain service quality and ensure the safety and security of tourists.
“This arrangement is necessary to improve service quality, ensure tourist safety, and create fair business competition in the tourism sector,” Ministry of Tourism stated in a written release on Wednesday (10/12).
Since March 2025, the government has identified a significant number of unlicensed accommodation providers across several major tourism destinations, including Bali, the Special Region of Yogyakarta, West Nusa Tenggara, and West Java.
These findings prompted the government to undertake follow-up measures in the form of data collection, guidance, education, and supervision of all tourism accommodation business operators.
These efforts were further reinforced by the issuance of Circular Letter of the Minister of Tourism No. 4 of 2025 concerning the Appeal for Business Licensing Registration for Tourism Accommodation Operators, issued on 6 August 2025.
The circular encourages business actors to promptly complete their licensing requirements through the Online Single Submission (OSS) system as part of the risk-based licensing policy framework.
Within this regulatory framework, the government has also collaborated with various OTA platforms to ensure that all merchants listed on their platforms comply with applicable licensing requirements.
Not Merely Administrative
Following a Coordination Meeting with OTA representatives on 29 October 2025, the government issued an official letter dated 8 December 2025 requesting OTA platforms to direct their merchants to immediately register their business licenses through the OSS system.
Ministry of Tourism emphasized that business legality is not merely an administrative matter. Possession of a valid business license demonstrates that an accommodation provider meets standards of safety, professionalism, and fiscal compliance.
Moreover, licensed businesses contribute to Regional Original Revenue as well as central government tax revenues, making business licensing a crucial element of sound tourism governance.
As a concrete and measurable step, the government and OTA platforms have agreed on several joint initiatives, including the socialization of licensing obligations, the distribution of registration forms, and the establishment of a target requiring all accommodations marketed through OTA platforms to possess valid business licenses no later than 31 March 2026. Accommodations that fail to meet these requirements will be removed from OTA sales platforms.
In parallel, the government is also encouraging foreign OTA operators conducting business in Indonesia to register as domestic business entities, in accordance with Government Regulation No. 28 of 2025 on Risk-Based Business Licensing.
This regulation has been further implemented through Minister of Tourism Regulation No. 6 of 2025, which sets out standards for business activities, supervision mechanisms, and administrative sanctions within the tourism sector.
Previously, reports indicated that Bali was considering restrictions on accommodations affiliated with Airbnb Inc. as part of broader efforts to regulate tourism activities on the island amid record-high visitor numbers.
According to Bali Governor I Wayan Koster, the rapid proliferation of unregistered villas and guesthouses has undermined the government’s ability to increase revenue needed to finance public services. He also noted that the use of Airbnb-style rentals has surged in recent years, while hotel tax revenues have not increased proportionately despite a sharp rise in foreign tourist arrivals, as stated in his remarks to the Antara news agency.
Source : Bloomberg
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