Home Blog Opening A Restaurant in Bali: Why and How? Bali | Business Setup | Company Registration Opening A Restaurant in Bali: Why and How? InCorp Editorial Team 16 May 2019 4 minutes reading time Table of Contents Dining Scene in Bali Requirements for Setting Up a Restaurant Business in Bali Legal Entities for Restaurant Business in Bali Licenses Required for Restaurant Business How Cekindo Can Help Despite the hard work that a foreigner has to put into for running any kind of business, opening a restaurant business in Bali may be one of the most rewarding experiences of your life. Setting up a restaurant business in Bali fuses two of every foreign investor’s greatest desires: making a steady profit while living in paradise. Apart from that, due to the growing tourism and increasing consumer spending in this country with a population of over 260 millions, both residents in Bali and tourists have also grown to appreciate the local and international cuisine the island offers. The tremendous support from the Indonesian Investment Board and Tourism Board has also made Bali become the new dining destination of the world. Therefore, it is pretty clear that opening a restaurant in Bali, if done right, is a sure-shot path to success. If you still don’t know how to go about it, or are in the midst of setting up your first restaurant in Bali, then you are in the right place. This article tells you, in detail, why and how you should start a restaurant business in Bali. Dining Scene in Bali The number of international and local restaurants that has sprung up in Bali over the years has transformed this beautiful island into a lucrative paradise for more than just another popular holiday destination. According to McKinsey Global Institute, there will be about 135 million people that belong to the consuming class of the country by 2030. Therefore, people in this consuming class will constantly look for entertainment and dining experience in restaurants with the additional income. The tourism sector, including restaurants, contributed to the country’s GDP of 14.6% in 2014, with an amount of IDR 1473 trillion. Requirements for Setting Up a Restaurant Business in Bali Restaurant businesses are considered a part of the tourism business in Bali. Therefore, foreign investors can refer to Ministerial Regulation of Ministry Culture and Tourism No. PM. 87 /HK.501/MKP/2010. To own and start a restaurant in Bali, it is mandatory to establish a restaurant with physical space that can hold up to more than 60 seats. In addition, the location of your restaurant must belong to zones that are adequate for commercial activities. Necessary permits are required as well, which will be discussed in the following sections. Legal Entities for Restaurant Business in Bali First of all, as a business owner of a restaurant in Bali, you will need to know your options of registering a legal business entity on the island. For foreigners, there are two common types of legal entity available in Bali for restaurant business: a local company (PT) and a foreign-owned company (PT PMA). A PT company has to be 100% owned by an Indonesian national. So if you are a foreign investor who wishes to own a business or to expand your business in Bali, this type of formation may not be suitable for you. Alternatively, you can opt for a PT PMA. Fortunately, under the current Negative Investment List (NIL), foreigners are allowed to have 100% ownership of the PT PMA in the restaurant sector. The permission of 100% foreign ownership is a part of the Indonesian government’s effort to attract even more foreign investment in this burgeoning sector. However, one thing for foreigners to take note is that a small-scale eatery, also known as “Rumah Makan” in Indonesian, can only be formed under a PT owned by Indonesians. Licenses Required for Restaurant Business The permits and licenses required for this sector are listed in the following: Tanda Daftar Usaha Pariwisata (TDUP) (or restaurant license) with a general validity of 5 years, depending on the area in Bali Tourism operational license Health and hygiene license Building permit (IMB) NPPKBC and/or SIUP-MB if you sell and/or produce alcohol Intellectual property licenses if you play pre-recorded music or have live music Required Documents for Restaurant License Complete application form Copy of ID/Passport Copy of company NPWP Copy of Company Article of Association Copy of IMB permit Copy of Environmental Impact Analysis AMDAL Pictures in color of business location The cost of a restaurant license starts from IDR 120 million. The entire process of company formation and license issuance will take up to 2-3 months. How Cekindo Can Help Preparing all the documents and reading through all the rules and regulations related to opening a restaurant in Bali as well as business and restaurant licenses may appear to be time consuming and energy draining. That is why Cekindo is here to assist you in starting a business in Bali. Get in touch with us today. We also have offices in Jakarta and Semarang. Read Full Bio Verified by David Susandi Branch Manager – Bali Office at InCorp Indonesia Holding 11 years of experience in various roles, including project manager, operational manager, and corporate strategist, David Susandi is a prominent figure for many entrepreneurial organizations expanding in Indonesia. Frequently Asked Questions Is having audited accounts mandatory? Audited financial statements are required for: Entities gathering funds from the public (e.g., banks, insurance companies) Entities issuing debt instruments Publicly listed companies State-owned enterprises Companies with assets and/or turnover exceeding IDR 50 billion Entities mandated by legislation What requirements are needed if my Indonesian company registers the product? Register the product with BPOM (National Agency of Food and Drugs) and MoH (Ministry of Health). The type of testing and document requirements depend on the type of product you want to register. Also, the time frame for registration could vary between 3 to 15 months. How A PMA company can be eligible to conduct import activities? What licenses and procedures are necessary while engaging in import-related activities? A PMA company in Indonesia must obtain an NIB, which also functions as: Importer Identification Number (Angka Pengenal Impor or API) Producer Importer Identification Number (Angka Pengenal Impor Produsen or API-P), which is required for the import of machinery and equipment, goods, and materials used in production. General Importer Identification Number (Angka Pengenal Impor Umum or API-U), which is required for the import of specific goods for trading purposes, is grouped under one section in the Customs Classification System. Customs Identification Number (Nomor Identitas Kepabeanan or NIK), It functions as an identifying document for the applicable Customs and Excise authorities during the customs clearance process. Some goods may face limitations or restrictions on importation in Indonesia, potentially requiring additional approval from the Ministry of Trade. Recommendations from technical ministries like Industry or Agriculture may influence these approvals. Can you have a nominee arrangement when setting up PMA? A nominee arrangement is an arrangement that uses another person’s name as a subject. In Indonesia, it is prohibited. This restriction aims to prevent situations where a company is owned by one party but beneficially owned by another. According to the law, any nominee agreement between a local party and a foreign investor is deemed null and void. Get in touch with us. 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