The Badung Regency Government has issued Badung Regent Regulation No. 60 of 2025 on the Imposition of Administrative Sanctions for Spatial Utilization in Badung Regency (“Perbup Badung 60/2025”).
The regulation introduces a clearer enforcement framework for spatial utilization that does not comply with applicable spatial planning requirements.
For investors, developers, property owners, and business owners in Badung, this is an important time to reassess whether the actual use of a property remains consistent with its approved spatial function and existing legal documentation.
What Constitutes a Violation?
Article 5 of Regulation 60/2025 identifies three main categories of spatial utilization violations:
1. Failure to comply with an established Spatial Plan resulting in a change of spatial function;
2. Failure to comply with spatial utilization provisions under the Spatial Plan; and
3. Obstruction of access to areas designated as public property under applicable laws and regulations.
Accordingly, spatial compliance should not be assessed solely by asking whether a property has obtained the relevant permits.
It is equally important to examine whether there is consistency between the permitted spatial function, the approvals held by the property, and the activities actually conducted on the property.
For example, a building may be legally approved for residential use, while in practice it is being operated as tourist accommodation or for another commercial purpose. Such circumstances may require further assessment against the specific spatial planning requirements and approvals applicable to the property.
Administrative Fines of Up to IDR 50 Million
Regulation 60/2025 provides for an administrative fine of up to IDR 50,000,000 for spatial utilization violations.
Importantly, payment of an administrative fine does not necessarily legalize the underlying non-compliant use.
Where the required restoration of the spatial function is not carried out, the regulation also provides for progressive fines based on the duration of the violation:
• 2–5 years: additional 2.75%
• 6–10 years: additional 5.5%
• 11–15 years: additional 8.25%
• 16–20 years: additional 11%
Assuming an administrative fine of IDR 50 million, the additional progressive fine would range from approximately IDR 1.375 million to IDR 5.5 million, depending on the relevant period.
The Exposure Goes Beyond Financial Penalties
More importantly, the legal exposure under Regulation 60/2025 is not limited to monetary fines.
The regulation provides for other administrative measures, including suspension of activities, closure of premises, revocation or cancellation of the Conformity of Spatial Utilization Activities (KKPR), demolition of buildings, and restoration of the spatial function.
Therefore, the key question for investors and business owners should not simply be:
“How much is the potential fine?”
The more important question is:
“Is the business activity currently being conducted consistent with the approved spatial function and the legal status of the property?”
A Timely Opportunity to Conduct a Legal Risk Assessment
With this enforcement framework now in place, this is an appropriate time for investors, property owners, developers, and business owners in Badung to engage their legal counsel and conduct a legal risk assessment of their existing properties and business operations.
Identifying potential non-compliance at an early stage allows business owners to understand their legal exposure and consider available corrective or regularization measures before the issue develops into an enforcement matter.
For investors, this assessment is also particularly relevant before an acquisition, lease, development, or business takeover, as existing spatial compliance issues may form part of the legal exposure associated with the investment.
This Legal Update is provided for general informational purposes only and does not constitute legal advice. The legal position of each property and business may differ depending on its location, spatial designation, approvals, building function, and actual use.
