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Is Bali being Conned by Condotels?

Bali Officials Say Most Condotels in Operating Illegally.

(6/21/2010) Radar Bali quoted the Head of Tourism for Badung, I Made Subawa, as saying there are "tens" of illegal Condotels operating without the required licenses and permits in his regency. Said Subawa: "There are around 30 or more condotels that are without operating licenses. This figure is based on the initial 'principal permits' issued for these project."

The principal permit is the initial permit to pursue an investment project. The Condotels in question are performing commercial operations without the sundry permits required under the law.

The Condotel mentioned by Radar Bali as lacking operational permits is the Bali Kuta Residence (BKR) on Jalan Majaphait which has been open for nearly an entire year. Reprimands and warnings have been issued by the Badung tourism office. A tourism official told the press that when BKR is asked for their operational permits, they freely admit that they are only in the process of organizing their trading license (SITU) and "free of local disturbance" (HO) permits, both of which should have been done before the building was constructed.

The management of the BKR fend off officials, claiming that those staying at the building are "only attending meetings." Such activities are nonetheless commercial in nature and, as such, violate the requirement to have completed the legalization process before commencing business. One Badung official warned: "If they do not soon complete their operational licenses, the operations of the BKR will be stopped.

Of the more than 30 condotels operating in Badung at this time, only 7 hold operational licenses.

The process to obtain an operating licenses for a new condotel is somewhat complicated. The process begins with obtaining a building permit (IMB). If the construction phase has reached 80% the owners are obliged to obtain a trading license (SITU) and a statement of "no disturbance" to the local environment/community (HO). Following this the zoning authority (Dinas Cipta Karya) must issue a building use permit.

In a separate report, members of the Badung House of Representatives (DPRD-Badung), are calling for the regency's enforcement agency (SATPOL PP) to close down all condotels found to be operating without the required licenses. Legislators are branding the local law enforcement procedures as being "toothless" in the face of the report of more than 30 illegally operating condotels in Bali.