Bali has recently become a hot spot for digital nomads. In case you were wondering what is a ‘digital nomad’. Basically it is someone who makes income online, without being tied to a physical location, like an office, or even a country. The internet has enabled a range of jobs to be done online, such as software development and graphic design.
Internet speed has held Bali back from becoming popular with digital nomads, but as fiber optic cable has become more widespread and wireless infrastructure greatly expanded, this is less of a problem. A number of co-working spaces have opened up which cater for digital nomads, such as Hubud in Ubud and Dojo in Canggu.
So while the internet may have caught up, what about the legal status of digital nomads in Bali, I hear you ask. As with many countries, there is no legal recognition of digital nomads in Indonesia. Indonesia has many different visa options available, but if you had to break them down, you would basically have two categories: short term tourist visas and permanent/semi-permanent stay options with more legal recognition.
Indonesia has very strict laws for foreigners who work in Indonesia. You need to be employed by a company registered in Indonesia and hold a work permit. You need to prove that a local cannot do the job in the company and be able to prove your education and experience for the job. Most digital nomads stay in a country for short periods of time, so this is usually not an option for them.
So if a digital nomad who has clients outside of Indonesia, makes all of their money outside of Indonesia, but works for those clients while they stay in Indonesia without a work permit, are they breaking the law? Strictly speaking, I think the answer is yes. However. We live in a fast paced world and even if someone takes a vacation, like in Bali, they are often required to reply to emails, answer phone calls etc. So, is this person breaking the law? I don’t believe so, as the main purpose of their trip is for tourism and immigration knows it would kill the tourism industry if a business person got arrested for writing a work related email while on holiday in Bali.
The main visa options for digital nomads are tourist, social budaya and business visas, all of which do not allow any kind of work whether it is paid or unpaid. I know of a few foreigners who have lived in Indonesia for many years on a social visa. You might get questioned as to how you support yourself if your passport starts filling up with tourist or social visa stamps. And immigration may suspect you are working illegally in Indonesia.
While a crackdown might happen at anytime, at least for now immigration seems to allow people to live on a pretty much permanent basis on social or business visas.
If you decide to live on a more permanent basis, you might wish to start a company (PMA). At least then you can conduct business, open a bank account, employ staff and work legally in Indonesia. (It does seem though that many banks will allow foreigners to open a bank account on a tourist visa with an introduction by an existing customer).
If you do decide to work as digital nomad in Bali, make sure to keep a low profile. Never offer your services like web design or photography to anyone locally. Work in a private space. Don’t tell anyone what you are actually doing online. If you get questioned by immigration and they ask how you make money, it is probably better just to say you are living from your savings/investments.
Immigration have been known for Google-ing people’s names – another reason to keep a low profile. There is also evidence that immigration is cracking down on foreigners renting rooms/villas on Airbnb, so that is also something best to avoid. Yoga practitioners, retreat operators and wedding planners all seem to be on the radar of immigration.
Now, I don’t mean to alarm anyone reading this article and most people coming to Indonesia won’t have a problem. But if you do run into some kind of trouble in Indonesia, like with another expat or local, you can be sure your visa status and source of income will be the first thing that comes under scrutiny.
If you don’t think immigration are serious, just Google the name Carmine Sciaudone. He was arrested for fixing a projector during a cruise party and spent over 9 months in jail, even though he was later cleared of any wrong doing.