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Cabinet Approves Draft Bills Expanding Thai Labor Court Jurisdiction to Criminal Cases, Excluding Human Trafficking

On August 25, 2026, the Cabinet of Thailand (the “Cabinet“) has approved two draft acts, reviewed by the Office of the Council of State and proposed by the Office of the Judiciary:

  1. The Draft Act on the Establishment of Labor Courts and Labor Court Procedure (No. ..), B.E. …. (the “Draft Labor Court Act“); and
  2. The Draft Human Trafficking Procedure Act (No. ..), B.E. …. (the “Draft Human Trafficking Act“).

Background

  • Criminal liability under labor law has distinct characteristics that differ from general criminal liability under the Criminal Code or other statutes. At present, however, the Labor Court’s jurisdiction is limited to labor disputes and does not extend to criminal cases arising under labor-related laws. This limitation is inconsistent with the fundamental principle underlying labor adjudication—namely, that such cases should be heard by judges with specialized knowledge, expertise, and genuine understanding of labor issues.
  • Under the current system, the civil aspects of a labor case are heard in the Labor Court while the related criminal aspects are heard in other Courts of Justice. This bifurcated process results in the following:
    • It increases the burden on litigants, who must pursue proceedings in two separate courts;
    • It requires judges and litigants to spend additional time re-examining evidence for the criminal proceedings, even though most of the relevant facts already appear in the Labor Court case file; and
    • It creates a risk that judicial discretion in sentencing for criminal labor cases will vary from court to court.
  • The Draft Human Trafficking Act expressly excludes human trafficking cases from the jurisdiction of the Labor Court, even where such cases involve elements of forced labor or services. Because human trafficking offenses are severe, carry substantial penalties, and may be connected to other criminal offenses, the Human Trafficking Procedure Act, B.E. 2559 (2016), is being amended concurrently with the Draft Labor Court Act to prohibit the Labor Court from accepting cases involving charges under the law on the prevention and suppression of human trafficking.

Key Changes

1. Draft Labor Court Act

The Draft Labor Court Act amends the Act on the Establishment of the Labor Court and Labor Procedure, B.E. 2522 (1979), to expand the Labor Court’s jurisdiction to include criminal labor cases. Previously, the Labor Court’s jurisdiction covered labor cases only, expressly excluding criminal matters. The key changes are as follows:

1.1 Expanded criminal jurisdiction The Labor Court will have jurisdiction to try and adjudicate criminal cases involving offenses under the following labor-related laws:

  • The law on homeworkers’ protection;
  • The law on labor protection;
  • The law on labor protection in sea fishery work;
  • The law on employment and job-seeker protection;
  • The law on the management of foreign workers’ employment;
  • The law on social security;
  • The law on occupational safety, health, and working environment;
  • The law on workmen’s compensation;
  • The law on maritime labor;
  • The law on state enterprise labor relations;
  • The law on labor relations; and
  • Other laws as prescribed by Royal Decree.

Cases falling within the jurisdiction of the Juvenile and Family Court remain excluded from the jurisdiction of the Labor Court.

1.2 Joinder of offenses Where a single act constitutes multiple offenses and at least one falls within the Labor Court’s jurisdiction, the Labor Court has authority to try and adjudicate the related offenses as well. Where multiple interconnected acts are involved, the Labor Court may either adjudicate them jointly or transfer the case to a competent court, having primary regard to convenience and the interests of justice.

1.3 Applicable procedure For criminal proceedings before the Labor Court, the Draft Labor Court Act provides that the Criminal Procedure Code, or the law on the establishment of Magistrate Courts and criminal procedure therein, shall apply, as applicable. The Criminal Procedure Code shall likewise apply to proceedings at both the appellate and Supreme Court levels.

1.4 Procedural rule-making authority The Chief Judge of the Central Labor Court has the authority to issue procedural regulations governing criminal proceedings, subject to the approval of the President of the Supreme Court. Such regulations must not conflict with the Criminal Procedure Code or diminish a defendant’s right to a defense below the standard prescribed by law. Where necessary, the Labor Court may also appoint another court of first instance to carry out procedural acts on its behalf, excluding the final adjudication of the dispute.

1.5 Composition of the bench The composition of the judicial panel authorized to try criminal cases shall conform to the law on the Organization of the Courts of Justice.

1.6 Transitional provision Criminal cases pending before the effective date of the Draft Labor Court Act shall remain under the jurisdiction of the original court until final judgment.

2. Draft Human Trafficking Act

The Draft Human Trafficking Act amends the Human Trafficking Procedure Act, B.E. 2559 (2016). Under the current law, the Intellectual Property and International Trade Court and the Central Bankruptcy Court are prohibited from accepting cases involving charges under the law on the prevention and suppression of human trafficking. The Draft Human Trafficking Act adds the Labor Court to this list, thereby also prohibiting the Labor Court from accepting such cases.

Key Takeaways

  • The principal objective of this legislative reform is to allow criminal cases arising under labor law to be brought directly before courts with specialized expertise in labor matters. Under the current framework, the civil and criminal aspects of a labor dispute must be handled separately in different courts. This reform is intended to promote greater continuity in the assessment of the underlying facts and the nuances of the employment relationship, while reducing the procedural burden on litigants.
  • At the same time, these amendments prohibit the Labor Court from hearing human trafficking cases—even those involving forced labor—thereby keeping these high-severity offenses within the jurisdiction of the general criminal courts.

Author: Panisa Suwanmatajarn, Managing Partner.

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Digital Platform Fees: New Guidance on Transparency and Fairness

Thailand’s regulation of digital platform services is continuing to develop beyond basic registration and disclosure obligations. The Electronic Transactions Development Agency (ETDA) has issued a new guideline addressing transparency and fairness in the fees charged by digital platform service providers. The guideline is intended to address growing concerns surrounding unpredictable fee structures, hidden costs, frequent changes to charges, and contractual arrangements that make it difficult for businesses using platforms to determine their actual cost of doing business.

The guideline does not impose a statutory cap on platform fees or prescribe particular prices. Instead, it establishes a best-practice framework under which platform operators are encouraged to make their fee structures transparent, understandable, predictable, and fair. Although the guideline is voluntary in nature, it provides an important indication of the regulatory standards that ETDA considers appropriate for the digital platform sector and should therefore be considered when platform operators design or review their terms and conditions and commercial arrangements.

Transparency of Platform Fees:

A central principle of the guideline is that users should be able to understand the total financial burden associated with using a platform.

Platform operators are encouraged to present fee information in a centralized and readily accessible location rather than requiring users to search through multiple pages, policies, or contractual documents. Information should clearly identify the different categories of fees, explain what each fee represents and what service or benefit the user receives in return, and provide sufficient information regarding the basis for calculating the fee.

Where a fee is calculated according to a formula or percentage, practical examples should be provided where appropriate so that users can reasonably estimate the amount they will be required to pay.

This approach is particularly relevant to platforms where the overall cost imposed on merchants or service providers consists of several components. Depending on the business model, these may include commissions, transaction charges, payment-processing fees, advertising expenses, promotional program charges, affiliate fees, logistics charges, or charges for additional platform services.

The regulatory concern is therefore not limited to the headline commission rate. A fee structure may create transparency concerns where individual charges appear understandable in isolation but users cannot readily determine their aggregate cost.

Changes to Fees Should Be Predictable:

The guideline also addresses changes to platform fees. ETDA recommends that platform operators provide users with advance notice of changes, with the guideline contemplating at least 15 days’ prior notice.

This principle is significant for merchants and other business users because frequent or unexpected changes to fees may affect their ability to calculate margins, determine prices, or decide whether continued participation on a platform remains commercially viable.

From a compliance perspective, platform operators should therefore consider establishing an internal change-management process for fee adjustments. Before introducing or increasing a fee, operators should identify the affected users, prepare an understandable explanation of the change, determine how and when notice will be delivered, and maintain appropriate records showing that the required communication has taken place.

The issue should also be considered together with the existing regulatory framework governing changes to the terms and conditions of digital platform services. Fee changes should not be treated merely as an accounting matter where they effectively alter the commercial terms governing the relationship between the platform and its users.

Fairness Is More Than Disclosure:

Transparency alone does not necessarily make a fee fair. The guideline therefore establishes a separate fairness principle.

Among other things, platform operators are encouraged to avoid duplicative charges and to ensure that fees have a reasonable relationship with the relevant costs or value provided. Users should generally not be compelled to purchase ancillary services merely as a practical condition of obtaining the core platform service.

Additional fees should similarly correspond to genuine additional value or services received by users rather than operating as unavoidable charges presented as optional services.

These principles are particularly relevant to platform ecosystems in which merchants may technically be free not to purchase advertising, participate in promotions, use affiliate programs, or acquire other supplementary services, but where the commercial architecture of the platform could make participation practically necessary to remain visible or competitive.

Accordingly, platform operators reviewing compliance should consider the economic substance of their fee arrangements rather than relying exclusively on how a charge is described in the contract.

Relationship With Competition Law:

The guideline also has an important competition-law dimension. In ETDA’s discussion of the new framework, the Trade Competition Commission of Thailand emphasized that regulatory scrutiny is not simply concerned with whether a fee is “high” or “low.” Relevant concerns can include whether the pricing structure is reasonable and transparent and whether the operator can explain the basis on which particular fees are determined.

Competition concerns may potentially arise in circumstances involving excessive charges, predatory pricing, or coordinated or parallel pricing behavior unsupported by legitimate cost considerations.

The regulatory approach therefore appears to favor transparency and market discipline rather than direct government determination of platform prices. This distinction is important: the objective of the guideline is not to establish a uniform fee structure across platforms, whose business models and cost structures may differ substantially, but to encourage operators to be able to explain and justify how their charges operate.

What Platform Operators Should Review:

The guideline provides a useful opportunity for platform operators to conduct a broader review of their commercial arrangements with users. In particular, operators should consider whether users can easily identify every material fee applicable to them; whether the purpose and calculation method of each fee are adequately explained; whether optional services are genuinely optional in practice; whether fees for similar services overlap; and whether procedures exist for providing adequate advance notice of fee changes.

Operators should also consider whether their internal records provide a reasonable explanation for the commercial basis of material fees. This may become increasingly important where complaints regarding platform charges raise issues not only under the digital platform regulatory framework but also under consumer-protection or competition laws.

For businesses operating multiple digital services, fee governance may therefore merit treatment as a compliance function rather than simply a commercial pricing decision.

A Broader Direction in Platform Regulation:

The new guideline should also be viewed in the broader context of Thailand’s regulatory framework for digital platform services. The Royal Decree on the Operation of Digital Platform Service Businesses Subject to Prior Notification already establishes obligations intended to improve transparency and fairness in platform operations.

ETDA’s increasing use of detailed guidelines and sector-specific measures indicates a movement toward more substantive expectations concerning how platforms interact with users, rather than regulation being confined to notification requirements.

The fee guideline is formally framed as best practice. Nevertheless, voluntary regulatory guidance can influence market expectations, contractual practices, complaint handling, and the way regulators assess whether platform conduct is transparent and fair. Platform operators should therefore consider the guideline when drafting new fee structures and when reviewing existing terms and conditions.

Key Takeaways:

  • ETDA has introduced a best-practice framework for transparency and fairness in digital platform fees rather than imposing price controls or statutory fee caps.
  • Platform operators are encouraged to consolidate fee information, explain the purpose and calculation of charges, and enable users to understand their overall cost of using the platform.
  • Changes to fees should be communicated in advance, with the guideline recommending at least 15 days’ notice.
  • Fairness requires more than disclosure: duplicative charges, compulsory ancillary services, and fees that do not reasonably correspond to costs or value may raise concerns.
  • Platform fee structures may also have implications under competition and consumer-protection laws.
  • Even though the guideline operates as voluntary guidance, platform operators should consider incorporating its principles into their terms and conditions, pricing governance, and compliance procedures.

Author: Panisa Suwanmatajarn, Managing Partner.

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ETDA: Proposed Overhaul of Thailand’s Electronic Transactions Act – Modernizing for the Digital Economy

Thailand’s existing Electronic Transactions Act B.E. 2544 (2001, as amended) has served as the foundational legal framework for electronic transactions for over two decades. Enacted in an earlier era of digital adoption, it primarily addressed basic electronic signatures, data messages, and recognition of electronic records. However, it increasingly struggles to accommodate rapid technological advancements, including automated contracting systems, electronic transferable instruments (such as e-bills of lading), cloud-based data storage, digital identity solutions, and complex cross-border digital platforms.

Limitations in the current law—such as uncertainty around the reliability and evidentiary weight of electronic data, rigid requirements that do not flexibly support emerging technologies without additional regulations, and enforcement gaps—hinder full digital transformation. This creates friction for businesses adopting paperless processes, e-commerce, fintech, logistics, and other innovative models central to Thailand 4.0 and the broader digital economy.

Many jurisdictions have proactively updated their frameworks to address these challenges. The United Nations Commission on International Trade Law (UNCITRAL) Model Laws on Electronic Commerce, Electronic Signatures, and Electronic Transferable Records have influenced reforms worldwide. Countries like Singapore, the EU (with eIDAS and related directives), and others have introduced technology-neutral rules, enhanced trust services, liability frameworks for service providers, and specific provisions for electronic equivalents of negotiable instruments. These updates boost legal certainty, reduce compliance burdens, facilitate international trade, and stimulate innovation while maintaining consumer and business protections.

Key Changes in the Draft Act and UNCITRAL Alignment:

The Electronic Transactions Development Agency (ETDA) has proposed a comprehensive Draft Electronic Transactions Act for public hearing (comments due by June 15, 2026). The draft represents a substantial rewrite rather than a simple amendment. It shifts Thailand toward a more technology-neutral, principles-based, and trust-oriented framework, building on the original law’s foundations while incorporating newer UNCITRAL instruments.

Major Changes from the Current Law:

Broader Legal Recognition of Electronic Data and Transactions: Electronic records that are accessible, reusable, and retain integrity will satisfy requirements for “writing,” originals, retention, and evidence across civil, criminal, and procedural contexts. Electronic transactions become the default/preferred mode. This significantly expands functional equivalence beyond the 2001 Act’s more limited scope.

Electronic Signatures, Seals, Timestamps, and Notices: Reliable electronic methods (or ETDA-prescribed ones) fulfill signature, seal, timestamp, and registered mail requirements. Public announcements can shift to verified online platforms. New emphasis on electronic seals and reliable timestamps strengthens evidentiary value.

Reliable Methods, Certification, and Burden of Proof: Introduction of “reliable electronic methods” with ETDA recognition/certification. When approved systems are used, the burden and cost of disproving reliability shift to the challenger. This provides stronger legal certainty and incentivizes certified solutions.

Automated and Electronic Contracting: Explicit validation of contracts formed by automated systems (with or without human intervention), plus detailed rules on attribution, receipt acknowledgment, timing/place of dispatch, input error correction, and verification methods.

New Regime for Electronic Transferable Instruments: A dedicated framework for e-bills of lading, warehouse receipts, promissory notes, etc., including exclusive control (equivalent to possession), transfer, endorsement, amendment, integrity, and paper-electronic conversion. This is a major addition.

Regulation of Service Providers: Broader coverage of identity proofing, e-signatures, timestamping, data storage, and related services. Replaces rigid licensing with a voluntary certification (“trust mark”) scheme, risk management, cybersecurity, and complaint-handling obligations. Liability protections for compliant providers, with transitional recognition for existing licensees.

Strong UNCITRAL Alignment:

Builds on the original Act’s foundation in the Model Law on Electronic Commerce (1996) and Electronic Signatures (2001).

Incorporates the Electronic Communications Convention (ECC, 2005) — Thailand acceded in 2025 — for automated contracting and international rules.

Adopts principles from the Model Law on Electronic Transferable Records (MLETR, 2017) for e-transferable instruments.

Aligns with the Model Law on Electronic Identity and Trust Services (MLIT, 2022) through trust services, certification, and technology-neutral identity frameworks.

Supports overall technology neutrality and functional equivalence, enhancing interoperability under initiatives like the Framework Agreement on Cross-border Paperless Trade (CPTA).

Business Impacts and Preparation Steps:

The Draft Act would lower barriers to digital operations, reduce paper dependency, streamline contracting and record-keeping, and improve cross-border compatibility. Sectors like trade finance, logistics, e-commerce, fintech, cloud services, and digital identity providers stand to benefit significantly.

New compliance expectations include system reliability, risk management, cybersecurity, audits, and vendor due diligence. Businesses may need to update processes, contracts, policies, and user interfaces.

Businesses should prepare by:

Reviewing current electronic systems against emerging “reliable method” standards.

Assessing exposure as service providers or users.

Monitoring ETDA subordinate regulations, certifications, and guidance.

Updating contracts, terms, privacy notices, and record-retention policies.

Enhancing cyber security and complaint-handling mechanisms.

Current Status and Next Steps:

The Draft Act is currently in the public hearing phase (comments due by June 15, 2026). Following consultation, it will undergo refinement, Cabinet approval, parliamentary review, and publication in the Government Gazette.

Implementation is not immediate: The law would generally take effect 180 days after Gazette publication, with ETDA issuing subordinate rules, standards, and certification procedures (targeted within 180 days post-publication, though effective timelines may extend). Full industry adaptation and technical rollout could span months to years. Existing providers receive transitional support.

Key Takeaways:

The Draft Act modernizes Thailand’s electronic transactions framework through broader recognition, new instruments for digital trade, and a flexible certification model — strongly aligned with evolving UNCITRAL standards.

It addresses longstanding limitations while promoting trust, innovation, and paperless processes across private and public sectors.

Businesses should proactively assess impacts, strengthen systems, and participate in the ongoing public consultation.

Successful implementation will enhance Thailand’s digital economy competitiveness, though it requires coordinated regulatory and industry efforts over the coming years.

Author: Panisa Suwanmatajarn, Managing Partner.

Source: International Business August 2026 : Antea

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Cabinet Approves Four Draft Bills Modernizing Thailand’s Capital Market Legislation

Introduction

The Cabinet has approved four draft bills proposed by the Ministry of Finance (“MOF”) and reviewed by the Office of the Council of State (“OCS”), pursuant to the Cabinet resolution of 14 February 2023 (B.E. 2566). The bills amend:

  • the Securities and Exchange Act B.E. 2535 (1992) (“SEA”);
  • the Derivatives Act B.E. 2546 (2003) (“DA”);
  • the Trust for Transactions in Capital Market Act B.E. 2550 (2007) (“TTA”); and
  • the Emergency Decree on Digital Asset Businesses B.E. 2561 (2018) (“DAB”).

The case for reform is that provisions across all four instruments have fallen out of step with current market conditions, do not adequately accommodate rapid technological change, are inconsistent with one another on matters of shared subject matter, and in places lack the clarity needed for consistent interpretation.

Together, the draft bills address six areas:

  • Promotion of the digital capital market;
  • Supervision of business operators;
  • Supervision of the secondary market and related organizations;
  • Fundraising and the supervision of audit firms and capital market service providers;
  • Enforcement and penalties; and
  • The supervisory structure.

Two bodies are principally involved in the reforms: the Securities and Exchange Commission (“SEC”), which has the power and duty to set policy for the promotion and development of the Thai capital market, and the Office of the Securities and Exchange Commission (“SEC Office”), which implements that policy on the SEC’s behalf. The amendments under each of the four draft bills are summarized below.

1. The Draft Securities and Exchange Act (No. ..) B.E. .… (“Draft SEA”)

1.1 Capital market promotion

a. Preparing, sending, receiving, and storing information and documents, and advertising, disclosing, or distributing them, by electronic means will be expressly lawful. The SEA currently contains no such provision, although the practice is already well established.

b. A prospectus may be published through means other than printing, which is currently the only channel the SEA recognizes.

c. Where certificated securities are pledged as collateral, enforcement will be available through means outside the Thai Civil and Commercial Code. Where the instrument has a stated maturity and the debt has fallen due, the pledgee may collect on the due date without prior notice.

1.2 Supervision of securities companies

a. Major shareholder approval requirements move into the Draft SEA. A person holding, or benefiting from, shares carrying more than 10 percent of total voting rights must obtain SEC Office approval. This requirement currently sits in subordinate legislation.

b. The Minister of Finance may impose conditions requiring a securities company whose license has been revoked to take steps to protect investors’ interests.

c. Securities companies must prepare financial statements for both six-month and twelve-month periods, audited and opined on by an auditor, in the form the SEC Office prescribes. Under the current SEA, only six-month statements are required.

d. Supervision of auditors and audit firms, financial advisers, property valuers, credit rating agencies, offshore service providers, securities business personnel, and other service providers will be set out in the Draft SEA itself rather than in subordinate instruments, raising the standard applied to capital market personnel.

1.3 Trading venues and the secondary market

a. Securities trading centers are classified into two categories: licensed centers, open to general investors, and registered centers, open only to institutional investors, with the level of supervision depending on the degree of investor protection required.

b. Ownership of deposited securities is clarified. A depositor must maintain a list of the owners of securities deposited with the Stock Exchange of Thailand (SET), and a person named on that list is deemed the owner entitled to the securities of the class, type, and quantity recorded. The current SEA leaves the position of depositors’ clients unclear.

c. Associations connected with the securities business may invest their funds or income in debt instruments or other securities prescribed by the SEC, subject to SEC Office supervision, giving them an additional income channel.

1.4 Auditors, service providers, and critical systems

a. Financial reports must be audited by auditors and audit firms approved by the SEC Office, and capital market service providers must obtain SEC Office approval.

b. Significant system providers to the capital market become subject to supervision, including a requirement to hold sufficient funding to support their operations and associated risks.

c. Control over management and continuity is strengthened. Such a provider may appoint a director or manager, or contract out all or part of its management authority, only with SEC Office approval. The SEC may restrain conduct capable of causing serious damage to the public interest and may address the cessation of the provider’s business.

1.5 Enforcement and penalties

a. SEC Office officials will be able to conduct investigations alongside inquiry officials and special case inquiry officials in categories of offence that may seriously damage confidence in the capital market or affect the national economy.

b. Criminal penalties and administrative fines will be revised, with criminal liability retained only for serious offences or those contrary to good morals.

1.6 The supervisory structure

a. The Secretary-General of the Office of Insurance Commission joins the SEC as an ex officio member.

b. The Minister of Finance, the SEC, and the SEC Office each gain the power to reduce or waive fees for registration and capital market services.

c. The affairs of the SEC Office are placed outside social security legislation, aligning its position with that of other regulators such as the Bank of Thailand (BOT).

2. The Draft Derivatives Act (No. ..) B.E. .… (“Draft DA”)

2.1 Capital market promotion

a. See Section 1.1(a) above.

2.2 Supervision of securities companies

a. See Section 1.2(a) above.

b. The scope and characteristics of persons acting as investment consultants, investment analysts, investment planners, derivatives investment managers, or other functions notified by the Capital Market Supervisory Board (“CMSB”) will be prescribed. Such matters were previously prescribed in subordinate legislation.

c. Provisions will be introduced on the supervision of major shareholders, directors, and persons with management authority of a derivatives exchange. A person may hold shares in, or benefit from shares of, a derivatives exchange in excess of the threshold notified by the SEC only upon obtaining SEC Office approval, in accordance with criteria, conditions, and procedures notified by the SEC. Under the current DA, shareholding is capped at 5 percent.

2.3 Auditors, service providers, and critical systems

a. Derivatives business operators — other than derivatives advisors who are natural persons (a category not previously specified) — will be required to prepare accounts showing the results of their operations and their financial position as these actually stand, in accordance with professional accounting standards under the law on accounting professions and any additional requirements notified by the SEC.

b. Derivatives business operators will be required to prepare financial statements and submit them to the SEC Office, audited and opined on by a certified public accountant in accordance with criteria notified by the SEC and approved by the SEC Office.

2.4 Enforcement and penalties

a. See Section 1.5(a) above.

b. Administrative penalties will be prescribed for a derivatives exchange that contravenes or fails to comply with criteria, orders, or conditions prescribed by law.

2.5 The supervisory structure

a. Additional powers and duties are conferred on the SEC and the SEC Office to reduce or waive fees for applications for a license, registration, or approval; for the issuance of a license, acceptance of a registration, or grant of an approval; or for carrying on a licensed, registered, or approved business, in accordance with notified criteria and conditions.

3. The Draft Trust for Transactions in Capital Market Act (No. ..) B.E. .… (“Draft TTA”)

3.1 Capital market promotion

a. See Section 1.1(a) above.

3.2 Supervision of securities companies

a. Additional powers and duties are conferred on the SEC to reduce or waive fees for applications for permission, the granting of permission, or the carrying on of business under the Draft TTA, in accordance with notified criteria and conditions.

b. Regulations, rules, notifications, orders, or requirements issued under the Draft TTA by the CMSB and having general application will take effect upon publication in the Government Gazette, whereas the current TTA applies this requirement only to instruments issued by the SEC Board and the SEC Office.

4. The Draft Emergency Decree on Digital Asset Businesses (No. ..) B.E. …. (“Draft DAB”)

4.1 Capital market promotion

a. See Section 1.1(a) above.

4.2 Enforcement and penalties

a. See Section 1.5(a) above.

4.3 The supervisory structure

a. See Section 1.6(b) above.

Legal Basis and Objectives

The four draft bills are brought forward under Section 77 of the Constitution of the Kingdom of Thailand, which provides that the State should, without delay, revise laws that are no longer suited to prevailing circumstances or that obstruct the pursuit of an occupation, so that they do not burden the people.

Beyond this constitutional duty, the stated objectives are to accommodate the use of appropriate technology in capital market transactions, to create clarity in supervision, to improve enforcement in line with international regulatory standards, to remove duplicative processes, to advance State policy and capital market plans, and to raise the level of investor protection.

Consultation and Impact Assessment

The OCS and the SEC Office consulted state agencies, the private sector, and the public on all four draft bills, through both online submissions and focus group sessions. An impact analysis was prepared in accordance with the Cabinet resolution of 19 November 2019 (B.E. 2562), and both the consultation results and the analysis have been published online.

The MOF has also submitted a plan for the subordinate legislation to be issued under the four draft bills, including the intended timeframe and a framework of key content. That subordinate legislation comprises 183 instruments.

Key Takeaways

  • The Draft SEA, DA, TTA, and DAB have cleared Cabinet and Council of State review and now proceed through the parliamentary process.
  • The most immediate practical change is the statutory recognition of electronic documents and non-print advertising, which brings the SEA into line with existing market practice.
  • Several matters move from subordinate legislation into the acts themselves, notably approval of major shareholders in securities companies and supervision of capital market service providers.
  • Two newly regulated categories of person are introduced: capital market service providers (including auditors, financial advisers, and valuers) and significant system providers to the capital market.
  • Enforcement is strengthened through joint investigation powers, while criminal liability is narrowed to serious offences, with other conduct shifting to civil administrative fines.
  • The MOF has flagged 183 subordinate instruments to be issued under the four draft bills, meaning enactment will mark the start rather than the end of the reform process.
  • Affected businesses should assess now whether they fall within the newly regulated categories, since approval requirements, funding thresholds, and management appointment controls will apply once the draft bills are enacted.

Author: Panisa Suwanmatajarn, Managing Partner.

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Legal Update: Thailand Named in the White House Transshipment Report — Legal Exposure and the Government’s Response

Introduction

On 13 August 2026, the White House Office of Trade and Manufacturing Policy published a report entitled The Great Transshipment Scam (the “Report”). The Report identifies more than 40 jurisdictions said to present elevated risk of illegal transshipment of Chinese-origin goods into the United States and places Thailand in the second of three risk tiers.

The Thai Government responded within days, on 15 August 2026, confirmed that technical tariff negotiations with the United States would proceed at the end of August, and on 17 August 2026, the Department of Foreign Trade (“DFT”), Ministry of Commerce (“MOC”), set out the measures Thailand has taken on origin verification and its position on the underlying analysis.

The Report is not a legal instrument: it imposes no duty and creates no liability. Nonetheless, it consolidates a documented U.S. Government position that will inform enforcement targeting, trade remedy proceedings, and the negotiation of an Agreement on Reciprocal Trade (“ART”).

Thailand’s Classification under the Report

The Report groups the identified jurisdictions into three tiers. The first comprises diversified economies with large volumes of China-linked goods and comparatively strong customs systems, including Canada, the European Union, India, Israel, Japan, Mexico, South Korea, and Taiwan. The third comprises smaller economies said to offer specific weak-link advantages, such as low-cost labor, permissive free zones, or limited customs capacity.

Thailand is placed in the second tier, described as economies combining significant transshipment volumes with deep integration into China-linked supply chains, alongside Brazil, Indonesia, Malaysia, Turkey, and Vietnam. The Report characterizes Thailand, Vietnam, Malaysia, and Indonesia as major platforms for electronics, machinery, plastics, footwear, apparel, and components incorporating Chinese-origin inputs.

Thailand is named specifically in two contexts, and the two carry different legal weight.

The first is the Report’s “ugly sister city” analysis, which pairs foreign industrial corridors with U.S. regions producing the same goods, on the premise that work gained in one is work lost in the other. Thailand’s entry pairs the Ayutthaya–Samut Prakan corridor — linked to thermostats under HS 903210 — with the Minneapolis–St. Paul instruments sector. This is an inference drawn from trade statistics rather than a finding against any specific company, and the Report itself describes the pairings as illustrative. It nonetheless signals to U.S. Customs and Border Protection (“CBP”) which product code and geographic area warrant closer scrutiny.

The second reference concerns a decided case. The Report cites circumvention findings on solar cells and modules, in which the U.S. Department of Commerce determined that duties on Chinese goods were being evaded through final processing in Cambodia, Malaysia, Thailand, and Vietnam. Thailand therefore already has an enforcement record on this issue.

Thailand’s Response

According to MOC figures cited on 15 August 2026, approximately 72 percent of Thai product lines under Section 301 and Section 232 measures are already exempt, leaving roughly 28 percent still subject to the additional tariff. The exemptions span eight industry groups:

  • Electronic equipment and electrical machinery;
  • Machinery and components;
  • Iron and steel;
  • Articles of iron or steel;
  • Plastics and plastic products;
  • Vehicles and components;
  • Copper and copper products; and
  • Measuring, medical, and optical instruments.

Four of these groups fall under Section 232. As explained below, their inclusion reflects a distinction: goods in those categories are excluded from Section 301 to prevent double charging, rather than relieved of duty altogether.

Thailand is responding on three fronts.

Origin verification: The DFT has reported that the watch list operated jointly with CBP has been expanded from 49 items covering 194 tariff lines to 67 items covering 274 tariff lines, effective 1 June 2026. The DFT is developing an AI-assisted origin risk assessment system, has trained more than 2,000 operators on rules of origin and local content requirements, and has increased factory inspections, retrospective origin audits, and data linkage with the Customs Department, the Department of Industrial Works, and provincial commercial offices. The DFT and the Customs Department were scheduled to meet the Office of the United States Trade Representative (“USTR”) between 28 and 31 August 2026.

Negotiation: The Government confirmed on 15 August 2026 that technical tariff discussions would take place at the end of August, led by the Deputy Prime Minister and Minister of Commerce. It cited Thai private-sector investment in the United States of close to USD 20 billion as evidence of mutual economic interest, and denied reports that the negotiations were linked to any security or military arrangement.

The trade surplus: Thailand exports more to the United States than it imports, but at least 30 percent of those exports are produced by U.S. companies operating manufacturing bases in Thailand. On Thailand’s analysis, the bilateral surplus therefore measures the depth of a shared supply chain rather than a one-sided advantage, and cannot be read from the headline figure alone. It must instead be assessed together with investment flows, the location of production, and the broader scope of economic activity between the two countries.

Key Takeaways

  • The Report places Thailand in Tier 2 of a three-tier transshipment risk classification, alongside Brazil, Indonesia, Malaysia, Turkey, and Vietnam.
  • The Report is analytical rather than legal. It imposes no measure and expressly acknowledges that the trade patterns it identifies do not, by themselves, establish illegal transshipment.
  • Thailand has expanded its CBP watch list to 67 items and 274 tariff lines effective 1 June 2026, is deploying AI-assisted origin risk assessment, and met with the USTR between 28 and 31 August 2026.
  • Approximately 72 percent of Thai product lines under Section 301 and Section 232 are already exempt, with roughly 28 percent remaining exposed.

Author: Panisa Suwanmatajarn, Managing Partner.

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DBD Opens Consultation on Exempting Five Business Categories from Foreign Business Licensing

Introduction

The Department of Business Development (the “DBD”) has published an announcement inviting public comments on the principles of a draft Ministerial Regulation Prescribing Businesses Not Requiring a License for the Operation of Business by Foreigners, B.E. …. (the “Draft Regulation”).

The Draft Regulation would allow foreign nationals to operate five categories of business without obtaining a license under the Foreign Business Act B.E. 2542 (1999) (the “FBA”). All five categories are already supervised by a sector regulator under specific legislation, reflecting the removal of duplicate licensing rather than the liberalization of previously unregulated activity.

Background

Section 9 of the FBA requires the Foreign Business Committee (the “Committee”) to review the restricted business categories under the lists annexed to the FBA at least once a year. Following its reviews for 2024 (B.E. 2567) and 2025 (B.E. 2568), the Committee resolved to propose removing five business activities from the restricted categories. The Committee reasoned that the businesses concerned are already supervised by specific agencies under specific laws, so removing them would reduce duplication in state oversight. It also considered that the exemptions are consistent with economic development and with the readiness of Thai operators to compete; further, because certain of the activities are provided only to affiliated companies, exempting them would reduce costs and facilitate business operations without exposing Thai operators to new competition.

Consultation

The consultation itself reflects a recent procedural change. Section 5 of the Act on Legislative Drafting and Evaluation of Law B.E. 2562 (2019) requires state agencies to conduct consultation and impact analysis before enacting any law, to disclose the results, and to take them into account at every stage of the process; this requirement applies to ministerial regulations by analogy.

On 10 March 2026 (B.E. 2569), the Cabinet approved recommendations of the Law Development Commission extending the minimum consultation period from not less than 15 days to not less than 30 days, and requiring agencies to consult on the principles of a law before it is drafted, in addition to consulting on the drafted text.

The present exercise is therefore a first-stage consultation on principles. The text of the Draft Regulation has not yet been produced, and a further consultation on the drafted provisions is expected to follow.

The consultation period runs from 10 August 2026 to 30 September 2026 (B.E. 2569). Comments may be submitted through the Central Legal System website and the DBD website.

The Five Proposed Categories

1. Businesses related to, supporting, or necessary for securities or derivatives business

A foreign national conducting any of these activities must already be licensed by the Office of the Securities and Exchange Commission (the “SEC Office”) to operate a securities business under the securities and exchange law, or a derivatives business under the derivatives law, and must obtain the SEC Office’s approval before commencing the additional activity.

2. Aircraft maintenance services

This covers the maintenance of aircraft, aircraft major components, appliances, and aircraft parts under the air navigation law. The Air Navigation Act B.E. 2497 (1954) (the “ANA”) requires a repair station certificate, issued in three types corresponding respectively to aircraft, aircraft major components, and appliances and parts. The ANA prohibits operating a repair station without such a certificate and requires applicants to meet prescribed qualifications. The certificate is issued by the Director of the Civil Aviation Authority of Thailand (“CAAT”), which would become the single licensing authority for the activity.

3. Procuring customers to offer financial products of companies within a financial business group

Please see details of explanation in Item 4.

4. Debt collection services provided to companies within a financial business group

For categories 3 and 4, the foreign operator must itself be a company within a financial business group and may provide the relevant services only to other companies within that group. The term “financial business group” follows the Bank of Thailand (“BOT”) notification, which covers a commercial bank together with its parent company, subsidiaries at every tier, and joint ventures, whether domestic or foreign. Both activities constitute a supporting business, and where the group company is itself a commercial bank, they fall within the “other services” framework.

One qualification applies to debt collection: where collection is made from a debtor who is a natural person, the activity constitutes a debt collection business under the Debt Collection Act B.E. 2558 (2015) and must be registered in accordance with the criteria, methods, and conditions prescribed under that Act and its associated Ministerial Regulation.

5. Service business where a state enterprise is the counterparty

This category differs in nature from the others: it is not a new exemption but a correction to an existing one.

The business already appears in the Ministerial Regulation Prescribing Service Businesses Not Requiring a License for Foreigners (No. 3), B.E. 2560 (2017), which was issued when the applicable budget legislation was the Budget Procedure Act B.E. 2502 (1959) (the “2502 BPA”). The Budget Procedure Act B.E. 2561 (2018) (the “2561 BPA”) subsequently narrowed the definition of “state enterprise” by excluding limited companies and public limited companies in which state enterprises hold more than 50 percent of the capital. The transitional provision of the 2561 BPA, however, provides that references to “state enterprise” in pre-existing legislation continue to carry the meaning under the 2502 BPA.

As a result, the term used in the 2017 Ministerial Regulation still bears the older, wider meaning, which is inconsistent with the definition now in force. The DBD proposes to align the reference with the 2561 BPA, together with a transitional provision preserving the rights of foreign nationals already providing services to state enterprises under the former definition before the Draft Regulation takes effect.

Legal Significance

The exemption removes the requirement to obtain the FBL. However, a foreign national or entity relying on it must still obtain the licenses and approvals from the other agencies regulating such activities as follows:

  • SEC Office licensing and approval for the securities-related activities;
  • A CAAT repair station certificate for aircraft maintenance;
  • The BOT financial business group framework for the two financial support services; and
  • Registration under the Debt Collection Act where collection is made from natural persons.

The scope conditions are also narrow and should be read closely. Categories 3 and 4 are available only to a company within a financial business group serving other companies within the same group — a limitation expressly intended to confine the commercial reach of the exemption so that Thai operators are not affected. Category 1 is confined to management, marketing, human resources, and information technology services, and to a defined class of recipients.

For category 5, the practical question runs the other way. Because the definition of “state enterprise” has narrowed, some foreign operators currently serving state-enterprise subsidiaries may fall outside the exemption once the reference is updated. The proposed transitional provision is intended to address this, and its drafting will matter to those affected.

Key Takeaways

  • The DBD is consulting on the principles of a Draft Regulation that would exempt five business categories from FBA licensing. The proposal remains subject to the legislative process and does not yet have legal effect.
  • The proposal aims to reduce regulatory duplication in areas where specific sectoral laws and regulators already apply.
  • Comments are open until 30 September 2026. This is a principles-stage consultation, and a second consultation on the drafted text is expected before the Draft Regulation is finalized.

Author: Panisa Suwanmatajarn, Managing Partner.

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Government Support for Small and Medium Enterprises (SMEs): Four New Economic Working Groups

Introduction

On 10 August 2026, Ms. Suphajee Suthumpun, Deputy Prime Minister and Minister of Commerce (“MOC”), chaired the first 2026 meeting of the Sub-Committee on the Development of Trade, Tourism and the Community Economy (the “Sub-Committee”). The Sub-Committee resolved to establish four specialized working groups tasked with restructuring the Thai economy across four dimensions:

  • the creative and visitor economy;
  • high-value agriculture and food security;
  • the community economy and SMEs; and
  • international trade.

The initiative is built on a two-tier delivery model:

  • Quick Big Win (short-term): targets measurable results within 6 to 12 months, principally by reviewing and removing regulatory requirements that obstruct business. This tier is deliberately confined to measures achievable without amending primary legislation and without requiring substantial budget allocation.
  • Big Win (long-term): targets structural reform over a two-to-four-year horizon to strengthen Thailand’s international competitiveness.

For businesses — particularly SMEs — the initiative carries particular significance. The MOC has identified small operators as accounting for approximately 35 percent of total national income, and the working group dedicated to the community economy and SMEs has been given an express mandate covering the entire entrepreneurial lifecycle, from business formation through to scale-up.

The initiative also places strong emphasis on regulatory and administrative reform. In particular, the Quick Big Win framework is intended to deliver practical improvements through measures that can generally be implemented without amendments to primary legislation.

The Four Working Groups

  1. Creative Economy and Visitor Economy
    This group aims to extend the policy frame beyond conventional tourism to a broader visitor economy that includes those travelling to Thailand for education, business, and wellness purposes. Its work draws on Thailand’s cultural capital, identity, and visitor experience, and seeks to connect secondary cities and local communities to visitor spending.
  2. Agricultural Products, Food Security, and High-Value Agriculture
    This group addresses the agricultural sector across the full value chain — upstream production, midstream processing, and downstream marketing — with the goal of moving Thai agriculture toward higher-value output, linking the sector more closely to industry and investment, and reinforcing food security.
  3. Community Economy and Small and Medium Enterprises (SMEs)
    This group covers the entrepreneurial ecosystem as a whole: reducing licensing burdens, streamlining permit processes, building operator knowledge, upgrading goods and services, and promoting both scale-up and fair competition. Wholesale and retail trade is treated as a connected dimension of the same mandate. The group’s focus reflects the Government’s broader objective of improving the business environment for SMEs through practical regulatory and administrative reform.
  4. International Trade
    This group focuses on promoting a more balanced import-export position, opening new markets, increasing utilization of existing free trade agreements, and responding to geopolitical pressure and non-tariff measures. It also carries the specific objectives of increasing SMEs’ share of the export structure and reducing dependency on any single market, thereby strengthening the resilience and international competitiveness of Thai businesses.

Legal and Regulatory Context

The Quick Big Win initiative is expected to be implemented through existing legal and administrative mechanisms, including:

  • Facilitation of Licensing and Public Services Consideration Act B.E. 2569 (2026): streamlines licensing procedures and public service delivery through new administrative mechanisms, replacing and expanding the earlier framework under the Facilitation of Official Licensing Consideration Act B.E. 2558 (2015).
  • Act on Legislative Drafting and Evaluation of Law B.E. 2562 (2019): facilitates stakeholder participation in the law-making and regulatory reform process.
  • SME Promotion Act B.E. 2543 (2000): provides the institutional framework for SME development and policy coordination.

These instruments provide the legal and administrative foundation for implementing the Quick Big Win agenda, particularly in relation to licensing simplification, regulatory reform, public service efficiency, and SME development.

Key Takeaways

  • The initiative underscores the strategic importance of SMEs in driving inclusive and sustainable economic growth.
  • The Quick Big Win framework aims to deliver measurable regulatory and administrative improvements within 6 to 12 months, primarily through reforms that do not require legislative amendment.
  • The Community Economy and SMEs Working Group has been tasked with supporting businesses throughout the entrepreneurial lifecycle — from establishment and compliance to expansion and competitiveness.
  • Businesses should closely monitor developments over the next 6 to 12 months and take advantage of opportunities to raise regulatory concerns as reforms are implemented.
  • Although the initiative does not create binding legal obligations, it offers an early indication of the Government’s priorities for future economic and regulatory reform.

Author: Panisa Suwanmatajarn, Managing Partner.

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Cabinet Approves Draft Ministerial Regulation Introducing Per-Item Fees for DBD Data Linkage Services

On August 7, 2026, The Deputy Government Spokesperson announced that the Cabinet of Thailand (“Cabinet”) has approved in principle a draft Ministerial Regulation Prescribing Fee Rates and Fee Exemptions for Registration, Requests for Document Inspection, Requests for Certified Copies, and Other Fees Relating to Partnerships and Limited Companies B.E. …. (“Draft Regulation”), as proposed by the Ministry of Commerce (“MOC”). The Draft Regulation has been referred to and is currently under the Office of the Council of State’s review. The Cabinet also instructed the MOC to take into account comments from the Office of the National Economic and Social Development Council regarding this Draft Regulation.

Background

Members of the public and businesses can currently verify juristic person information through a data linkage between the Department of Business Development (“DBD”) computer network and the user’s own system. Under the Ministerial Regulation Prescribing Fee Rates, Fee Reductions and Fee Exemptions Relating to Partnerships and Limited Companies B.E. 2563 (2020) (the “2563 Regulation”), a fee of THB 30 is charged per data set, with each set comprising six items:

  • name of the partnership or limited company
  • director information
  • number and names of authorized directors
  • registered capital
  • head office and branch locations
  • corporate objectives

The current system does not permit partial data requests: a user seeking only a single item — for example, registered capital — must nevertheless pay THB 30 for the full data set. The MOC considers this structure an unnecessary cost burden on both the public and private sectors, an obstacle to digital government development, and inconsistent with modern business practices that call for selective data access.

The Draft Regulation therefore aims to lower data-linkage service costs for juristic person verification by the public and private sectors. It also seeks to encourage corporate transactions through reliable electronic platforms, accelerate digital transformation in government, facilitate inter-agency data integration, and enable the DBD to expand its service coverage.

Key Changes

  • Introduction of a per-item fee. A new fee of THB 5 per individual item will apply to company certificate data. Users may still request the complete data set at the existing rate of THB 30, while the installation fee for the data linkage program remains THB 3,000 per instance. This allows users to select and pay only for the items they require.
  • Removal of the expired e-Registration discount. Clause 4 of the 2563 Regulation — which granted a 50 percent reduction on certain registration fees for partnerships and limited companies filing through the electronic juristic person registration system between 1 January 2021 and 31 December 2023 — will be deleted, as the discount period has already lapsed.

Key Takeaways

  • Users of the DBD data linkage service will be able to obtain individual certificate items at THB 5 each, rather than paying THB 30 for the full six-item data set.
  • For a typical two-item request, cost will fall from THB 30 to THB 10.
  • The THB 3,000 installation fee and the THB 30 full-set option are retained; all other registration and document fees are unaffected.
  • The Draft Regulation remains subject to review by the Office of the Council of State and is not yet in force. Businesses relying on the data linkage service should monitor the Royal Gazette for the effective date.

Author: Panisa Suwanmatajarn, Managing Partner.

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Big Data: Thailand Approves National Strategy to Accelerate AI and Data-Driven Economy

Thailand’s Cabinet has acknowledged the draft National Big Data Strategy, establishing the country’s first comprehensive policy framework for the development and use of big data as a foundation for digital government, artificial intelligence (AI), and a data-driven economy.

The strategy is intended to provide a unified direction for government agencies to improve data management, strengthen digital infrastructure, and promote the practical use of data in both the public and private sectors.

Why the strategy matters:

Although the strategy is not legislation and does not itself impose new legal obligations, it signals the Government’s long-term policy direction. Businesses operating in Thailand—particularly technology companies, cloud service providers, AI developers, healthcare providers, financial institutions, and organizations handling government-related data—should expect increased public investment and regulatory attention in data governance and AI.

The strategy also reinforces the Government’s objective of using data as a strategic national asset to improve public administration, support economic growth, and enhance Thailand’s digital competitiveness.

Key objectives:

According to the announcement, the strategy seeks to:

  • establish an integrated national big data ecosystem;
  • improve evidence-based policy making through better use of government data;
  • support AI adoption across government and industry;
  • enhance Thailand’s digital competitiveness; and
  • promote responsible and systematic use of data.

The Government has also set measurable goals, including increasing the economic value generated from big data and positioning Thailand among the world’s leading countries in big data capability.

Four strategic pillars:

The strategy consists of four principal initiatives.

1. Building national data infrastructure

The Government plans to strengthen core digital infrastructure through initiatives such as:

  • Government Cloud;
  • Government Data Catalog; and
  • National Big Data Platform.

These projects are intended to improve interoperability and enable more effective data sharing among government agencies.

2. Expanding practical use of data

The strategy encourages wider use of data analytics to address national priorities, including:

  • healthcare;
  • tourism;
  • environmental management;
  • agriculture; and
  • trade and economic development.

This reflects the Government’s intention to move beyond data collection toward data-driven decision-making.

3. Accelerating AI adoption

A significant component of the strategy is the promotion of AI across the public and private sectors.

The Government intends to:

  • expand AI applications in government services and industry;
  • support development of Thai-language AI models; and
  • establish datasets suitable for AI development.

These initiatives may create opportunities for AI developers, cloud providers, data platform operators, and businesses offering AI-enabled solutions.

4. Developing human capital

Recognizing that technology alone is insufficient, the strategy also emphasizes workforce development by increasing the number of professionals with expertise in big data and AI.

The Government aims to significantly expand the pool of skilled personnel capable of supporting Thailand’s digital transformation.

Legal and regulatory implications:

The strategy itself does not amend Thailand’s existing legal framework, including laws governing personal data protection, cybersecurity, or digital government.

Nevertheless, it indicates that future regulatory and policy initiatives are likely to focus on:

  • enhanced government data governance;
  • improved standards for data interoperability;
  • greater integration of public-sector datasets;
  • expanded use of AI in government services; and
  • stronger digital infrastructure supporting government cloud and data-sharing initiatives.

Organizations participating in government projects or processing government-related data should therefore continue monitoring future implementing measures, technical standards, procurement requirements, and sector-specific regulations that may follow.

Looking ahead:

The National Big Data Strategy represents an important policy milestone in Thailand’s digital transformation agenda. While much of its implementation will depend on future projects, funding, and regulatory measures, the strategy demonstrates the Government’s commitment to treating data and AI as key drivers of economic development and public-sector modernization.

For businesses, the announcement suggests increasing opportunities in AI, cloud computing, digital infrastructure, and government technology, while reinforcing the importance of robust data governance and regulatory compliance.

Key takeaways:

  • Businesses involved in AI, cloud services, digital infrastructure, and government technology should monitor future implementing regulations, technical standards, and procurement initiatives arising from the strategy.
  • Thailand has adopted its first comprehensive national strategy for big data development.
  • The strategy serves as a policy framework rather than creating immediate legal obligations.
  • Four priorities include national data infrastructure, wider use of data analytics, AI adoption, and workforce development.
  • Government investment is expected to accelerate in cloud infrastructure, data platforms, and AI ecosystems.

Author: Panisa Suwanmatajarn, Managing Partner.

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Thailand Tightens Registration Requirements for Partnerships and Limited Companies with Foreign Participation

Nominees: A Threat to Thailand’s Economy

Nominee arrangements — in which Thai nationals hold shares or capital contributions on behalf of foreign investors — have remained a longstanding compliance concern under the Foreign Business Act B.E. 2542 (1999) (the “FBA”). The Department of Business Development (the “DBD”) has now shifted a significant part of that scrutiny to the registration stage itself.

The use of nominees is a major national concern that undermines Thailand’s economic and business security by distorting market competition, reducing tax revenue, and eroding investor confidence. Foreign operators who rely on nominees unfairly bypass statutory business restrictions, undercutting law-abiding foreign investors and overwhelming Thai small and medium-sized enterprises (SMEs) that cannot compete against superior capital and resources — ultimately contributing to job losses and business closures. Nominee structures also facilitate tax evasion, money laundering, and other illicit financial activity, which compromises state revenue collection and damages Thailand’s international reputation by exposing gaps in regulatory and legal enforcement.

For these reasons, the rigorous inspection of, and crackdown on, nominee arrangements is a critical measure to protect the country’s economic interests, ensure fair competition, and safeguard the long-term stability of the Thai economy.

Background

Initial screening at the company incorporation stage previously offered partial protection against nominee risk by verifying Thai investment capital. However, bad actors circumvented these controls through subsequent corporate amendments — transferring shares or directorships to foreign nationals only after the company had already secured initial approval.

Legal Basis

To close this loophole, the DBD issued the “Central Partnership and Company Registrar Order No. 2/2569, Prescribing the Criteria and Supporting Documents for Applications for the Registration of the Incorporation and Amendment of Partnerships and Limited Companies Where Foreign Nationals Participate in the Investment or Hold Signing Authority in Partnerships and Limited Companies” (the “Order”). The Order took effect on 1 August 2026.

The Order extends DBD oversight across the full business lifecycle — from incorporation through post-registration amendments — to prevent unauthorized structural changes, while imposing stricter documentation requirements on all relevant registration applications.

It consolidates existing requirements by repealing two earlier orders:

  1. Order No. 2/2568, dated 1 December 2025 (B.E. 2568), concerning the registration of incorporation involving foreign investment, foreign directors, or foreign authorized signatories in a legal entity; and
  2. Order No. 1/2569, dated 16 March 2026 (B.E. 2569), concerning amendment registrations admitting foreign nationals as partners or as authorized signatory directors.

According to its preamble, the Order is intended to enhance the credibility of the commercial register, to prevent the concealment or disguise of funds derived from unlawful conduct through nominee arrangements, and to deter Thai nationals from providing assistance or support to, or jointly operating a business with, foreign nationals in the nature of a nominee.

New Legal Requirements

1. Registration of Incorporation

The additional documentary requirements apply to an application for the registration of incorporation in either of the following cases:

  • a partnership or limited company in which a foreign partner or shareholder contributes, or holds, less than 50% of the capital contribution or registered capital; or
  • a limited company with no foreign shareholder, where a foreign national serves as a director authorized to sign — whether solely or jointly — so as to bind the company.

Supporting documents required at incorporation

Applicants falling within the above categories must submit a Letter of Clarification on Investment, in the form annexed to the Order, together with the following bank statements:

  • a statement of the account from which each Thai partner or shareholder made payment, covering the three months prior to the date of payment and evidencing a withdrawal or transfer consistent with the amount and date of payment;
  • a statement of the account of the managing partner or director who received the funds, evidencing receipts consistent with the amount and date of payment from each partner and shareholder; and
  • where the receiving account is also the account relied upon to evidence payment under the first item above, an additional statement covering the three months prior to the date of receipt.

The third requirement addresses situations in which the managing partner or director settles their own contribution from funds already held in the receiving account, rather than by a traceable transfer. In such cases, the source of those funds must be explained separately in the Letter of Clarification.

2. Amendment Registrations Involving Foreign Nationals

A Letter of Confirmation of Investment, also in the form annexed to the Order, must be submitted with an application to register an amendment admitting a foreign national as a partner, or appointing a foreign national as an authorized signatory director, in either of the following cases:

  • a partnership in which all partners were previously Thai nationals, or in which foreign partners held 50% or more of the capital contribution, where the amendment results in foreign partners holding less than 50% and no foreign national serving as managing partner; or
  • a limited company in which all directors authorized to bind the company were previously Thai nationals, where an amendment to the directors — or to the number or names of the directors signing to bind the company — results in a foreign national holding sole or joint signing authority.

3. Additional Requirements for Recently Incorporated Entities

Where a partnership or limited company incorporated on or after 1 August 2026 submits an amendment application of the type described above within one year of its registration as a juristic person, it must additionally submit the amendment version of the Letter of Clarification on Investment, together with a bank statement evidencing that the entity — or the managing partner or director on its behalf — received the full amount of the capital contributions or share payments called up at incorporation.

This requirement addresses the sequencing of transactions whereby an entity is incorporated with Thai partners or directors and a foreign national is introduced shortly thereafter.

Legal Significance

The Order does not introduce a new prohibition; nominee arrangements already constitute an offence under Section 36 of the FBA. Its significance instead lies in shifting the evidentiary burden to the point of registration, and in the personal declaration now required of the signatory.

Under the Letter of Confirmation of Investment, the managing partner or authorized director confirms that all partners have genuinely made and paid their capital contributions, that all shareholders have genuinely paid for their shares, and that no Thai national has provided assistance or support to, or jointly operated a business with, a foreign national in the nature of a nominee. The signatory further acknowledges the following penalties:

  • Section 36 of the FBA: imprisonment not exceeding 3 years, a fine of THB 100,000 to 1,000,000, or both;
  • Section 137 of the Criminal Code (false statements to an official): imprisonment not exceeding 6 months, a fine not exceeding THB 10,000, or both; and
  • Section 267 of the Criminal Code (causing a false entry in a public document): imprisonment not exceeding 3 years, a fine not exceeding THB 60,000, or both.

Key Takeaways

  • Existing entities are unaffected until they register a qualifying amendment, at which point the Order applies in full.
  • The Order took effect on 1 August 2026 and applies to partnerships and limited companies in which foreign participation is below 50%, and to limited companies in which a foreign national holds signing authority.
  • Documentary requirements now extend to bank statements evidencing both the payment and receipt of capital contributions and share payments, supported by a prescribed clarification letter.
  • Amendment registrations introducing a foreign partner or foreign signatory require a signed Letter of Confirmation of Investment, which carries personal criminal exposure for the signatory.
  • Entities incorporated on or after the effective date are subject to additional requirements if a qualifying amendment is registered within their first year.

Author: Panisa Suwanmatajarn, Managing Partner.

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