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Investment Trends in Thailand in 2025: The Increase in Foreign Investment Reflecting Thailand’s Potential to Attract Global Investors

In the face of a rapidly evolving global economy, Thailand has demonstrated a clear commitment to becoming a leading investment hub in the region. With its robust strategic advantages, ongoing infrastructure advancements and attractive investment support initiatives, the Thai government is diligently working to position the country as a premier destination for global investors.

The Director-General of the Department of Business Development, Ministry of Commerce, recently announced a notable surge in foreign investment, with 181 permits issued under the Foreign Business Act B.E. 2542 (1999) in the first two months of 2025. This marks a significant 68% increase compared to the same period last year, reflecting growing investor confidence in Thailand’s economic prospects and its continued recovery.

The investment landscape comprises 41 applications for Foreign Business Licenses (FBL) and 140 applications for Foreign Business Certificates (FBC), as well as those under treaties or international agreements. The most prominent foreign investors in Thailand come from leading economies such as Japan, China, Singapore, the United States and Hong Kong, engaging in the following business activities:

  1. Japan: With the highest investment rate at 21% and a total investment of 13,676 million baht, Japanese companies primarily focus on raw material sourcing, management solutions and Original Equipment Manufacturing (OEM).
  2. China: Representing 13% of investments with a total of 5,113 million baht, Chinese companies concentrate on raw material procurement, customs clearance within free trade zones, factory rentals and OEM.
  3. Singapore: Contributing 13% of investments with a total of 4,490 million baht, Singaporean enterprises invest primarily in modern distribution center services, tire research and development, data center operations and OEM.
  4. United States: Accounting for 11% of investments with a total of 1,372 million baht, American investors are active in retail, data support services for securities trading on the Stock Exchange of Thailand (SET) and OEM.
  5. Hong Kong: Comprising 9% of investments with a total of 1,587 million baht, Hong Kong businesses focus on engineering and technical services, modern distribution center operations, electric vehicle (EV) charging station infrastructure and OEM.
statues on buddhist temple

The Eastern Economic Corridor (EEC) has emerged as a key magnet for foreign capital, attracting 57 foreign investment projects, marking a remarkable 63% increase and representing 31% of total foreign investments. The total investment value within the EEC reached an impressive 17,546 million baht, accounting for 50% of all foreign investments during this period.

The EEC attracts investment across diverse sectors including retail, plastic mold manufacturing, refrigeration components, parts for tire manufacturing machinery, factory rental services, customs clearance services within free trade zones and OEM of various products such as automotive parts, metal stampings and molds. Key investors in the EEC include Japan, China, Singapore and other countries.

Thailand’s robust investment appeal is driven by a competitive environment supported by the Thailand Board of Investment (BOI). The BOI offers a comprehensive range of incentives including:

  • Corporate Income Tax (CIT) exemptions (up to 13+ years)
  • Import duty exemptions on key machinery and materials
  • Deductions for operational and R&D costs

Non-tax benefits include conditional foreign land ownership, streamlined visa and work permit processes and convenient one-stop services. These incentives are strategically designed to attract investments in high-tech, value-added and other key industries. Additionally, projects located in designated zones such as the EEC are eligible for enhanced benefits.

In conclusion, the significant rise in foreign investment in early 2025, particularly within the dynamic EEC, highlights Thailand’s growing prominence as a leading investment destination in Asia. Fueled by investor confidence, strategic advantages and proactive government policies, Thailand is reinforcing its position as a key hub for international capital and a vital player in the regional economic landscape.

Author: Panisa Suwanmatajarn, Managing Partner.

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Over The Top: Thailand’s Push to Regulate Online Streaming Platforms

In a significant step toward managing the rapid rise of Over-The-Top (OTT) platforms, Thailand’s Ministry of Digital Economy and Society has launched an initiative to bring these online streaming services under closer scrutiny. The Ministry has entrusted the National Broadcasting and Telecommunications Commission (NBTC) and the Electronic Transactions Development Agency (ETDA) with the task of forming a dedicated working committee. This group is charged with studying and proposing regulatory measures for OTT platforms—services that deliver diverse content, including movies, TV shows, music, and podcasts, directly to users via the internet. Unlike conventional media, these platforms operate independently of mobile network providers, cable operators, or digital TV broadcasters. Well-known examples include Netflix, YouTube, Disney+, TikTok, and Spotify.

Government Concerns:

The decision to regulate OTT platforms arises from mounting concerns about their potential exploitation. Authorities have noted that these services can serve as conduits for online crimes, such as fraud, the spread of inappropriate content, and copyright violations, all of which have caused significant harm to the public. In response, the Ministry aims to create a digital landscape that is secure, equitable, and sustainable, benefiting consumers, service providers, and the digital economy as a whole.

Focus Areas:

To this end, the working committee has identified five core areas of focus, each addressing distinct challenges posed by OTT platforms while fostering a fair and innovative digital environment.

little girl holding a tablet

1. Enhancing Safety Measures

The first area of focus is strengthening safety protocols. This involves curbing copyright infringement and preventing access to illegal content. The committee plans to introduce identity verification measures to deter misuse of these platforms, ensuring they are not exploited for illicit purposes.

2. Regulating Content

The second priority centers on content oversight. The committee seeks to refine existing laws, empowering regulatory bodies to monitor and control the material distributed on OTT platforms more effectively. Additionally, foreign platforms operating in Thailand will be required to obtain licenses and comply with local laws. The initiative also includes advocating for international cooperation in establishing shared regulatory frameworks.

3. Boosting the Digital Industry and Taxation

The third focus area aims to promote Thailand’s digital industry while ensuring fair economic contributions from OTT platforms. This includes supporting local entrepreneurs in developing homegrown platforms and mandating that OTT services generating revenue from Thai users pay taxes in the country. These efforts are intended to drive the rapid growth of domestic digital businesses and create added value within the national economy.

4. Protecting Personal Data

Data privacy is the fourth pillar of this regulatory framework. OTT platforms will be required to adhere to stringent data protection standards, such as those outlined in the European Union’s General Data Protection Regulation (GDPR). Measures will also be implemented to regulate the collection and use of user data, safeguarding individuals’ privacy rights and preventing abuses.

5. Ensuring Fair Competition

Finally, the committee will address competition in the OTT market. The goal is to prevent large platforms from establishing monopolies that could stifle fair competition. By supporting the development of local platforms and promoting market decentralization, the initiative seeks to level the playing field and encourage innovation.

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A Forward-Looking Approach:

This comprehensive strategy reflects Thailand’s recognition of both the opportunities and risks presented by OTT platforms. As these services continue to reshape how people consume media, the Ministry of Digital Economy and Society, alongside the NBTC and ETDA, is taking proactive steps to harness their potential while mitigating their downsides. By focusing on safety, content regulation, economic fairness, data protection, and competitive balance, Thailand aims to set a precedent for responsible digital governance—one that could resonate on the global stage.

As the working committee begins its task, the nation watches closely, hopeful that these measures will pave the way for a digital future that is not only vibrant and innovative but also secure and just for all.

Author: Panisa Suwanmatajarn, Managing Partner.

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Currency Exchange: Harmonized Local Currency Transaction Framework Enhances Cross-Border Trade in ASEAN

The Bank of Thailand (BOT), Bank Indonesia (BI), and Bank Negara Malaysia (BNM) have taken a significant step toward strengthening regional economic integration by adopting the harmonized Local Currency Transaction Framework Operational Guidelines (LCTF OG) and expanding the scope of eligible cross-border transactions under the framework. This initiative aims to promote the use of local currencies in trade and investment, mitigate exchange rate risks, and enhance efficiency in cross-border transactions.

The harmonized LCTF OG consolidates previously established bilateral guidelines between the three countries, creating a unified standard that ensures consistency, scalability, and transparency for participating financial institutions and their users. By streamlining processes and accommodating specific regulatory requirements of each jurisdiction, the framework provides a robust foundation for facilitating local currency transactions across Thailand, Indonesia, and Malaysia.

A key feature of the updated framework is the inclusion of portfolio investments as eligible underlying transactions, alongside trade in goods and services and direct investments. This expansion offers investors greater opportunities to conduct transactions in local currencies, reducing their exposure to exchange rate volatility and fostering deeper regional financial integration.

To support the expanded framework, BOT, BI, and BNM are inviting additional qualified commercial banks to participate in the LCTF. These banks, leveraging their expertise, operational capabilities, and cross-border networks, will play a pivotal role in facilitating local currency transactions and driving the adoption of the framework.

Since the initial implementation of the LCTF, Thailand, Indonesia, and Malaysia have observed a steady increase in local currency transactions for bilateral trade. The harmonized framework is expected to further enhance cross-border transaction options for businesses, reaffirming the commitment of the three countries to promote the use of local currencies in regional trade and investment.

Background: Promoting Local Currency Usage in ASEAN

The BOT, in collaboration with BI and BNM, has long recognized the strategic importance of local currency transactions in mitigating exchange rate risks and fostering economic stability. The Local Currency Settlement Framework, initiated under the BOT’s 2017-2019 international connectivity plan, laid the groundwork for this effort. The framework was further advanced through the Indonesia-Malaysia-Thailand Framework for Cooperation on Local Currency Transactions, formalized via three memorandums of understanding (MoUs) signed in August 2023.

In February 2025, the three central banks officially announced the adoption of the harmonized LCTF OG, marking a milestone in regional financial cooperation. The framework is designed to address the challenges of exchange rate volatility by providing businesses with a reliable mechanism to conduct transactions in local currencies.

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Key Features of the LCTF OG:

  1. Standardization: The framework unifies existing bilateral guidelines into a single set of operational standards, ensuring consistency and clarity for all participants.
  2. Enhanced Efficiency and Transparency: Streamlined processes reduce transaction complexities, improving efficiency and transparency for businesses and financial institutions.
  3. Flexibility for Local Regulations: While establishing common guidelines, the framework allows each country to adapt the rules to align with its specific legal and regulatory requirements.
  4. Expanded Transaction Scope: In addition to trade in goods and services and direct investments, the framework now includes portfolio investments, broadening the range of eligible transactions.
  5. Facilitation for Commercial Banks: The framework simplifies criteria for Appointed Cross Currency Dealers (ACCDs), enabling qualified commercial banks to play a more active role in facilitating local currency transactions.

Expected Outcomes:

The harmonized LCTF OG is expected to deliver several benefits, including:

  • Increased Convenience and Efficiency: Businesses will experience smoother and faster cross-border transactions using local currencies.
  • Reduced Exchange Rate Risks: By minimizing reliance on major currencies like the US dollar, businesses can better manage currency volatility.
  • Enhanced Regional Trade and Investment: The framework will stimulate economic activity within ASEAN by encouraging the use of local currencies in trade and investment.

Current Status and Future Prospects:

As of now, the LCTF OG is operational among qualified commercial banks and the central banks of Thailand, Indonesia, and Malaysia. While the framework remains an internal matter for the participating institutions, the central banks are actively encouraging more qualified commercial banks to join and support its expansion. This collaborative effort underscores the commitment of BOT, BI, and BNM to fostering regional economic resilience and integration.

Conclusion:

The adoption of the harmonized LCTF OG represents a significant advancement in promoting the use of local currencies for cross-border transactions in ASEAN. By standardizing processes, enhancing transparency, and expanding the scope of eligible transactions, the framework provides businesses with a powerful tool to mitigate exchange rate risks and streamline international trade. As Thailand, Indonesia, and Malaysia continue to lead this initiative, the LCTF OG is poised to play a pivotal role in driving regional economic growth and strengthening financial cooperation within ASEAN.

Author: Panisa Suwanmatajarn, Managing Partner.

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PDPA: Announcement on Administrative Fine Guidelines Seeks Public Comments

The Personal Data Protection Committee (PDPC) is set to issue a new announcement concerning the “Guidelines for Issuing Administrative Fine Orders by the Expert Committee.” Before finalizing, the PDPC is inviting public comments to ensure that the guidelines are comprehensive and effective. This article outlines the key elements, issues, and principles involved in this draft announcement.

Background and Principles:

Under Sections 74 and 90 of the Personal Data Protection Act B.E. 2562 (2019), administrative enforcement measures must align with the law governing administrative procedures. The current draft aims to repeal the definition of “administrative fine enforcement officer” and introduce a new definition for “administrative enforcement officer,” ensuring consistency with existing laws.

Key Issues:

Revised Definitions: The draft proposes to repeal the term “administrative fine enforcement officer” and introduce “administrative enforcement officer,” aligning with administrative laws.

  • Clear Procedures: Specifies detailed procedures for issuing fines and enforcing measures such as seizure, attachment, or auction.
  • Consideration Factors: Lists factors like severity of violation, size of operations, and impact on data subjects to consider when imposing fines.

Key Elements:

  • Administrative Enforcement Officer:

Defined as an official or employee of the Office of the Personal Data Protection Committee appointed by the Secretary-General.

Responsible for implementing measures like seizure, attachment, and auction.

  • Fine Definition:

Refers to the administrative fine ordered by the Expert Committee.

  • Notification Methods:

Allows for electronic notifications under urgent circumstances or if preferred by the affected party.

  • Factors for Consideration:

Includes details of the offense, severity, size of operations, effectiveness of the fine, benefits to data subjects, extent of damages, history of fines, responsibility levels, ethical codes, remedies, compensation payments, reasons and limitations, and other relevant facts.

  • Issuing Orders:

Non-severe cases may involve warnings or corrective actions.

Severe cases or ineffective initial orders will result in administrative fines.

  • Enforcement Actions:

If the obligated party fails to pay the fine, enforcement officers will issue a written notice demanding payment within no less than seven days.

Failure to comply can lead to seizure, attachment, or auction of property.

Public Consultation Period:

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The PDPC invites stakeholders and the public to review the draft and provide feedback from 20 February to 6 March 2025. This consultation period aims to gather diverse insights to enhance the effectiveness and fairness of the guidelines.

Conclusion:

By aligning with administrative laws and considering public input, the PDPC aims to strengthen data protection enforcement in Thailand. All interested parties are encouraged to participate in this crucial consultation phase to shape robust data protection measures.

This draft announcement underscores the PDPC’s commitment to ensure that administrative enforcement actions under the Personal Data Protection Act are consistent, clear, and effective. Your participation in the public consultation can significantly contribute to achieving these goals.

Author: Panisa Suwanmatajarn, Managing Partner.

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Foreign Investment: Updates Framework for Investment Protection Agreements

Thailand has taken significant steps to modernize its framework for international investment protection, aiming to enhance clarity, transparency, and alignment with global standards. The Cabinet recently approved revisions to the criteria governing investment protection under the Agreement on the Promotion and Protection of Investments between Thailand and foreign countries. These changes replace the previous framework established in 2003 and reflect Thailand’s commitment to fostering a favorable environment for foreign direct investment (FDI) while safeguarding national interests.

Key Updates to Investment Protection Criteria:

The revised framework introduces several important changes to the criteria for investment protection, as outlined below:

  1. Scope of Protected Investments
    • Previous Criteria: Protection was limited to foreign direct investments (FDI).
    • Revised Criteria: The scope remains unchanged, with protection still applying exclusively to FDI.
  1. Types of Protected Investments
    • Previous Criteria:
      • Investments authorized by the Minister or Director-General under the Foreign Business Act B.E. 2542.
      • Investments are granted promotion certificates by the Board of Investment (BOI).
      • Investments under concession agreements with government agencies.
    • Revised Criteria:
      • Investments in business operations, activities, or other forms of investment (excluding shareholding) are permitted under Thai law for foreign nationals, in line with government policies and international investment protection agreements.
      • Investments under concession agreements with government agencies.
      • Shareholding investments in legal entities engaged in the above activities or other Thai entities provided the foreign investor holds at least 10% of the entity’s capital, supported by evidence.
  1. Other Protected Direct Investments
    • Previous Criteria: Investments falling outside the three specified categories or made before the effective date of the Cabinet resolution required a Certificate of Approval for Protection (C.A.P.) from the C.A.P. Committee.
    • Revised Criteria: Investments not meeting the specified criteria will no longer be eligible for protection.
  1. Protection Assessment Mechanism
    • Previous Criteria: The C.A.P. Committee reviewed and approved investment protection under the agreement.
    • Revised Criteria: No review mechanism exists. Investments failing to meet the criteria will not receive protection.
  1. Scope of Application
    • Previous Criteria: Not explicitly defined.
    • Revised Criteria: The updated criteria will apply to all future agreements and 47 existing international investment agreements, including:
      • 36 Bilateral Investment Treaties (BITs): For example, the agreement between Thailand and the United Kingdom on investment promotion and protection.
      • 11 Free Trade and Regional Investment Agreements: Such as the Thailand-Australia Free Trade Agreement and the Regional Comprehensive Economic Partnership (RCEP).
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Background and Rationale:

The revision of investment protection criteria follows extensive consultations between the Ministry of Foreign Affairs and relevant agencies. The goal is to align Thailand’s investment protection framework with current global practices and ensure it supports the country’s economic and social development. Notably, the updated criteria emphasize protecting only those investments that contribute significantly to Thailand’s overall benefit, in line with the nation’s investment protection policies.

Thailand has also actively promoted international cooperation on investment by sharing its draft Bilateral Investment Treaty Model 2020 (BIT Model) with 15 countries. To date, four countries—Brazil, Kenya, Saudi Arabia, and Ukraine—have expressed interest in negotiating investment protection agreements with Thailand.

Implications of the Revised Framework:

The updated criteria aim to:

  • Enhance Clarity and Transparency: By clearly defining the types of investments eligible for protection, the framework reduces ambiguity for foreign investors.
  • Streamline Processes: The removal of the C.A.P. Committee’s review mechanism simplifies the process for eligible investments.
  • Promote Sustainable Investment Growth: By focusing on investments that align with Thailand’s development goals, the framework encourages long-term, mutually beneficial partnerships.

Conclusion:

Thailand’s revised investment protection framework represents a significant step forward in creating a modern, transparent, and investor-friendly environment. By updating its criteria and aligning them with international standards, Thailand aims to attract high-quality foreign investments that contribute to the country’s sustainable economic growth. These changes underscore Thailand’s commitment to balancing investor protection with national interests, ensuring a win-win scenario for all stakeholders.

Author: Panisa Suwanmatajarn, Managing Partner.

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Thailand ‘Ignite Finance’ Draft Legislation: Paving the Way for Thailand’s Global Financial Hub

Thailand’s Ministry of Finance launched the Ignite Finance program (“Ignite Finance”) in 2024 as a cornerstone of the broader Ignite Thailand vision. This initiative aims to transform Thailand into a regional leader across eight critical industries by leveraging the country’s strengths in workforce, infrastructure, and technology. As part of the government’s strategy, Ignite Finance seeks to position Thailand as a leading financial center in the region, attracting global financial institutions and fostering economic growth.

Strategic Vision: Ignite Finance 

The strategic vision of Ignite Finance is encapsulated under the acronym “GLOBALIZATION,” which emphasizes the movement of four key elements: money, people, data/knowledge, and goods/services. The government aims to make Thailand a global financial sanctuary, or Thailand Financial Center (TFC), by focusing on three fundamental pillars:

  1. Future-Ready Regulation: The Ministry of Finance is drafting a new set of financial business laws (“Draft Legislation”) designed to be agile, transparent, and conducive to investment. These laws will establish a comprehensive regulatory framework for five key areas of the financial sector: banking, securities, derivatives, digital assets, and insurance. The goal is to streamline licensing, supervision, and strategic direction while ensuring coordination with relevant agencies to meet the needs of businesses and expand Thailand’s financial sector on the global stage.
  1. Next-Generation Incentives: Ignite Finance aims to make Thailand the top choice for global financial institutions by offering attractive incentives, including tax benefits comparable to other financial hubs, streamlined company registration for foreign entities, work visas for expatriates and their families, and additional grants. These incentives are designed to attract foreign financial institutions to establish operations in Thailand.
  1. Empowered Ecosystem: The program will develop a robust and transparent legal framework to support financial businesses, similar to Thailand’s Digital Asset Act. It will also focus on modern infrastructure to enhance business operations and the quality of life for professionals. Additionally, the Ministry of Finance, in collaboration with the Bank of Thailand, is introducing innovative financial policies, such as Virtual Banks (branchless banks that use alternative data for credit scoring) and the establishment of the National Credit Guarantee Agency (NaCGA) to promote fair competition and improve access to financial services for SMEs and individuals.
aerial photography of buildings

Key Principles of the Draft Legislation

  1. Business Categories under the Financial Hub: Businesses operating within the Financial Hub must provide services exclusively to non-resident clients and fall under one of the following categories: 
    • Commercial Banking   
    • Payment Services   
    • Securities and Investment
    • Derivatives
    • Digital Assets 
    • Insurance 
    • Reinsurance Brokerage 
    • Financial Services or Other Activities Supporting Financial Operations 

These businesses must be registered as limited companies or public limited companies in Thailand or as branches of foreign entities. They are also required to employ Thai nationals at a specified ratio.

  1. Incentives for Target Businesses: Businesses within the Financial Hub will be eligible for tax and non-tax incentives, including exemptions from foreign business operation laws, streamlined licensing under the Exchange Control Act, facilitated entry for foreign personnel, and ownership rights to condominium units for business and residential use.
  1. Supervision of Target Businesses: The Office of the Board of Investment and Promotion of Financial Centers (OSA Office) will provide end-to-end services, while the OSA Board will oversee policy formulation, promotion of target businesses, licensing, and supervision. Businesses must comply with international standards for Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT).
  1. Criminal Penalties and Administrative Fines: The Draft Legislation imposes criminal penalties for serious offenses, such as operating without a license, non-compliance with regulations affecting economic stability and operating outside the scope of the granted license. Administrative fines will be levied for less severe violations.

Economic and Social Impact:

The establishment of Thailand as a financial hub offers significant benefits for economic growth and development: 

  1. Attracting Foreign Investment: By attracting global financial institutions, Thailand will enhance its competitiveness, create new revenue streams, and stimulate economic growth. 
  1. Developing Skilled Labor: The Financial Hub will foster the development of a highly skilled Thai workforce in finance, technology, and financial support services, facilitating knowledge transfer and creating new job opportunities. 
  1. Promoting Economic Growth: The initiative will generate business opportunities for Thai enterprises, drive infrastructure development, and advance Thailand’s financial system, fostering innovation and sustained economic growth.
low angle photography of highrise buildings

Key Steps for the Draft Legislations to Become Law:

Following the Cabinet’s approval of the Draft Legislation in principle, the Council of State will conduct a legal review to ensure alignment with Thailand’s legal framework. The Draft Legislation will then be debated and approved by the House of Representatives and the Senate before being submitted to the King for royal assent. Once published in the Royal Gazette, the legislation will take effect 360 days later, allowing time for implementation preparations. Each step reinforces Thailand’s strategic goal of establishing a robust foundation to become a global financial hub.

Conclusion:

Thailand’s Ignite Finance program represents a strategic leap toward becoming a global financial hub. By offering a robust legal framework, attractive incentives, and a focus on innovation, Thailand is well-positioned to attract global financial institutions and drive economic growth. The next steps involve the review and approval of the draft legislation by the Council of State, Parliament, and the King, which will be critical to realizing Thailand’s vision of becoming a premier financial hub in the region.

Related Article: Thailand Unveils ‘Ignite Finance’ Initiative: A Strategic Move Towards Becoming a Global Financial Hub – The Legal Co., Ltd.

Author: Panisa Suwanmatajarn, Managing Partner.

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Corporate Registration: Upcoming Changes to Verify Premises for Business Head Office Locations

The Department of Business Development (DBD) is set to introduce a new regulation requiring entrepreneurs to provide evidence of the right to use a premise as their business registered address when registering a new partnership or company, or when changing the registered address of an existing entity. Currently, the DBD only requires a map, address, and house code number (13-digit numbers) of the proposed head office location without verifying ownership or usage rights. However, this lenient approach is expected to change soon.

Reasons Behind the Regulatory Changes:

The upcoming changes aim to achieve several key objectives:

  1. Support Economic Analysis and Planning: Accurate and reliable data on business locations is essential for analyzing economic trends. This information will help both public and private sectors make informed decisions, formulate policies, and plan strategically.
  2. Drive Economic Growth: Transparent and credible business registration practices will enhance trust in Thailand’s business environment, making it more attractive to investors and contributing to national economic development.
  3. Prevent Fraud: The new requirements will deter fraudulent activities, such as unauthorized use of properties as business addresses, thereby protecting property owners and stakeholders from misuse.

Key Provisions of the New Regulation:

Under the new regulation, entrepreneurs will be required to submit the following documents to verify the right to use a premise as a head office:

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  1. Letter of Consent: A written consent from the owner or authorized user of the premises allowing the business to use the location as its registered office.
  2. House Registration Document: A copy of the house registration showing that the consent giver is the head of the household.
  3. Lease Agreement: A copy of the lease agreement if the consent giver is the lessee of the property.
  4. Other Ownership Documents: Any other document proving that the consent giver owns or has legal rights to the property.

These requirements are not entirely new in Thailand. For instance, the Revenue Department has long mandated similar documentation for value-added tax registration purposes. However, the DBD has been more relaxed until the enforcement of this new regulation.

When Will the New Regulation Take Effect?

The new regulation is scheduled to take effect starting March 1st, 2025. Businesses and entrepreneurs should prepare to comply with these requirements to avoid any disruption during the registration process.

Implications for Entrepreneurs and Stakeholders:

Entrepreneurs, directors, managing partners, and other relevant parties should take note of these upcoming changes and prepare accordingly. Ensuring compliance with the new requirements will not only prevent delays in the registration process but also contribute to greater transparency and credibility in the business ecosystem. By implementing these measures, the DBD aims to modernize corporate registration practices, align them with international standards, and create a more robust framework for supporting Thailand’s economic growth while safeguarding property rights.

Author: Panisa Suwanmatajarn, Managing Partner.

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BOI: Investment Strategy to Become a Global Digital-AI Hub and Bioeconomy Leader

The Board of Investment (BOI) has unveiled a comprehensive strategy aimed at transforming Thailand into a leading regional investment hub by focusing on five key areas that leverage the country’s strengths in innovation, sustainability, and advanced industries. These initiatives are designed to bolster Thailand’s competitiveness amid global economic uncertainties, geopolitical tensions, and climate change challenges.

Strengthening Thailand’s Position as a Regional Investment Hub:

The BOI approved three major investment projects valued at over 170 billion baht, including a TikTok data center, Siam AI cloud services, and potash production by Asia Pacific Potash Corporation. These projects underscore Thailand’s growing status as a digital and AI hub, with expectations of continued investment in Big Data and artificial intelligence. This aligns with the government’s vision of positioning Thailand as a leader in the regional digital economy.

Promoting the Bioeconomy and Sustainable Resource Utilization:

To solidify Thailand’s role as a bioeconomy leader, the BOI introduced incentives for Sustainable Aviation Fuel (SAF) production. Projects using agricultural-based SAF will receive an 8-year tax exemption, while blended SAF projects qualify for a 3-year exemption. Additionally, agricultural and food industrial parks have been reclassified as bio-industrial parks, eligible for a 5-year tax exemption under the Bio Circular Green (BCG) framework. These measures aim to add value to local resources and drive sustainable economic growth.

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Comprehensive Strategy for Growth: Five Pillars:

1. Enhancing Competitiveness in Strategic Industries:

The BOI is prioritizing investment in five high-potential sectors: bio circular green (BCG), electric vehicles (xEV), semiconductors/advanced electronics, digital technologies, and International Business Centers (IBC). To attract more foreign direct investment (FDI), the BOI plans to expand its international presence by opening new offices in Chengdu and Singapore. These efforts are complemented by targeted promotional activities and collaboration with national boards overseeing EVs, semiconductors, and soft power initiatives.

2. Supporting SMEs and Local Supply Chains:

Recognizing the critical role of small and medium-sized enterprises (SMEs), the BOI will enhance support for Thai businesses to improve production efficiency and integrate into global supply chains. Special attention will be given to the EV and electronic circuit board industries, where measures will encourage the use of locally manufactured components and foster industrial linkages.

3. Developing a Highly Skilled Workforce:

In partnership with the Ministry of Higher Education, Science, Research, and Innovation (MHESI) and private sector stakeholders, the BOI will focus on developing a skilled workforce tailored to the needs of target industries, such as semiconductors, printed circuit boards (PCBs), artificial intelligence (AI), and digital technologies. A clear roadmap will guide these efforts, alongside streamlined visa processes (LTR and Smart Visas) to attract global talent. The One-Stop Service Center for visas and work permits will also be expanded to facilitate smoother entry for foreign experts.

4. Modernizing Infrastructure and Regulatory Frameworks:

The BOI will collaborate with relevant agencies to develop critical physical and digital infrastructure, ensuring it meets the demands of growing industries. Efforts will also focus on land acquisition, regulatory reforms to remove investment barriers, and addressing the implications of the Global Minimum Tax through cooperation with the Ministry of Finance.

5. Advancing Green and Sustainable Investments:

Sustainability remains a cornerstone of the BOI’s strategy. Incentives will be provided for investments in renewable energy, recycling, and eco-friendly products. The BOI will promote the adoption of energy-efficient machinery and reduce greenhouse gas emissions. Furthermore, partnerships with the Ministry of Energy and the Energy Regulatory Commission will facilitate access to clean energy for target industries through mechanisms like Utility Green Tariffs (UGT) and Direct Power Purchase Agreements (DPPA).

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Conclusion:

These strategic initiatives mark a significant advancement in Thailand’s economic development. By prioritizing key sectors, fostering innovation, and creating a conducive investment environment, the BOI is positioning Thailand for sustained growth and an enhanced presence on the global stage. Investors and businesses are encouraged to remain informed about ongoing developments as these strategies are implemented, paving the way for Thailand to emerge as a premier investment destination in Southeast Asia.

Author: Panisa Suwanmatajarn, Managing Partner.

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International Trade: Thailand and EFTA Forge Comprehensive Free Trade Agreement for Sustainable Growth

Thailand has taken a monumental step in expanding its global trade footprint by signing a landmark Free Trade Agreement (FTA) with the European Free Trade Association (EFTA). This comprehensive agreement, signed on January 23, 2025, in Davos, Switzerland, marks Thailand’s first FTA under the current government and highlights its return to international trade negotiations after a decade-long hiatus. The deal is expected to deepen economic ties, boost trade and investment, and position Thailand as a hub for innovation and sustainable development.

Overview of the Agreement:

The Thailand-EFTA FTA is a forward-looking and modern trade pact consisting of 15 chapters, addressing contemporary trade priorities such as sustainability, intellectual property rights, and support for small and medium-sized enterprises (SMEs). The agreement underscores Thailand’s commitment to fostering inclusive and sustainable growth while strengthening its economic partnerships with advanced economies.

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Key Provisions of the Agreement:

1. Recognition of Sustainable Development:

At the heart of the FTA lies a strong emphasis on sustainable development. The agreement mandates that all parties respect and adhere to international environmental agreements and labor standards. Key features include:

  • Ensuring that measures related to environmental protection and labor rights are implemented in a manner consistent with the rights of the parties.
  • Promoting trade and investment practices that align with global sustainability goals. This provision reflects the growing importance of balancing economic growth with environmental and social responsibility.

2. Supportive Measures for Small and Medium-Sized Enterprises (SMEs):

Recognizing the critical role SMEs play in driving economic growth, the FTA includes specific provisions to ensure their inclusion and empowerment. Key commitments include:

  • Publicly disseminating information about the agreement to ensure SMEs can access its benefits.
  • Providing tools and resources to help SMEs navigate and leverage the opportunities created by the FTA. By prioritizing SMEs, the agreement aims to foster inclusive economic development and reduce barriers for smaller businesses.

3. Adoption of National Treatment (NT) and Most Favored Nation (MFN) on Intellectual Property Rights:

The FTA establishes robust protections for intellectual property rights through the principles of National Treatment (NT) and Most Favored Nation (MFN). Key aspects include:

  • Guaranteeing equal protection of intellectual property rights among all parties.
  • Ensuring that the level of protection is not less than domestic treatment or the standards outlined in the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement). These safeguards aim to create a fair and predictable environment for innovation and creativity.

4. Technical Cooperation and Capacity Building:

Beyond facilitating trade, the FTA emphasizes technical cooperation and capacity building to strengthen human and institutional capabilities. Specific areas of focus include:

  • Sanitary and phytosanitary measures.
  • Trade in goods.
  • Government procurement.
  • Additionally, the agreement establishes contact points for both parties to serve as intermediaries for technical assistance and cooperation. This ensures that all parties have the necessary tools and resources to implement the agreement effectively.
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Implementation Process:

The Thailand-EFTA FTA requires parliamentary approval and regulatory adjustments before it can be fully implemented. The commerce ministry will conduct public hearings to gather feedback from stakeholders before submitting the agreement to parliament. Implementation is expected within one year, with the agreement projected to deliver significant economic benefits shortly thereafter.

Expected Benefits:

Boost in Trade and Investment:

The FTA is expected to enhance trade flows, particularly in advanced technology sectors such as artificial intelligence (AI) and data centers.

Increased foreign direct investment (FDI) is anticipated, driven by improved market access and regulatory frameworks.

Strategic Positioning:

By partnering with EFTA nations, Thailand positions itself as a gateway for innovation and sustainable development in Southeast Asia.

The agreement could serve as a stepping stone for future FTAs with larger blocs such as the European Union (EU) and the United Arab Emirates (UAE).

Economic Diversification:

Strengthening ties with EFTA nations allows Thailand to diversify its export markets and reduce reliance on traditional trading partners.

Key Takeaways:

Historic Milestone: This is Thailand’s first FTA under the current government, marking its re-entry into global trade negotiations after a 10-year gap.

Progress: The deal was concluded within two years, showcasing the administration’s commitment to international trade.

Focus on Innovation: The FTA emphasizes collaboration in advanced technology, aligning with Thailand’s vision of becoming a regional hub for innovation.

Future Opportunities: The agreement lays the groundwork for potential FTAs with the EU and UAE, further expanding Thailand’s global trade network.

Economic Growth: With over 1 trillion baht in foreign investment last year, the FTA is expected to drive significant economic growth and job creation.

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Conclusion:

The signing of the Thailand-EFTA Free Trade Agreement represents a transformative moment in Thailand’s trade policy. By integrating sustainability, inclusivity, and innovation into its framework, the agreement sets a new standard for modern trade pacts. As Thailand moves forward with implementation, the FTA is poised to deliver tangible benefits for businesses, investors, and consumers alike, while reinforcing Thailand’s role as a key player in the global economy.deliver tangible benefits for businesses, investors, and consumers alike, while reinforcing Thailand’s role as a key player in the global economy.

Author: Panisa Suwanmatajarn, Managing Partner.

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Thailand New Draft Digital Platform Economy Act

The outbreak of the COVID-19 pandemic has significantly altered consumer behavior, leading to a surge in reliance on digital platforms for activities like shopping and food delivery. This shift has played a pivotal role in the rapid growth of the digital economy, both in Thailand and globally. Citizens have become increasingly dependent on these platforms, which offer convenience and ease in daily life. As digital platforms now cover almost every facet of modern existence, the government has recognized the need to regulate these services to ensure economic and social stability, enhance credibility, and mitigate any potential risks to the public at large.

In response to this, Thailand initially enacted the Royal Decree on the Operation of Digital Platform Service Business Subject to Prior Notification B.E. 2565 (2022) (“Royal Decree”), which regulates and imposes obligations on digital platform service operators. These operators, such as Shopee or Lazada, manage platforms that connect business users and consumers through data networks to facilitate electronic transactions. However, recognizing the evolving landscape, the Ministry of Digital Economy and Society (“MDES“) has proposed the Draft Digital Platform Economy Act B.E. …. (the “Draft Bill”), which aims to expand regulation to include a broader range of platform services not covered under the Royal Decree, also known as, digital media services.

The Draft Bill seeks to regulate various digital platform services more comprehensively, promoting fair trade, encouraging self-regulation, and supporting operators in adopting good governance principles. Below are the key aspects of the Draft Bill.

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Categorization of Digital Media Services

The Draft Bill defines Digital Media Services as any service provided over a computer network, internet system, or telecommunications network that acts as a medium between the sender and the data receiver. It categorizes these services into three types, each with distinct legal responsibilities for the operators:

  1. Mere Conduit Service: This refers to the provision of electronic data transmission services or access to an electronic communications network. Mere conduit providers are not liable for illegal activities during data transmission, as long as they can prove they neither initiated the data nor altered it in any way.
  2. Caching Service: Caching services involve temporary data storage for faster transmission. Providers are not held responsible for illegal activities, provided they meet the terms for data access and follow standard industry practices.
  3. Hosting Service: Hosting services provide data storage on behalf of users. These providers are only held accountable if they are aware of illegal content stored and fail to take action by either removing or blocking access to it.

General Obligations for Digital Media Services Platform Operators

Under the Draft Bill, platform operators are required to comply with obligations prescribed in Chapter 3 of the Draft Bill, which includes notifying the users of their rights and obligations, as well as the risks associated with using digital media services; providing a complaint resolution channel that responds within 24 hours and reports on the investigation outcome within 60 days; disclosing advertising information, publishing clear terms and conditions, as mandated by the law, and appointing a point of contact to liaise with the Electronic Transactions Development Agency (“ETDA“).

Very Large Online Platform (VLOP)

The Draft Bill introduces the concept of Very Large Online Platforms (“VLOP“). To qualify as a VLOP, a platform must meet one of the following criteria:

  1. A net income (before expenses) of over 1,000 million Baht per year from the provision of services in Thailand.
  2. More than 6 million active users per month.
  3. Poses a high risk to the economic or social security of Thailand, as determined by the ETDA.

VLOPs are subject to additional obligations, such as reporting data to the ETDA, tracking business users’ activities, suspending services for users engaged in serious illegal activities, and submitting annual transparency reports.

Core Platform Services & Gatekeepers

Chapter 5 of the Draft Bill defines core platform services and identifies platform operators that act as “gatekeepers” to other service providers. Core platform services currently include 10 types of digital media services such as online search engines, video-sharing services, cloud computing, and online advertising services, among others. A platform operator may be classified as a gatekeeper if it meets three criteria:

  1. Significant impact on the economy, with annual income (before expenses) exceeding 7 billion Baht.
  2. Serves as a critical gateway for business users to reach end users, with more than 15 million consumer users and 10,000 business users annually.
  3. Has the power to limit competition from other platform service providers, maintaining a dominant position.

Gatekeepers are subject to additional responsibilities, such as ensuring fair treatment of business users, facilitating free communication between consumers and businesses, preventing unfair practices that hinder competition, and more.

ETDA and Digital Platform Economy Committee’s Power to Enforce Data Platform’s Compliance

In order to enforce the Draft Bill effectively, the Draft Bill grants ETDA various powers to enforce compliance, including but not limited to the power to request data from platform operators to assess compliance, power to access and inspect platforms’ computer systems and physical premises if there is reasonable suspicion of illegal activities, the power to impose fines, service suspensions, or even criminal charges for severe violations.

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Regulatory Transition

To ensure a smooth transition in the enforcement of this Draft Bill from the existing Royal Decree, the Draft Bill includes a grandfather clause allowing the platform operators who have already submitted notification under the Royal Decree to be deemed to have been notified under this Draft Bill as well. Nonetheless, they are required to update their information to align with the new requirement within 120 days of its enactment. Whilst the Royal Decree shall cease to be effective on the enforcement date of this Draft Bill, the sub-ordinate regulations issued under the Royal Decree shall remain in effect for as long as they do not conflict with the Draft Bill, or the new-subordinate regulation to be issued under the Draft Bill. 

Conclusion

The Draft Bill represents a proactive step toward regulating the rapidly expanding digital economy in Thailand. By establishing clear guidelines for digital platform operators, categorizing services, and introducing additional obligations for large and influential platforms, the Draft Bill aims to foster fair competition, ensure consumer protection, and maintain economic stability. As digital platforms continue to play an integral role in modern society, this legislation will be crucial in balancing innovation with accountability, ensuring that the digital economy can thrive in a secure and sustainable manner. As such, the passage of the Draft Bill will likely have far-reaching implications, not only for platform operators but also for the broader economy and society.

Author: Panisa Suwanmatajarn, Managing Partner.

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