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Introducing a 200% Tax Deduction Incentive for Digital Transformation of SMEs

Introduction:

As digital transformation continues to reshape business operations and competitiveness, the Thai Government has introduced a significant tax incentive aimed at encouraging small and medium-sized enterprises (SMEs) to adopt digital technologies. Pursuant to the Royal Decree Issued Under the Revenue Code (No. 802) B.E. 2569 (2026), eligible SMEs are entitled to claim a tax deduction of up to 200% of qualifying expenditures incurred for the acquisition of digital products and services.

The measure forms part of Thailand’s broader strategy to accelerate digital adoption, enhance productivity, and strengthen the competitiveness of domestic businesses in the digital economy.

Overview of the Tax Incentive:

Under the Royal Decree, qualifying SMEs may deduct eligible digital-related expenses at twice the actual amount incurred for corporate income tax purposes. The enhanced deduction applies to expenditures relating to digital products and services procured from vendors or service providers registered or certified by the Digital Economy Promotion Agency (DEPA).

The incentive covers a wide range of digital investments, including:

  • Software acquisition and licensing fees;
  • Cloud computing and digital platform services;
  • Enterprise resource planning (ERP) and business management systems;
  • Smart devices and digital hardware;
  • Digital technology consulting and implementation services;
  • Cybersecurity solutions and related digital services; and
  • Other digital products or services approved under the applicable DEPA framework.

The policy is intended to lower the effective cost of digital adoption while encouraging businesses to modernize their operations and improve efficiency.

Eligible Businesses:

To qualify for the enhanced deduction, a taxpayer must satisfy the SME criteria prescribed under the Royal Decree. Specifically, the business must:

  • Have paid-up registered capital not exceeding THB 5 million as of the end of the accounting period; and
  • Generate annual revenue not exceeding THB 30 million.

Only businesses meeting both conditions are eligible to claim the incentive.

Deduction Amount and Limitation:

Eligible expenditures may be deducted at 200% of the actual amount paid, subject to a maximum qualifying expenditure of THB 300,000.

For example, if an eligible SME incurs THB 150,000 in qualifying software or digital service expenses, it may claim a tax deduction of THB 300,000 when calculating its corporate income tax liability.

The incentive applies to qualifying expenditures incurred between 24 June 2025 and 31 December 2027.

Practical Tax Benefits:

The enhanced deduction effectively reduces the taxable profit of qualifying businesses and lowers their corporate income tax burden.

For instance, if a company purchases an eligible system for THB 300,000:

  • Under normal tax rules, the company may deduct THB 300,000 as an expense.
  • Under the Royal Decree, the company may deduct THB 600,000.

The additional THB 300,000 deduction reduces taxable income and can generate meaningful tax savings, particularly for growing businesses investing in digital infrastructure.

Beyond the immediate tax benefit, the incentive encourages SMEs to accelerate investments in technology that may improve operational efficiency, data management, customer engagement, and cybersecurity resilience.

Compliance Considerations:

Businesses seeking to utilize the incentive should carefully consider the following legal and tax compliance issues.

Verification of DEPA Registration:

The enhanced deduction is available only for qualifying purchases or services obtained from vendors and service providers that have been registered or certified under the relevant DEPA program. Businesses should conduct appropriate due diligence before entering into transactions.

Qualification of Expenditures:

Not all technology-related expenditures automatically qualify for the enhanced deduction. Businesses should review whether a particular expense falls within the categories recognized by the Royal Decree and relevant implementing regulations.

Interaction with Other Tax Incentives:

Companies receiving benefits under other incentive regimes, including Board of Investment (BOI) promotion programs or research and development tax incentives, should evaluate whether multiple incentives may be claimed concurrently and ensure compliance with any anti-double-dipping restrictions.

Policy Significance:

The introduction of the 200% tax deduction reflects Thailand’s continued commitment to promoting digital transformation among SMEs. By reducing the after-tax cost of digital investment, the Government aims to encourage broader adoption of modern technologies and strengthen the country’s digital economy.

For many SMEs, the measure presents a timely opportunity to invest in software, cloud solutions, cybersecurity systems, and digital business processes while simultaneously benefiting from substantial tax savings.

Key Takeaways:

  • Eligible SMEs with paid-up capital of not more than THB 5 million and annual revenue not exceeding THB 30 million may claim a 200% tax deduction for qualifying digital expenditures.
  • The incentive applies to expenditures on software, digital services, smart devices, cloud solutions, cybersecurity systems, and other approved digital technologies.
  • Qualifying products and services must be purchased from suppliers or service providers registered or certified by DEPA.
  • The enhanced deduction is available for expenditures incurred from 24 June 2025 through 31 December 2027.
  • The maximum qualifying expenditure eligible for the enhanced deduction is THB 300,000.
  • Businesses should maintain comprehensive supporting documentation and verify eligibility requirements before claiming the incentive.
  • The measure represents a significant opportunity for SMEs to reduce tax liabilities while accelerating digital transformation initiatives.

Author: Panisa Suwanmatajarn, Managing Partner.

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AI-Powered Assistant “Nok Krasip” Launched to Empower SME Retailers Through Digital Tools

The government has introduced “Nok Krasip” (Whispering Bird), an AI chatbot assistant integrated into the “Thung Ngern” mobile application. This forms part of the “Thai Help Thai Plus 60/40” program, designed to support small retailers and community businesses with practical digital solutions.

Program Context:

This initiative underscores efforts to strengthen the grassroots economy by equipping micro, small, and medium-sized enterprises (MSMEs) — particularly traditional shops — with accessible technology. The Thung Ngern application serves as a central platform for financial and business management, with the AI feature representing a key advancement in providing real-time insights.

Core Features of the AI Assistant:

Nok Krasip delivers user-friendly tools tailored for retailers with limited technical expertise:

•  Sales Analysis: Automatic summaries of daily sales performance, transaction trends, peak periods, and inventory suggestions.

•  Raw Material Price Monitoring: Real-time market price data for essential commodities such as meats and other inputs, drawn from official sources.

•  Cost and Profit Analysis: Simple calculations that compare input costs with selling prices to support better pricing and margin decisions.

•  Intelligent Chatbot: Instant answers to questions about the program and application functions, featuring preset options for quick navigation.

The assistant is available in Thung Ngern version 5.50.0 and higher for eligible registered users.

Legal and Regulatory Considerations:

The introduction of this AI tool carries several implications for businesses operating in the digital economy:

•  Data Privacy Compliance: Processing of sales, inventory, and transaction data requires adherence to the Personal Data Protection Act B.E. 2562 (PDPA). Platform operators should maintain clear consent mechanisms and transparent data handling practices, especially when information is shared with government entities.

•  Digital Transaction Governance: The tool supports broader goals of fair digital commerce and MSME empowerment, aligning with regulations on electronic transactions, consumer protection, and platform responsibilities.

•  Cybersecurity and Procurement Standards: Government-backed digital services typically involve cybersecurity requirements and public technology procurement rules.

•  Intellectual Property Aspects: Issues may emerge concerning ownership of AI-generated insights, underlying datasets, and developed algorithms.

Practical Guidance for Stakeholders:

•  Retailers and MSMEs: Participants should review the application’s terms of service and data policies prior to extensive use. While the AI can enhance operational efficiency, it should supplement — not substitute — professional financial advice.

•  Platform Operators and Partners: Entities involved in such ecosystems should monitor evolving rules on data governance and electronic transactions.

•  Risk Management: Businesses adopting AI tools are advised to implement robust cybersecurity protocols and include appropriate contractual safeguards regarding accuracy and liability.

Key Takeaways:

•  The AI assistant Nok Krasip provides accessible, practical tools that help small retailers analyze sales, control costs, and make informed decisions.

•  Integration into the Thung Ngern application advances digital inclusion for MSMEs participating in government support programs.

•  Stakeholders should prioritize PDPA compliance, data security, and clear policies when leveraging such government-supported AI platforms.

•  This development signals continued focus on technology-driven support for the traditional retail sector, potentially improving competitiveness and access to future financing opportunities.

This article provides general information only and does not constitute legal advice. Readers should seek qualified professional counsel for matters specific to their situation.

Author: Panisa Suwanmatajarn, Managing Partner.

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Thailand – Long-Term Commercial and Industrial Lease Regulations

Immovable Property Lease for Commercial and Industrial Purposes Act B.E. 2542 (1999)

This Act, administered by the Department of Lands, regulates long-term leasing of land and immovable property for business purposes, addressing land-related rights in a commercial and industrial context.

Background: Why changes or review are needed

The Act has been in force since May 19, 1999. A review of its implementation is required to assess its effectiveness over the intervening period. This includes examining registration statistics, application volumes, leased area sizes, and practical outcomes in facilitating investment, commerce, and industry. The evaluation identifies any limitations, obstacles, or areas where the law no longer adequately supports economic needs, such as investment promotion, land use flexibility, or alignment with current economic conditions.

Proposed changes:

The current process is an evaluation rather than a direct draft of new amendments. It gathers public and stakeholder input on the Act’s achievements and shortcomings. Potential future amendments could address issues such as lease term limits, approval processes for large areas (e.g., exceeding 100 rai), registration requirements, or enhancements to better promote investment. Note that related discussions in Thailand have included proposals to extend maximum lease terms (e.g., from 30 to 99 years in certain contexts), though the specific hearing focuses on performance assessment rather than finalized amendment text.

Necessity and preliminary Impact:

(1) It promotes investment in certain types of commerce or industry that require long-term investment and the stability of lease rights.

(2) Tenants deserves the rights to the property as if they were owners within a specified period, and ownership can be conveniently transferred.

(3) Lease rights can be transferred through inheritance, subleased, and used as collateral for loans from financial institutions, increasing property value, improving liquidity, attracting investment, and stimulating the industrial and commercial sectors of the economy.

(4) Property owners have more options for utilizing their land for economic purposes.

Status:

The matter is currently at the summary of public consultation stage, where the Department of Lands invites comments and opinions through the central law system to inform the evaluation. This step ensures transparency and stakeholder participation prior to any subsequent revisions or proposals being advanced through legislative channels.

Key takeaways:

•  The hearing supports a structured review of a key land-related commercial leasing law to ensure it remains relevant for economic development.

•  Public input is actively sought to identify strengths and areas for potential improvement.

Author: Panisa Suwanmatajarn, Managing Partner.

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Thailand’s Foreign Business Regulatory Reform: Cabinet Approves Easing of Foreign Business Restrictions in Selected Service Sectors

Background of the Current Foreign Business Law (FBL):

Thailand’s Foreign Business Act B.E. 2542 (1999), commonly referred to as the FBA, regulates foreign participation in various economic activities to protect national interests and ensure Thai nationals remain competitive in key sectors. The law categorizes restricted businesses into three lists:

•  List 1 – activities strictly prohibited to foreigners for special reasons, such as media, rice farming, forestry, and land trading.

•  List 2 – businesses related to national security, culture, and natural resources, requiring the Cabinet’s approval.

•  List 3 – encompasses a wide range of service-oriented businesses where Thai nationals are deemed not yet ready to compete fully with foreigners. These typically require obtaining a Foreign Business License (FBL) from the Department of Business Development, Ministry of Commerce.

This framework has historically required foreign investors to obtain the FBL for many service activities.

Recent Cabinet Approval for Reforms:

On May 12, 2026, the Thai Cabinet approved in principle two draft subordinate regulations under the FBL. These aim to modernize the regulatory environment by easing restrictions on certain activities where Thai businesses are now competitive or where strong sectoral oversight already exists.

Next Steps Following the Cabinet’s Approval:

The approval in principle marks an important initial step, but the reforms are not yet in effect. The following legislative key processes are required:

1.  Review and Revision — The drafts will be undergone detailed scrutiny by relevant agencies, including potential incorporation of stakeholders’ feedback.

2.  Council of State Examination — The drafts will be proceeded to the Council of State for legal review to ensure consistency with existing laws and constitutional requirements.

3.  Second Cabinet’s Approval — Following revisions by the relevant agencies, stakeholders, and the Council of State, the drafts will return to the Cabinet for final endorsement.

4.  Publication in the Royal Gazette — Once approved by the Cabinet, the drafts will be published in the Royal Gazette to become legally enforceable.

All in all, these processes are expected to take several months, if not longer, depending on the complexity of reviews and any additional consultations required. Investors should monitor official announcements for updates on the effective date.

The Eight Exempted Service Businesses:

Foreign investors can operate the following without applying for an FBL (subject to compliance with relevant sector-specific laws), once the drafts take effect:

•  Telecommunication services without their own network infrastructure.

•  Financial management or treasury center businesses.

•  Internal network administration services.

•  Domestic debt guarantee businesses.

•  Petroleum drilling services.

•  Various lending activities secured by collateral under securities and futures laws.

•  Acting as agents, brokers, advisors, or fund managers for futures contracts not covered under the Futures Exchange Act.

•  Services for leasing space to install electronic equipment and automatic vending machines.

These activities remain subject to rigorous oversight by specialized regulators, such as the National Broadcasting and Telecommunications Commission (NBTC), Bank of Thailand, Securities and Exchange Commission (SEC), and energy authorities.

Strategic Objectives and Safeguards:

The government has emphasized that these changes do not represent full liberalization. Instead, they aim to reduce unnecessary administrative burdens, eliminate overlapping regulations, attract advanced technology and expertise, and position Thailand as a regional business and services hub.

Implications for Foreign Investors:

These amendments signal a more investor-friendly stance in targeted modern sectors while maintaining the core protective framework of the FBL. Foreign businesses in exempted categories can anticipate streamlined market entry once effective, though they must still adhere to sector-specific regulations.

Key Takeaways:

•  Thailand’s FBA continues to prohibit or restrict foreign ownership in sensitive sectors via its three lists, but recent reforms ease burdens in competitive or well-regulated areas.

•  The Cabinet has approved in principle exemptions for eight service businesses and adjustments for agricultural futures trading, subject to a multi-step approval process.

•  Implementation will require several months or longer, involving Council of State review and final publication in the Royal Gazette.

•  The changes prioritize efficiency, technology transfer, and competitiveness without compromising national safeguards.

•  Foreign investors should consult legal experts to monitor developments and ensure compliance with both the updated FBL rules and industry-specific laws.

Author: Panisa Suwanmatajarn, Managing Partner.

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Revised Digital Government Standard Updates Public Sector Data Governance Framework

The Digital Government Development Agency (DGA) continues to advance digital transformation across the public sector by releasing an updated framework for data governance. This revision strengthens structured, ethical, secure, and interoperable data management practices, serving as a vital foundation for efficient public services, evidence-based policymaking, and trusted collaboration between government and the private sector.

The Announcement of the Digital Government Development Committee on Digital Government Standards Regarding the Public Sector Data Governance Framework (Revised Edition: Practical Guidelines) (Mor Dor. 6 : 2566), commonly referred to as DGF V.2.0, replaces the earlier version and introduces significantly more actionable implementation support for government agencies.

Background and Purpose of the Revision:

The update is grounded in the Digital Government Administration and Services Act B.E. 2562 (2019), which requires public agencies to adopt sound data governance practices. While the original framework (V.1.0) focused primarily on establishing theoretical foundations, the 2023 revision (Mor Dor. 6 : 2566) retains core principles while substantially expanding practical guidance based on implementation experience and agency feedback.

The revised standard is designed for a wide audience — ranging from non-IT personnel and field operators to policymakers, data analysts, and senior executives. Its main objectives include:

  • Improving data quality, security, accessibility, and usability
  • Facilitating seamless data integration and sharing across agencies
  • Advancing open government data initiatives
  • Enabling advanced analytics and data-driven decision making
  • Building public confidence through transparent, accountable, and privacy-respecting data practices

Notable enhancements include clearer definitions of key terms (such as “government agency,” “public sector data governance,” “data strategy,” “data owner,” and “data agent”), refined data classification categories (public, internal, personal, official secret, and national security data), and the addition of practical implementation tools, readiness assessments, maturity models, and real-world case studies.

Core Components of the Revised Framework:

The standard takes a comprehensive lifecycle approach to data management — from collection, processing, and storage to sharing, archiving, and disposal. It is structured in two main sections:

  1. Theoretical Foundations — Core principles of lawfulness, transparency, accountability, data quality, security, privacy protection (fully aligned with the Personal Data Protection Act — PDPA), interoperability, ethical use, and stewardship. These principles have been clarified and made more accessible.
  2. Practical Guidelines — Newly expanded content offering step-by-step implementation support, including:
    • Establishing effective data governance structures and committees
    • Defining clear roles and responsibilities (data owners, custodians, stewards, and processors)
    • Developing agency-specific data strategies, policies, and procedures
    • Metadata management, data cataloguing, and data quality control
    • Readiness assessment and progressive maturity evaluation
    • Auditing, monitoring, compliance mechanisms, and risk management
    • Practical case studies and solutions to common implementation challenges

The framework promotes integration with national platforms such as the Government Data Exchange (GDX) and the Government Data Catalog (GD Catalog), enhancing discoverability and secure data sharing.

Alignment with National Digital Infrastructure and Investment Goals:

This data governance update supports the government’s broader strategy to upgrade critical infrastructure and attract high-value investments in future-oriented industries. Recent policy announcements emphasize strengthening digital foundations alongside clean energy development to support sectors such as data centers, semiconductors, electric vehicles, artificial intelligence, smart cities, and other high-technology industries.

Robust public sector data governance provides the essential trust layer required for secure public-private partnerships, large-scale digital projects, and the responsible use of data in analytics and AI applications.

Key Takeaways for Businesses and Investors:

  • Elevated Compliance Standards: Government agencies are expected to enforce stricter requirements on data security, privacy, quality, and interoperability in all interactions, procurement processes, and partnerships.
  • New Business Opportunities: Rising demand for data governance platforms, training services, metadata tools, analytics solutions, compliance consulting, and implementation support services.
  • Smoother Collaboration: Enhanced interoperability reduces friction in government procurement, licensing, reporting, data-sharing agreements, and joint digital projects.
  • Risk Reduction: Companies that align with the new public sector benchmarks can better manage compliance risks, especially in regulated industries such as financial services, healthcare, telecommunications, and energy.
  • Innovation Enablement: Improved availability and governance of public data open new avenues for developing value-added services, open data applications, and AI-driven solutions.
  • Strategic Positioning: Early alignment with these standards strengthens competitiveness when bidding for government contracts and participating in Thailand’s expanding digital economy ecosystem.

Outlook and Recommendations:

The public sector data governance landscape continues to evolve rapidly. The DGA is expected to roll out additional supporting tools, training programs, and related standards on open data and data cataloguing.

Businesses should consider the following actions:

Explore partnership opportunities in supporting digital government transformation projects.

Benchmark internal data governance practices against the revised public sector framework, particularly when handling government data or participating in public-private initiatives.

Monitor the publication of agency-level data strategies and any forthcoming implementation guidelines.

Engage with DGA resources, workshops, and capability-building programs.

Author: Panisa Suwanmatajarn, Managing Partner.

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Bank of Thailand Proposes Stricter Documentation Requirements for Inbound Foreign Exchange Transactions

In addition to the proposed increase in the foreign income repatriation threshold under the Bank of Thailand’s relaxations to foreign exchange regulations (as outlined in our previous article, Proposed Relaxations to Foreign Exchange Regulations), the Bank of Thailand (“BOT”) has proposed measures to strengthen regulatory oversight of inbound foreign exchange transactions. These measures aim to mitigate appreciation pressure on the Thai Baht, enhance transaction transparency, and prevent the inflow of funds inconsistent with their declared sources or otherwise undesirable.

The BOT has launched a public consultation on the Draft Notification on Rules and Procedures for Foreign Exchange Transactions (Draft Rules on Verification of Inbound Foreign Exchange Transactions). The consultation period runs from 30 December 2025 to 16 January 2026, with feedback informing the final regulatory framework.

Current Regulatory Framework

Under existing rules:

  • Foreign currency may be brought into Thailand without amount limitation for conversion into Thai Baht or deposit into a foreign currency deposit (“FCD”) account.
  • Transaction participants are required only to declare the source of funds.
  • No supporting documentary evidence is currently required.

Rationale for the Draft Rules

The proposed amendments are intended to:

  • Enhance scrutiny of inbound foreign exchange transactions and align inbound controls with outbound foreign exchange rules, under which purchases or transfers of foreign currency of USD 200,000 or more (or equivalent) are subject to documentary verification unless Know Your Business (“KYB”) procedures have been applied.
  • Increase transparency in foreign exchange transactions.
  • Prevent misrepresentation of fund sources and the use of inbound transactions for non-genuine or undesirable purposes.
  • Mitigate appreciation pressure on the Thai Baht by moderating demand arising from inbound foreign exchange transactions through enhanced verification and documentation requirements.

Key Features of the Draft Rules

While inbound foreign exchange transactions remain unrestricted in terms of amount, the Draft Rules propose stricter documentary verification requirements, differentiated by the type of licensed service provider.

1. Transactions Conducted Through Commercial Banks

A. Transactions of USD 200,000 or More (or equivalent)

Commercial banks are required to verify supporting documents corresponding to the declared source of funds on a transaction-by-transaction basis.

Exception: Documentary verification may be waived for routine transactions of business customers that are well known to the bank and subject to ongoing KYB and Customer Due Diligence (“CDD”) processes.

B. Certain High-Risk Inbound Transactions

For inbound transactions that may be used for non-business-related purposes or where the source of funds is unclear, commercial banks would be required to obtain supporting documentation on a transaction-by-transaction basis, even if the customer has already undergone KYC/KYB procedures. Such transactions include, but are not limited to:

  • Proceeds from the sale of real estate
  • Proceeds from the sale of digital assets
  • Capital inflows other than direct investment or securities investment
  • Other income sources that cannot be clearly identified

C. Digital Asset-Related Proceeds

Where foreign currency is derived from the sale of digital assets, banks must additionally obtain documents evidencing either:

  • The source of the digital assets, or
  • The source of funds used to acquire such digital assets.

2. Transactions Conducted Through Non-Bank Operators

A. Transactions of USD 200,000 or More (or equivalent)

Non-bank operators would be required to verify supporting documents corresponding to the declared source of funds for every transaction, without exception.

B. Digital Asset-Related Proceeds

Supporting documents evidencing the source of the digital assets or the funds used to acquire such assets must be obtained in all cases.

C. Inbound Cash Transactions Exceeding USD 15,000 (or equivalent)

Non-bank operators must obtain the customs declaration evidencing that the cash was declared to Thai Customs authorities upon entry into Thailand.

Potential Impacts

  • High-value transaction participants and business operators not subject to ongoing KYB processes, or whose transactions fall within categories requiring enhanced scrutiny, may face increased compliance burdens, particularly in preparing and submitting supporting documentation.
  • Commercial banks and non-bank operators will bear additional compliance and operational responsibilities in verifying documents and ensuring adherence to the enhanced regulatory standards.

Conclusion

The Draft Rules represent a clear move toward stricter verification of inbound foreign exchange transactions, particularly for high-value transfers and funds derived from digital assets or non-traditional sources. Although inbound transactions remain unrestricted in amount, documentation requirements will increase significantly. Market participants should review their transaction structures and supporting documentation in advance to ensure readiness once the rules are finalized.

Author: Panisa Suwanmatajarn, Managing Partner.

Source: International Business April 2026 : Antea

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Thailand’s Proposed Updates to the Non-Preferential Certificate of Origin Framework for Exports to the United States and the European Union

The Department of Foreign Trade (DFT) is conducting a public hearing from 1 April to 15 April 2026 on a draft notification concerning the verification of product origin for the issuance of Non-Preferential Certificates of Origin (“C/O“) for exports to the United States and the European Union (the “Draft Notification“).

The Draft Notification seeks to strengthen the criteria, procedures, and verification mechanisms governing origin certification for surveillance goods in relation to C/O issuance, in alignment with prevailing international trade measures. Key objectives include reinforcing monitoring systems, enhancing inter-agency coordination, and improving the verification of high-risk goods. These measures are intended to address risks of transshipment, origin misrepresentation, and evasion of anti-dumping duties and elevated tariffs, as well as to prevent circumvention of trade measures through the misuse of C/Os in customs declarations.

Key Principles and Implementation Framework

The Draft Notification introduces a mandatory origin verification mechanism for exporters seeking to obtain C/Os for surveillance goods destined for the United States and the European Union. Under this framework, exporters intending to declare Thai origin to foreign customs authorities via a C/O are required to undergo prior origin verification of the goods with the DFT. This requirement applies to goods listed in the annex as surveillance products, comprising 9 product groups for exports to the EU and 67 product groups for exports to the United States, all of which are subject to trade measures due to risks of origin misrepresentation.

1. Verification Procedure

Exporters must submit an application for origin verification through the DFT’s electronic system, together with relevant information and supporting evidence pertaining to the production process. The DFT will assess the origin qualifications of the goods and communicate the verification results through the same system. The results will serve as supporting evidence for subsequent C/O applications and will remain valid for a period of two years.

2. Enforcement

To monitor and enforce compliance with the mechanism, the DFT is empowered to conduct on-site inspections of business premises, production facilities, and storage locations where doubt arises regarding the production process — whether before or after the issuance of a verification result — in order to verify adherence to the applicable rules of origin.

3. Revocation

The DFT is further empowered to revoke a verification result where it is established that goods have been falsely declared as originating from Thailand through the use of a C/O, or where changes in production or export information result in non-compliance with the relevant rules of origin. In such cases, the revoked verification result may no longer be relied upon for future C/O applications.

Conclusion

The Draft Notification represents a significant tightening of Thailand’s non-preferential certificate of origin regime, particularly with respect to high-risk export categories. By introducing a mandatory pre-verification mechanism supported by electronic processing, enhanced inspection powers, and revocation authority, the DFT aims to strengthen the integrity of origin certification and ensure greater compliance with international trade rules. If implemented, the measure is expected to increase regulatory scrutiny for exporters while simultaneously enhancing the credibility and transparency of Thai export documentation in key markets, namely the United States and the European Union.

Key Takeaways

The primary objective is to prevent origin misrepresentation and circumvention of trade measures.

Mandatory origin verification is required prior to the issuance of non-preferential C/Os for exports to the United States and the European Union.

The requirement applies to surveillance goods across 9 EU product groups and 67 US product groups.

Applications are submitted and processed through an electronic system, with verification results valid for two years.

The DFT retains authority to conduct on-site inspections and revoke verification results where warranted.

Author: Panisa Suwanmatajarn, Managing Partner.

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Thailand’s DBD Launches Public Hearing to Evaluate the Effectiveness of the Foreign Business Act B.E. 2542 (1999)

The Department of Business Development (“DBD”), under the Ministry of Commerce of Thailand, is currently conducting a nationwide public hearing from 30 March to 30 April 2026 (the “Public Hearing”) to evaluate the effectiveness and practical implications of the Foreign Business Act B.E. 2542 (1999) (the “FBA”) in the current economic context. The FBA, which serves as the cornerstone of Thailand’s legal framework governing foreign participation in business activities, seeks to balance the protection of Thai business operators with the promotion of foreign investment. It not only regulates market access but also ensures that foreign participation contributes to the Thai economy through job creation, technology and knowledge transfer, and an expanded range of goods and services.

The Public Hearing aims to assess whether key aspects of the current legal framework — including the definition of “foreigner,” business classifications, licensing requirements, and enforcement mechanisms — remain appropriate in today’s evolving economic environment. It also reflects the government’s commitment to keeping the law aligned with changing business practices and international obligations. Feedback gathered through this process will inform targeted amendments intended to improve legal clarity, close existing loopholes, strengthen enforcement, and streamline regulatory procedures, ultimately establishing a more balanced and effective framework that protects Thai interests while remaining conducive to foreign investment.

Scope of the Public Hearing to Assess and Revise the FBA

The Public Hearing conducted by the DBD is designed to gather stakeholder feedback on key provisions of the FBA in order to assess their effectiveness and practical suitability. The feedback collected will assist the DBD in determining whether the FBA and its subsidiary regulations function as intended, and in identifying areas where adjustments may be required to enhance clarity, compliance, and enforcement. The matters under consideration include the following:

1. Definition of “Foreigner” (Section 4): Whether the current definition provides sufficient clarity and consistency, particularly in the context of complex shareholding structures.

2. Business Classification (Section 8): The continued categorisation of business activities into three lists:

  • List 1: Business activities strictly prohibited to foreigners, covering sensitive sectors that affect Thai livelihoods.
  • List 2: Business activities affecting national security, cultural heritage, or natural resources, which require Cabinet approval.
  • List 3: Business activities in sectors where Thai operators are not yet sufficiently competitive, which require DBD approval.

3. Regulatory Framework for the Foreign Business Certificate (“FBC”) (Sections 10–12): Whether the procedures for obtaining an FBC are practical and consistent with Thai law, international treaties, and special circumstances such as those applicable to foreign-born individuals residing in Thailand.

4. Approval Criteria: Whether the requirements imposed on applicants — including legal status, absence of prohibitions, and financial standing — effectively serve the objectives of national security, economic development, and public order.

5. Compliance Requirements: Whether obligations relating to the display of licenses, reporting of material changes, and applications for replacement licenses are clear and operationally feasible for businesses.

6. Minimum Capital and Capital Injection: Whether current thresholds and timelines for capital investment remain appropriate for business operations across the different classification categories.

7. Enforcement and Penalties: The effectiveness of administrative fines and court-based penalties, including measures to address unauthorized operations and nominee arrangements.

Authorizations under the Current FBA

According to DBD data updated as of March 2026, the majority of approvals under the FBA are concentrated in Foreign Business Licenses (“FBL”) for service businesses classified under List 3. This category accounts for the highest number of approved FBLs, with figures approximately double those of the next most common category — representative offices, which was also used to classified under List 3 of the FBA (currently the representative offices category is exempted from obtaining the FBL).

By contrast, the highest number of Foreign Business Certificates (FBCs) are issued to legal and accounting service firms. These certificates are primarily obtained under the Treaty of Amity between Thailand and the United States, which grants American companies national treatment in Thailand and exempts them from many of the restrictions otherwise imposed by the FBA.

Summary and Outlook

The ongoing Public Hearing presents an important opportunity for Thailand to review and modernize the FBA. Through this process, the DBD has identified several key areas for reform, including clarifying the definition of “foreigner,” updating enforcement and penalty provisions, standardizing licensing, and registration procedures, and addressing mechanisms to prevent legal circumvention. These reforms are aimed at closing existing legal gaps and improving regulatory clarity, thereby creating a framework that effectively protects Thai business interests while remaining supportive of foreign investment.

Under the FBA, violations may result in imprisonment, fines, or both, depending on the severity of the offence and judicial discretion. To reduce the burden on the courts, Section 42 of the FBA empowers the DBD’s Director-General to impose settlement fines for certain categories of offences, enabling cases to be resolved administratively upon payment of the applicable penalties under the Criminal Code. This approach underscores the need to strengthen enforcement mechanisms while maintaining the efficiency of administrative processes.

Author: Panisa Suwanmatajarn, Managing Partner.

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Trade Competition: Multi-Sided Platforms

Overview

The rapid expansion of the digital economy—particularly in e-commerce and multi-sided platform businesses—has significantly reshaped market structures and competitive dynamics. Multi-sided platforms operate as intermediaries connecting multiple groups of users, including sellers, consumers, logistics providers, payment channels, and advertisers. While such platforms generate economic efficiencies and drive innovation, they also introduce heightened risks under competition law.

To ensure the effective enforcement of the Trade Competition Act B.E. 2560 (2017) in the digital context, the Trade Competition Commission of Thailand (“TCCT”) has issued the Guidelines on the Assessment of Monopolistic Conduct, Reduction or Restriction of Competition, and Unfair Trade Practices in Multi-Sided Platform Businesses, Digital Services, and E-Commerce Businesses (published in the Royal Gazette on 24 March 2026). These Guidelines establish a regulatory framework for evaluating platform conduct in light of evolving digital market realities.

1. Monopoly and Reduction of Competition

The Guidelines recognize the structural characteristics inherent to multi-sided platforms, particularly the presence of network effects, whereby growth on one side of the platform increases value on the other sides. This dynamic can lead to market concentration, create significant barriers to entry, and foster dependency on a limited number of dominant platforms.

In assessing whether a platform holds dominant market power, the TCCT does not rely solely on price-based indicators. Additional factors considered include:

  • Control over data and algorithms;
  • The ability to determine or influence commercial terms;
  • The degree of user dependency on the platform.

Conduct that may constitute monopolization or a reduction or restriction of competition includes predatory pricing, excessive pricing, exclusionary contractual conditions, refusal to deal, and exclusive arrangements that prevent users or business partners from engaging with competing platforms.

2. Unfair Trade Practices

Even where a platform does not qualify as a dominant operator, certain conduct may still constitute an unfair trade practice—particularly where a significant imbalance of bargaining power exists between the platform and its business users, such as small- and medium-sized sellers.

The Guidelines identify the following conduct as potentially unfair:

  • The imposition of rate parity clauses restricting sellers from offering lower prices on other platforms;
  • Charging excessive or discriminatory commission fees, advertising fees, logistics fees, or other service charges;
  • Unilateral modification of contractual terms;
  • Discriminatory product ranking, visibility reduction, or self-preferencing of the platform’s own products or affiliated businesses;
  • Arbitrary suspension or removal of seller accounts without fair and transparent procedures.

Such conduct may distort competitive conditions and undermine fairness in digital markets, even where it does not rise to the level of monopolistic abuse.

3. Multi-Sided Platform Considerations

The Guidelines underscore that multi-sided platforms differ fundamentally from traditional businesses, as they operate across multiple interdependent markets—including those for sellers, consumers, advertisers, logistics providers, and payment services.

Accordingly, the assessment of platform conduct requires an analysis of overall competitive effects across all sides of the platform, rather than a single-market approach. Particular attention is given to data-driven practices, including the use of third-party data (data leveraging), algorithm-based decision-making, ranking systems, and platform design features that may materially affect competition.

Key Takeaways

Regulators assess competitive effects across all sides of the platform, with particular focus on the use of data, algorithms, and self-preferencing practices.

Multi-sided platforms are subject to heightened competition law scrutiny due to network effects, data control, and user dependency.

Market power may exist even in the absence of direct fees, requiring assessment beyond traditional price-based indicators.

Monopolistic and exclusionary conduct—such as predatory pricing, exclusivity arrangements, or refusal to deal—may constitute a reduction or restriction of competition.

Unfair trade practices can arise independently of dominance, particularly where there is a significant imbalance of bargaining power between platforms and business users.

Author: Panisa Suwanmatajarn, Managing Partner.

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Fast-Tracking Investment in Thailand: How BOI’s “Fast Pass” Is Unlocking Growth

Introduction

Thailand’s Board of Investment (BOI) is recalibrating its investment promotion strategy in response to mounting global uncertainty. Heightened geopolitical tensions — particularly in the Middle East — are accelerating supply chain diversification and prompting multinational corporations to reassess their production footprints. Against this backdrop, Thailand is positioning itself as a “Safe and Secure Production Base” and a preferred investment destination within the region.

To address key structural bottlenecks, the BOI has introduced the “Fast Pass” system — an integrated framework designed to expedite approval processes and remove constraints that have historically impeded foreign investment. The initiative strengthens coordination with key regulatory authorities, including the Energy Regulatory Commission (ERC) and the Electricity Generating Authority of Thailand (EGAT), and focuses on three priority areas: access to reliable and clean energy, industrial land availability, and workforce readiness.

Concerted action across these pillars is intended to attract high-value industries, including electric vehicles (EVs), semiconductors, digital infrastructure, and renewable energy, while reinforcing Thailand’s standing as a resilient and competitive global manufacturing hub.

Addressing Investment Constraints Through BOI’s Fast Pass

The Fast Pass program is designed to streamline approvals and permitting processes for large-scale investment projects, reflecting Thailand’s ambition to become a “Preferred Regional Investment Destination.” The BOI has identified three strategic priorities: maintaining leadership in the EV sector through comprehensive ecosystem support and localization; accelerating semiconductor industry development to establish a high-technology manufacturing base; and advancing clean energy initiatives alongside the expansion of data center capacity to 2,000 megawatts.

In parallel, the BOI is implementing targeted reforms under the Fast Pass framework to address the three principal constraints facing foreign investors.

1. Electricity and Clean Energy

Rapid industrial expansion in the Eastern Economic Corridor (EEC) has strained power supply, particularly for high-technology and data center projects. In response, the BOI is working in close coordination with the ERC to accelerate the implementation of both near-term and long-term energy strategies.

Key measures include the pre-confirmation of electricity availability through an optimized “power map” prior to BOI application submission, the facilitation of Direct Power Purchase Agreements (PPAs) for renewable energy, and the integration of energy management frameworks developed in collaboration with the ERC and EGAT.

2. Land Zoning and Site Development

The availability of industrial land remains a critical enabler of investment; however, regulatory processes related to zoning and the conversion of public land have historically caused significant delays. Under the Fast Pass framework, the BOI is expediting reviews of industrial zones, urban plans, and relevant regulatory guidelines, while promoting the conversion of public land for industrial use within a condensed timeline of approximately one year.

In addition, new regulatory guidelines governing excavation, land reclamation, and Environmental Impact Assessments (EIAs) — effective April 2026 — are expected to streamline site preparation. Broader urban planning reforms are also underway to expand the supply of industrial land and accommodate future large-scale investments.

3. Workforce Development

The BOI has set a target of developing 20,000 skilled personnel in the semiconductor sector within five years. For BOI-promoted projects in advanced industries such as semiconductors and electronics, the Fast Pass framework mandates structured training programs for Thai workers, alongside measures to facilitate the conversion of select work permits into visa arrangements for highly skilled foreign professionals.

These initiatives support Thailand’s broader policy objectives across emerging sectors — including medical and wellness industries — while enhancing national resilience in the areas of food security, energy security, supply chain continuity, and human capital development.

To date, Fast Pass projects with a combined investment value exceeding USD 5 billion have received BOI promotion approvals, with several projects already completed and others under active monitoring. By addressing these structural constraints, the BOI is reinforcing four key pillars of national stability — food security, clean energy and electricity, supply chain resilience (spanning industries such as hard disk drives and circuit boards), and human capital — to attract risk-averse multinational investors seeking long-term certainty.

Key Takeaways for Investors

Thailand’s BOI is moving beyond conventional tax incentives to focus on resolving the real operational challenges investors encounter — a shift that makes projects easier to implement and more predictable over the long term.

1. More Coordinated and Practical Problem-Solving

The BOI is adopting a more integrated approach by simultaneously addressing critical issues such as energy supply, land availability, and workforce readiness. This coordinated strategy reduces uncertainty and enables investors to plan and execute projects with greater confidence from inception through to completion.

2. A Faster and Smoother Investment Process Through “Fast Pass”

The Fast Pass system accelerates approvals and removes major bottlenecks — particularly for large-scale projects in priority sectors such as electric vehicles, semiconductors, clean energy, and data centers.

3. A Stronger and More Resilient Manufacturing Base

Ongoing reforms in energy security, supply chain management, and workforce development are consolidating Thailand’s position as a stable, sustainable, and future-ready manufacturing hub.

Conclusion

Thailand’s BOI “Fast Pass” framework represents a meaningful strategic shift — from a purely incentive-driven model to an execution-focused approach that directly tackles key structural constraints. By streamlining regulatory processes and enhancing coordination among relevant authorities, Thailand is materially improving the ease of doing business for large-scale, high-value investments.

Through targeted reforms in energy access, land development, and workforce readiness, the Fast Pass system not only accelerates project delivery but also strengthens long-term operational certainty. These developments carry particular significance amid ongoing global supply chain realignment and elevated geopolitical risk.

In this environment, Thailand is emerging as a strategically positioned and increasingly compelling investment destination. Early engagement with the BOI — particularly regarding its Fast Pass pipeline and priority sectors — may offer investors a meaningful first-mover advantage as the country cements its role as a resilient, future-ready manufacturing hub in Southeast Asia.

Author: Panisa Suwanmatajarn, Managing Partner.

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