Since the start of 2026, Thailand has progressively tightened its oversight of foreign nominee arrangements, extending scrutiny from company registration into criminal enforcement. On 11 May 2026, the Department of Business Development (DBD) and the Department of Special Investigation (DSI) announced a joint enforcement arrangement to systematically screen companies suspected of using nominee structures. This follows the entry into force, on 1 April 2026, of a registration-stage measure — the Central Partnership and Company Registration Office Order No. 1/2569. For foreign investors operating restricted businesses through Thai-majority shareholding structures, the compliance landscape has materially changed.
Legal Basis
Section 36 of the Foreign Business Act B.E. 2542 (1999) prohibits any Thai national or juristic person from holding shares on behalf of a foreigner, or assisting or supporting a foreigner, to operate a business restricted under Lists 1 to 3 of the Act. A violation is punishable by imprisonment of up to three years, a fine of THB 100,000 to 1,000,000, or both. The court may further order the assistance to cease or the shareholding to be terminated; a violation of that order carries an additional fine of THB 10,000 to 50,000 for each day the violation continues.
The DBD–DSI Joint Enforcement Arrangement
Under the arrangement announced on 11 May 2026, the DBD screens registered companies for risk and refers high-risk cases to the DSI; matters involving assets of at least THB 100 million, or of broad impact, may be taken up by the DSI as special cases. The initial operation is piloted on Koh Samui and Koh Pha-ngan — of 11,426 companies risk-categorised, 34 have been referred to the DSI — with planned expansion to Phuket, Krabi, Phang Nga, Pattaya, and Hua Hin. Supporting measures include verification of shareholders' source of funds before registration applications are accepted for high-risk categories, and the linking of the DBD's registration database with the Central Investigation Bureau (CIB) data system for cross-checking. Separately, the Anti-Money Laundering Office (AMLO) is pursuing an amendment to designate nominee conduct as a predicate offence for money laundering, which remains at the draft stage.
The registration-stage counterpart is already in place. Order No. 1/2569 (effective 1 April 2026) introduced an Investment Confirmation Letter requirement for amendments that admit a foreign partner or authorised director, which we analyse separately (see related articles). The significance of the joint enforcement arrangement is that it connects the written undertakings made at registration to subsequent criminal investigation.
What Investors in Thailand Should Note
The focus of this enforcement wave is not newly incorporated companies but existing Thai-majority shareholding structures. Whether an arrangement amounts to a nominee structure turns on whether the Thai shareholders have genuinely contributed capital and actually participate in the business. Once the registration and enforcement databases are linked, features such as nominal shareholdings and an overlap between the shareholders' source of funds and foreign capital become easier to identify at scale. Investors should focus on the following:
- Verify Thai shareholders' genuine capital contribution — retain capital-payment records and bank statements showing each Thai shareholder paid with their own funds rather than funds advanced by the foreign party; traces of advanced funding are readily treated as evidence of a nominee arrangement.
- Assess legitimisation pathways — for restricted businesses effectively controlled by the foreign party, consider applying for BOI promotion or a Foreign Business License (FBL) to render the foreign shareholding lawful and remove the structure from the scope of Section 36.
- Prioritise high-exposure entities — companies in the pilot areas (Koh Samui, Koh Pha-ngan, and subsequent locations) or with assets reaching the DSI's THB 100 million threshold should complete a structural review first.
- Note intermediary liability — the "assisting or supporting" language of Section 36 also reaches the lawyers, accountants, and other intermediaries who design or maintain nominee structures.
Conclusion
Order No. 1/2569 and the DBD–DSI joint enforcement arrangement together form a two-tier mechanism spanning registration review and criminal enforcement, marking a shift toward systematic and sustained enforcement against nominee practices. Investors should review their existing corporate structures at an early stage and ensure they rest on genuine capital contribution and lawful licensing — BOI promotion or a Foreign Business License — rather than nominee holdings. For a discussion of your specific structure and compliance options, please contact us at business@lexcelsiam.com.
Sources
- Foreign Business Act B.E. 2542 (1999), Section 36 — BOI official English translation: https://www.boi.go.th/upload/Foreign%20Business%20Act_5dd766122ff27.pdf
- DBD Central Partnership and Company Registration Office Order No. 1/2569 (amendment-stage verification; effective 1 April 2026): https://www.dbd.go.th/storage/law/201acc68-187c-4d5d-ac7e-836329387599.pdf
- DBD–DSI joint enforcement arrangement, announced 11 May 2026.