Bangkok: The Department of Business Development is intensifying its efforts in Phuket, Samui, Pattaya, and Pai to crack down on businesses suspected of using nominees. The department, in collaboration with the Royal Thai Police and other relevant agencies, has launched an operation to scrutinize corporate data in key provinces and tourist areas across the nation. This initiative follows the discovery of a high proportion of foreign shareholdings in these areas, with the aim of identifying and prosecuting businesses that are at risk of using Thai nominees.
According to Thai News Agency, Mr. Poonpong Naiyanapakorn, Director-General of the Department of Business Development, Ministry of Commerce, revealed that an examination of corporate data in major provinces and tourist cities found that Bang Lamung District (Pattaya) recorded the highest number of foreign shareholders at 19,910. This was followed by Phuket with 11,626, Koh Samui with 8,213, Koh Phangan with 2,381, and Hua Hin with 2,081. Other tourist areas such as Krabi Province, Phang Nga Province, and Pai District showed similar findings.
Initially, the department will expedite investigations into companies that might be nominee entities. This includes companies where foreigners hold the maximum legally permitted percentage of shares but possess the authority to sign binding agreements on behalf of the company. Additionally, cases where Thai nationals hold shares or serve as directors in multiple companies will be scrutinized as potential concealment of shareholding on behalf of foreigners.
Mr. Poonpong stated that such actions might constitute an offense under the Foreign Business Act B.E. 2542 (1999), Sections 36 and 37. These sections are punishable by imprisonment for up to 3 years and a fine ranging from 300,000 to 1,000,000 baht.
The Department of Business Development has been designated as the primary agency responsible for identifying legal entities to security and law enforcement agencies. This information is used to expand investigations into business networks potentially violating Thai law, in collaboration with the Royal Thai Police and other relevant agencies, following a joint field visit to Koh Phangan District, Surat Thani Province.
Simultaneously, the department has enhanced its screening measures for high-risk legal entities, starting from the registration stage. Companies with less than 50% foreign ownership or with foreign nationals serving as authorized directors are required to submit bank statements of Thai shareholders to verify genuine investment. Moreover, directors or partners must sign a confirmation stating that all shareholders or partners have invested and paid for the investment, and that no assistance or support for business operations is provided through nominees.
These measures, effective from January 1st and April 1st, 2026, have already reduced the number of high-risk legal entities established by approximately 75%. Going forward, scrutiny of shareholders' financial transactions will be tightened, and the registrar can immediately reject registration if no actual investment is found.
The Department of Business Development confirmed its commitment to integrating cooperation with all agencies in combating nominee businesses and disguised business ownership. Simultaneously, it aims to facilitate foreign investors in conducting business legally in Thailand, to maintain economic confidence and ensure fair competition.