Bangkok Plans Major Reform of Foreign Business Act

Bangkok Plans Major Reform of Foreign Business Act

BANGKOK, April 19, 2026 — Thailand is preparing a major overhaul of its Foreign Business Act to curb the use of proxy ownership structures by foreign investors, in what officials describe as the most significant review of the law in more than two decades.

The Ministry of Commerce said the reform aims to close loopholes that allow foreign entities to bypass ownership restrictions in protected sectors through nominee shareholders and complex corporate arrangements.

The Department of Business Development has begun reviewing the 1999 legislation, which restricts foreign participation in a range of industries and fully prohibits foreign ownership in several occupations.

Officials said enforcement has been weakened by cross-shareholding structures and circular ownership schemes that obscure who ultimately controls a company.

The planned amendments are expected to tighten legal definitions of foreign ownership, require greater disclosure of management changes and beneficial control, and strengthen enforcement powers.

Authorities are also considering tougher penalties, including asset seizures and new criminal charges for businesses operating without proper licences.

Current fines are often seen as too low to deter violations, with some offenders able to quickly resume operations under new structures, officials said.

Analysts said the reforms could improve investor confidence by increasing transparency and aligning Thailand’s regulatory framework more closely with international standards, while preserving protections for domestic industries.

However, companies relying on complex shareholding models may face increased scrutiny and higher compliance costs once the new rules take effect.

The ministry said consultations and legal review are continuing, with implementation timelines yet to be announced.