Key Takeaways
- Foreign ownership above 49 percent in a restricted business still needs a licence or BOI promotion. That part has not changed.
- What changed is that the Department of Business Development now asks your Thai shareholders to prove they paid for their own shares.
- Since 1 August 2026, a company with foreign shareholding under 50 percent, or a Thai-owned company with a foreign director holding signing authority, must file bank statements from every Thai shareholder.
- A genuine Thai partner passes this without difficulty. A partner who was never going to fund their stake does not.
In Detail
The rule everyone quotes
The Foreign Business Act sets out three lists of restricted business. List 1 is closed to foreign operation entirely. List 2 needs Ministerial approval. List 3, which is where most service businesses land, needs approval from the Director-General. Outside those lists and outside an exemption, a company counts as foreign once foreign shareholding passes 49 percent.1
The Act also sets a capital floor. A foreigner commencing business under the Act needs at least THB 2 million, rising to at least THB 3 million for each business that requires a Foreign Business Licence.1
Why the percentage was never the whole test
Holding 49 percent yourself and finding a Thai to hold the rest is the arrangement most people picture. If that Thai shareholder is holding shares on your behalf rather than their own, it is a nominee arrangement, and it is a criminal offence rather than a grey area.
Section 36 carries a fine of THB 100,000 to 1,000,000 and up to three years imprisonment for the Thai nominee. Section 37 adds a penalty of THB 10,000 to 50,000 per day for the foreign principal who directed the arrangement, on top of the Section 36 range. Neither penalty changed in 2026.23
What changed in 2026
Through late 2025 the Department of Business Development issued a series of orders that together shift the question from what the share register says to what the shareholders can evidence. Order 2/2568 tightened verification of Thai shareholders in companies with foreign participation. Order 3/2568 added checks against AMLO-listed individuals. Order 4/2568 required stricter review of registered office addresses. Order 5/2568 required verification of State Welfare Card holders among Thai shareholders.45
Where foreign participation is added to a company, Thai partners and directors are required to appear in person, present identification, sign a sworn statement denying nominee conduct, and declare an average monthly income. Financial trail checks on Thai shareholders have been extended to sixteen identified risk provinces.67
The trigger catches the ordinary structure
Order 2/2569 took effect on 1 August 2026, and its trigger is the part worth reading twice. It applies where foreign shareholders hold less than 50 percent of registered capital, or where a wholly Thai-held company has a foreign director with sole or joint signing authority.8910
That is an or, not an and. A 51 percent Thai, 49 percent foreign company with a foreign director who signs is caught by both limbs. This is the most common structure a Singapore owner arrives with, and a great deal of published guidance still describes the 49 percent split as if reaching it were the end of the analysis.
What you now have to be able to show
Companies meeting the trigger must file an Explanation Statement, together with bank statements from each Thai shareholder covering the three months before the share subscription. Those statements must show a withdrawal or transfer that matches the capital contribution in both amount and date. A bank certification confirming the company received the share payments is also required.910
Read plainly: the Thai shareholder must show the money left their account and arrived at the company. Someone who genuinely bought their shares has this already. Someone whose shares were paid for by the foreign partner cannot produce it.
Enforcement is not theoretical
During 2025 the DBD and the Central Investigation Bureau raided 46 locations and implicated 442 juristic persons. Registrations flagged as high nominee risk reportedly fell by around 75 percent ahead of a twenty-one agency anti-fraud pact. The Ministry of Commerce has announced a plan to inspect 46,918 entities across tourism-adjacent sectors including restaurants, e-commerce, hotels, real estate, transport, agriculture and construction.71112
**The 1 April 2026 date** commonly given for the in-person verification requirement could not be confirmed against any instrument. We found the underlying orders but not that effective date. It is unconfirmed, not contradicted.
**DBD Order 4/2568's 1 January 2026 effective date** is in the same position. The signed order is dated 15 December 2025; the effective date is widely repeated and nowhere sourced.
**The Foreign Business Act amendment is not law.** Cabinet approved it in principle on 12 May 2026 and it remains at Council of State review. It has not been gazetted. Treat any article describing liberalised categories as in force with caution. Separately, two narrower Ministerial Regulations under the Act *were* gazetted on 28 August 2026.13
What this means for you
The useful shift is in the question you ask. Not “can I find someone willing to hold 51 percent”, but “can my Thai partner evidence that they funded their stake and that they participate in the business”. Those are different questions and only the second one now survives contact with the registrar.
If your intended partner cannot answer the second, you do not have a structuring problem to solve with better paperwork. You have the wrong partner, or you need BOI promotion, which is read more.
Before you commit to a 51/49 structure
- Can each Thai shareholder produce three months of bank statements showing a transfer matching their subscription, in amount and date?
- Did the money for their shares actually come from them, and can that be traced without explanation?
- Does your Thai partner have a real commercial role you could describe to a registrar without hesitating?
- Will a foreign director hold sole or joint signing authority? That alone triggers Order 2/2569, even in a wholly Thai-owned company.
- Have you confirmed whether your actual activity sits in List 2 or List 3 at all? Some do not, and then the question does not arise.
- If any answer above is uncomfortable, price BOI promotion before you price a nominee workaround. One is a structure. The other is a criminal offence.
This article is one of twenty-four chapters. The complete guide adds six working tools: a registered-capital worksheet, an annual compliance calendar, an incorporation document checklist, a partner due-diligence checklist, a setup cost and timeline comparison, and a decision tree for choosing your structure.
Sources
13 sources for this article, 2 of them primary. Where we could not verify something, the article says so rather than estimating.
- Thailand Board of Investment (primary), www.boi.go.th
- Lexology, www.lexology.com
- LawPlus, www.lawplusltd.com
- Silk Legal, silklegal.com
- Mahanakorn Partners, mahanakornpartners.com
- The Nation Thailand, www.nationthailand.com
- The Nation Thailand, www.nationthailand.com
- Department of Business Development (primary), www.dbd.go.th
- DFDL, www.dfdl.com
- Chandler MHM, chandler.morihamada.com
- PKF Thailand, pkfthailand.asia
- PKF Thailand, pkfthailand.asia
- LawPlus, www.lawplusltd.com
This article is general information about doing business in Thailand and is not legal, tax, or financial advice. Every figure is cited with its source and its date. Thai regulation is changing quickly and rules current at publication may change without notice. Confirm anything you intend to act on with qualified Thai counsel.