Business in Thailand: How Foreigners Can Own 100% of a Company in 2026

Every year, foreign entrepreneurs lose businesses they spent years building in Thailand - not because the law was against them, but because they chose the wrong ownership structure from the start. A single call from a Thai nominee demanding 5 to 20 million THB to 'return' shares they were holding on paper, and the company is no longer yours.

Thailand does allow foreigners to own 100% of a company. But only under specific conditions. The Foreign Business Act (FBA) divides business activities into those open to full foreign control and those that are not. Choosing the wrong structure is not just a financial risk - it can result in criminal liability carrying up to 3 years imprisonment.

Here is what the legal pathways look like, and how to protect your investment properly.

Quick Answer

• 100% foreign ownership is legally possible through a BOI license, export-oriented activity, Special Economic Zones, or a Foreign Business License (FBL)
• In all other cases, Thai law requires at least 51% Thai citizenship ownership
• Using nominee shareholders is a criminal offence under the FBA: up to 3 years imprisonment and fines up to 1 million THB for all parties involved
• Liability falls on both the Thai nominee and the foreign investor who permitted the arrangement
• Thailand's Department of Business Development introduced new enforcement orders in 2025 and 2026 (Order No. 2/2568 and Order No. 1/2569) requiring verifiable proof that Thai shareholders contributed capital with their own funds
• The only safe path is a valid FBA-compliant structure, the correct business activity code, and an independent audit

Key Facts

• The Foreign Business Act (FBA) is the primary law governing foreign participation in Thai business. It defines three lists of restricted activities
• BOI (Board of Investment) grants licenses allowing 100% foreign ownership in priority economic sectors: IT, manufacturing, medical technology, and digital services
• BOI-promoted companies benefit from corporate tax exemptions of up to 8 years, streamlined work permit processing, and import duty relief
• FBL (Foreign Business License), issued by the Ministry of Commerce, provides access to restricted activity categories - but approval is not guaranteed and the process is more complex than BOI
• Export activities and export-oriented manufacturing do not require a Thai partner when structured correctly
• The Eastern Economic Corridor (EEC) and other Special Economic Zones extend additional rights to foreign investors
• Foreign branch offices may operate in Thailand with the appropriate permits
• Thai authorities have flagged more than 7,000 entities suspected of using illegal nominee arrangements, with 11,426 companies flagged on Koh Phangan and Koh Samui alone - demonstrating the scale and seriousness of enforcement
• Documented court cases show nominee directors transferring company assets to personal accounts, leaving foreign investors liable for outstanding debts

How to Start: Step by Step

1. Identify your business activity under FBA classification

Verify whether your intended business falls within categories permitted for 100% foreign ownership. Export, export-oriented manufacturing, IT services, and a number of other sectors can be structured without a Thai partner. Selecting the correct TSIC activity code at this stage determines your entire legal structure going forward.

2. Assess eligibility for a BOI license

Thailand's Board of Investment actively attracts foreign capital into priority sectors. A BOI license grants the right to 100% foreign ownership, corporate tax exemptions for up to 8 years, and simplified work visa processing. Preparing the application takes 2 to 4 months, with the review process adding a further 1 to 3 months. If your business fits a promoted activity category, this is the most advantageous route.

3. Explore alternative licenses

If BOI is not applicable to your sector, assess whether an FBL through the Ministry of Commerce is available. For companies headquartered abroad, a branch office or representative office structure may be appropriate, subject to separate permit requirements.

4. Conduct Enhanced Due Diligence

If you are acquiring an existing Thai company, thorough due diligence is non-negotiable. Your audit must cover: shareholder capital structure, verified sources of paid-up capital, transaction history, any active litigation, and outstanding tax obligations. Any prior use of nominee shareholders is a serious red flag - and under the new 2025 and 2026 orders, Thai shareholders must now provide sworn declarations and verifiable fund-flow evidence proving genuine capital contribution.

5. Structure any joint venture correctly

If full foreign ownership is not available for your activity and you must work with a Thai partner, use legally protected structures: preferred shares with enhanced voting rights, shareholder agreements, and restrictions on share transfers. Every Thai shareholder must be a genuine investor with documented, verifiable sources of funds. This is now a legal requirement, not merely good practice.

6. Appoint an independent auditor

Regular independent audits are your primary protection. An auditor verifies ongoing FBA compliance, confirms the authenticity of all shareholder contributions, and provides documented evidence that the structure is legitimate.

7. Review your structure annually

Thai legislation is evolving. Enforcement of nominee regulations is intensifying, and new regulatory orders continue to be issued. Any company with foreign participation should conduct an annual compliance review to confirm alignment with current law.

FAQ

Can a foreigner own 100% of a Thai company?

Yes - if the business activity falls within categories permitted by the FBA. This includes export activities, export-oriented manufacturing, BOI-promoted sectors, FBL-licensed operations, Special Economic Zones such as the EEC, and foreign branch offices operating under proper permits.

What is a nominee shareholder and why is it dangerous?

A nominee shareholder is a Thai national who formally holds shares without contributing real capital or participating in management. This constitutes a criminal offence under the FBA, carrying up to 3 years imprisonment and fines up to 1 million THB. Both the Thai nominee and the foreign investor who permitted the arrangement face liability.

How much does a BOI license cost?

Government filing fees are minimal. The main costs are legal advisory fees and business plan preparation. Full-cycle BOI application processes are estimated at 100,000 to 500,000 THB, depending on the complexity of the project and the sector.

Which types of business are closed to foreigners in Thailand?

The FBA contains three restriction lists. Fully closed sectors include: media, agriculture, forestry, fishing, and trade in antiques. Partially restricted sectors - covering various service and retail activities - may be accessible through FBL or BOI. The specific perimeter depends on the current version of the lists as updated by the government.

How do I know if my company is using nominee arrangements?

Commission an independent audit of your shareholder capital structure. Key indicators of a nominee scheme: Thai shareholders cannot document the source of funds used to pay for shares, they play no role in management, they receive no dividends, and the foreign party effectively controls all decisions. Under new 2025-2026 orders, regulators specifically look for these patterns.

Can a foreigner open a restaurant or retail shop in Thailand?

Retail trade, wholesale trade, and food and beverage operations fall within FBA restriction lists. Achieving full foreign ownership requires either an FBL or BOI promotion if the business qualifies under priority categories. The alternative is a genuine joint venture with a Thai partner holding at least 51%, where that partner has verifiable investment participation.

What are the penalties for violating the Foreign Business Act?

Criminal penalties: up to 3 years imprisonment and fines up to 1 million THB. Additional consequences include forced company liquidation and deportation. The FBA contains explicit anti-circumvention provisions that hold foreign investors directly liable for allowing nominee structures to be used on their behalf.

Is it safe to buy an existing Thai company?

Only after completing Enhanced Due Diligence. Review ownership history, sources of paid-up capital, tax records, and any litigation. Acquiring a company that previously used a nominee structure makes the new owner a party to the FBA violation. This risk is not theoretical - Thai authorities have prosecuted buyers who inherited non-compliant structures.

What changed in 2025 and 2026 for foreign business owners?

Thailand's Department of Business Development issued Order No. 2/2568 (2025) and Order No. 1/2569 (2026), requiring sworn declarations and verifiable fund-flow evidence from Thai shareholders proving genuine capital contribution with their own funds. Previously, showing a bank balance was considered sufficient. These orders significantly raise the compliance bar for all existing structures.

Source: One Asia Lawyers

Owning a business in Thailand in 2026 demands precise understanding of the legal framework. The legal tools exist, but every situation is individual. Start by auditing your intended activity against FBA classification - it takes a few days and can save years of disputes and millions in losses.

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