Thailand Eases Foreign Business Rules from August 28, 2026, But Land Ownership Stays Off Limits

A lawyer in Bangkok sends a client the paperwork required to register a Thai company with foreign participation: six months of bank statements for the Thai shareholders, a written explanation of where their money came from, and a signed declaration confirming there is no nominee arrangement. The client is buying a villa in Phuket, not opening a factory. A few years ago, passports and signatures would have been enough.

That single scene captures the substance of Thailand's 2026 reform. From August 28, 2026, new ministerial regulations removed several categories of activity from the licensing requirement under the Foreign Business Act (FBA), known as the Foreign Business License (FBL). At the same time, the Ministry of Commerce tightened scrutiny of ownership structures, demanding more documentation, proof of the source of funds, and explicit confirmation that no nominee scheme is involved.

For a property buyer, what matters most is what the reform does not touch. The Land Code has not changed. Foreign individuals, and companies with substantial foreign ownership, still cannot own land in Thailand, and non-compliance can trigger criminal liability along with a forced divestment order.

Key Facts

• On August 28, 2026, new ministerial regulations took effect, exempting select business activities from the FBA's licensing lists, removing the need for a Foreign Business License (FBL) in those categories.

• Documentation requirements for FBL applications and related transactions were tightened at the same time: applicants must disclose the source of funds and confirm the absence of nominee arrangements, giving the Ministry of Commerce a clearer path to flag non-compliant structures.

• The Land Code restrictions remain fully intact: non-Thai individuals and entities with substantial non-Thai ownership still cannot own land.

• Penalties go beyond fines: violations carry criminal liability plus a forced divestment order for the asset.

• Thailand's Department of Business Development has separately been scrutinizing 36,277 foreign-linked landholding entities nationwide, with particular focus on 31,516 companies where foreign ownership sits at 49% or below, checking whether Thai shareholders invested genuine capital or simply acted as nominees.

• The condominium rule is untouched: foreigners may own no more than 49% of the total unit area in any single condominium project.

• A standard Thai company structure requires 51% Thai shareholding versus 49% foreign; attempts to bypass that balance through preferred shares with disproportionate voting rights are exactly what regulators are now hunting for.

Story and Context

The Foreign Business Act of 1999 was never about real estate. It splits the economy into three lists: activities banned to foreigners, activities requiring Cabinet approval, and activities open under license. The 1999 logic was protective: after the Asian financial crisis, Thailand was opening its capital markets but wanted to keep control over services, retail and intermediary businesses. Over a quarter century, those lists calcified into a bureaucratic relic, catching activities that posed no real threat to Thai business anymore.

The August 2026 reform clears out exactly that layer. The signal to investors is clear: bring in capital, register an operating business, hire staff. A second, quieter signal is aimed elsewhere: stop using Thai companies as a wrapper for private land ownership.

This is where a scheme that the market sold for years as a workable solution stopped working. The setup looked like this: a Thai company is formed, 51% of shares are formally held by Thai nationals (often agency staff, a driver, or a manager's relatives), the foreigner holds 49% and retains control through preferred shares or a shareholders' agreement. The company buys the land, the foreigner lives in the villa. On paper, everything looks clean. In practice, it is nominee ownership, expressly banned under both the Land Code and the nominee provisions of the FBA, where penalties under the current law reach up to three years in prison and fines of up to 1 million baht.

The first serious blow to the scheme actually landed back in 2006, when the Ministry of Commerce issued a directive requiring Thai shareholders in foreign-linked companies to document the origin of the money they contributed to share capital. The rule was never repealed but was enforced unevenly. The 2026 regulations put it back at the center of the process and add a direct declaration against nominee arrangements, a document that becomes ready-made evidence of intent if the structure is ever investigated.

The practical effect is already visible in processing times. Registering a foreign-participation structure that used to take one to two weeks now stretches to six to eight weeks if Thai shareholders cannot quickly produce bank statements. That disrupts deal timelines when a developer holds a reservation for only 30 days.

What remains fully legal. First, freehold condominium ownership within the 49% project quota, funded by money transferred from abroad in foreign currency and documented with the receiving bank's confirmation form. Second, a lease registered with the Land Department for up to 30 years, the maximum allowed under the Land Code; a developer's promise of '30+30+30' is legally just a contractual undertaking that the next landowner is not obliged to honor. Third, usufruct or superficies rights, which grant a foreigner the right to use land and to own a structure on it separately from the land itself. Fourth, land held through a genuine company, one with real operations, accounting records, staff, and Thai partners who have invested their own money. Fifth, land ownership promoted through the Board of Investment (BOI) under specific investment conditions.

Here is a practical read on the numbers. If the budget for a house with land is below roughly 15-20 million baht, the whole structure is not worth the legal and reputational cost, buying a freehold condo is simpler and safer. Above that threshold, paying for a proper structure makes sense: a registered long-term land lease combined with usufruct or superficies over the building, with direct ownership of the house itself. It costs more to set up and resells less easily than the myth of 'full ownership through a company,' but it does not collapse under scrutiny. One caveat matters here: Thai court practice on renewing 30-year leases remains uncertain, and that is the one point where the honest answer is 'there are no guarantees.'

Across the wider region, regulators are applying similar pressure: Thailand's Commerce Ministry has been reviewing records of 125,622 companies nationwide as part of its nominee crackdown, with Bangkok and Chon Buri showing the highest concentration of flagged property-linked entities. If you are traveling to sign documents, budget four to five working days rather than two: a visit to the Land Department, a bank appointment for the foreign currency transfer form, a meeting with a lawyer, and a property inspection.

Source: Kudun & Partners

FAQ

Can a foreigner own land in Thailand in 2026?

No. The Land Code keeps the ban in place even after the August 28, 2026 reform. The restriction also applies to legal entities with substantial non-Thai ownership. Violations can lead to criminal liability and a forced divestment order.

What actually changed on August 28, 2026?

Ministerial regulations removed the FBL licensing requirement for several activities on the FBA lists, including services tied to intragroup structures, treasury centers, and OTC derivatives. This is about operating businesses and services, not property ownership.

Does the classic 51/49 Thai company still work for buying a villa?

As a cover structure, no. The Ministry of Commerce now requires proof of the source of Thai shareholders' funds and a signed declaration against nominee arrangements. A company with genuine operations and Thai partners who have actually invested their own money is legal; a company that exists only to hold one plot of land is a nominee structure.

How much condominium space can foreigners own?

Up to 49% of the total unit area in a project. Once that quota is filled, the remaining option is a lease, typically for 30 years, registered with the Land Department.

What is the difference between usufruct and a lease?

A lease grants a fixed-term right of use under contract, can be registered for up to 30 years, and is harder to transfer. Usufruct can be granted for the lifetime of an individual but cannot be sold or inherited. Superficies separately secures the right to own a structure built on someone else's land, which matters for a house.

Should buyers trust the 30+30+30 lease formula?

Only the first 30 years are actually registered by law. Extensions exist only as a contractual promise, and their fate depends on the courts if the landowner changes or a dispute arises. Treat the purchase price as covering 30 years, not 90.

Are existing ownership structures being reviewed, or only new deals?

Enhanced scrutiny is tied to new FBL applications and related transactions, but the Department of Lands has also joined ownership-structure reviews. Older companies come under the spotlight whenever they carry out any registration action: changing shareholders, taking a mortgage, or selling.

What should I do if I already bought a villa through a nominee company?

Do not wait for an inspection. A sensible sequence: have a Thai lawyer audit the structure, calculate restructuring options such as converting to a registered long-term lease with superficies over the building, bring in a genuine Thai partner, or sell to a Thai buyer. Each option carries tax consequences, so run the numbers before acting, not after.

Before any land transaction in Thailand in 2026, request the corporate registry extract for the owning company and written confirmation of the source of funds for its Thai shareholders. If a seller refuses, that is not a formality, it is your future criminal exposure.

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