Thailand's Nominee Shareholder Crackdown: 118,000 Companies Under DBD Review in 2026

In May 2026, the Director-General of Thailand's Department of Business Development (DBD), Panupong Naiyanapakorn, stated it plainly: the era of nominee Thai shareholders is over. 118,000 companies with foreign participation across the country are now under review. This is not a localized sweep in Phuket, it is a nationwide enforcement campaign.

For international investors who have relied for years on nominee shareholder arrangements to sidestep the Foreign Business Act (FBA), this is a clear warning. Since January 2026, the number of high-risk company registrations has dropped by more than 60%, showing that the new control mechanisms are already having an effect. According to Nation Thailand, authorities have also flagged roughly 53,000 potentially risky corporate links and around 2,000 mule bank accounts as part of the broader investigation.

Quick Answer

• 118,000 companies with foreign shareholding (0.01-49.99%) are under DBD scrutiny

• 6,551 companies with over 50% foreign ownership are being investigated for FBA violations

• Since January 2026, high-risk registrations have fallen by 60%+

• Violators face up to 3 years in prison, fines, forced company liquidation, and deportation

• Legal alternatives include obtaining BOI Promotion or a Foreign Business License (FBL)

• Enforcement is coordinated across DBD, the Department of Special Investigation (DSI), police, and tax authorities

• Starting April 1, 2026, DBD is expected to require in-person shareholder verification for certain corporate changes involving foreign participation

Key Facts

• Phuket: around 30,000 registered companies, with about 40% having foreign shareholders, the largest cluster of grey-area structures in the country. A recent sweep reviewed over 30,000 Phuket firms and flagged more than 600 companies at risk of nominee arrangements

• Surat Thani (Koh Samui and Koh Phangan): 16,811 companies, of which 11,426 (about 68%) have foreign shareholders, the highest ratio of any province

• Krabi: 3,587 companies, 749 (20.88%) with foreign participation

• Phang Nga: 1,685 companies, 346 (20.53%) with foreign participation

• The Foreign Business Act of 1999 bars foreigners from holding more than 49% of shares in companies engaged in restricted business activities without special authorization

• DBD now requires Thai shareholders to provide documented proof of the source of funds, including bank statements and tax filings. A nominal shareholding without real capital behind it will no longer pass review

• Penalties for FBA violations include administrative fines, criminal prosecution with up to 3 years imprisonment, forced liquidation of the legal entity, and deportation of the foreign owner

• In Phuket, a separate multi-phase police operation (Operation Dismantle Foreign Nominee Network, Phase 4) has already prosecuted 16 individuals across eight raids, with 361 companies under investigation and 149 entities found holding land where foreign shareholders control more than 50%

How to Start: Step by Step

1. Audit your current corporate structure. If your Thai company relies on nominee shareholders, this needs to be identified immediately. Engage a licensed lawyer with FBA experience.

2. Review the documentation held by Thai shareholders. Each Thai co-owner should be able to provide bank statements and tax records proving a genuine source of funds for their shareholding. If such documents don't exist, the arrangement will likely be classified as nominee ownership.

3. Identify the right legal ownership mechanism. For businesses in FBA-restricted categories, there are two lawful routes: BOI Promotion (an investment license from Thailand's Board of Investment) or a Foreign Business License (FBL) issued by the Ministry of Commerce.

4. Apply for BOI Promotion if your business qualifies. BOI status allows 100% foreign ownership, tax incentives, and the right to hire foreign staff. It suits technology, manufacturing, services, and several other sectors.

5. Apply for an FBL for activities not covered by BOI. The process takes from 60 days. A minimum registered capital is required, depending on the activity, typically starting from 3 million THB.

6. Restructure your shareholder base if needed. If you choose to keep Thai partners, make sure their involvement in management and financing is genuine. Formalize a shareholders' agreement through a Thai lawyer.

7. Prepare your company for inspection. Put your accounting records, shareholder and board meeting minutes, and shareholder register in order. DBD coordinates checks with DSI and tax authorities, so mismatches between corporate and tax documentation will be discovered.

8. Get professional advice before you travel. If you're planning a trip to Thailand to inspect properties and meet with lawyers, schedule it in advance: a full structural audit can take 2-4 weeks.

FAQ

What is a nominee shareholder in Thailand?

A nominee shareholder is a Thai national who formally holds company shares but has not contributed real capital and does not participate in management. The arrangement is used to circumvent the FBA's restriction on foreign ownership above 49%. Since 2026, DBD has been actively identifying these structures.

What penalties apply for using nominee shareholders?

Up to 3 years in prison, administrative fines, forced company liquidation, and deportation of the foreign owner. Penalties can apply to both the foreign investor and the Thai nominee.

Can a foreigner own 100% of a Thai company?

Yes, through BOI Promotion or a Foreign Business License (FBL). BOI suits a range of industries and comes with additional tax benefits. FBL is issued by the Ministry of Commerce for specific business activities.

How many companies is DBD currently reviewing?

118,000 companies with foreign shareholding between 0.01% and 49.99% are under review. A further 6,551 companies with over 50% foreign ownership are undergoing deeper investigation for FBA violations.

How does DBD determine nominee ownership?

The department checks the actual source of funds used by Thai shareholders, including bank statements, tax filings, and income history. If a Thai shareholder cannot prove where the money to buy their shares came from, the ownership is treated as nominee.

Does this affect condominium ownership?

No. The Condominium Act allows foreigners to directly own up to 49% of units in a condominium building. The crackdown targets companies through which foreigners buy land, villas, or operate businesses restricted under the FBA.

How quickly can I get BOI Promotion?

BOI application review typically takes 60 to 90 business days. Document preparation can take another 2-4 weeks. It's advisable to start the process as early as possible given the intensifying enforcement environment.

What should I do if my company already uses a nominee structure?

Conduct an immediate legal audit, identify the right legalization path (BOI, FBL, or restructuring with genuine Thai partners), and begin the transition. Voluntarily bringing your structure into compliance reduces the risk of criminal prosecution.

Is the crackdown limited to resort provinces?

No. Panupong Naiyanapakorn has stated explicitly that this is a nationwide issue. Statistics from Phuket, Koh Samui, and Krabi are cited as the most illustrative examples, but enforcement is underway across the entire country.

Thailand is not closing its doors to foreign investors. It is closing loopholes. The distinction matters. Those who move to legal ownership structures now will protect their businesses and gain a real competitive edge over those still relying on nominee arrangements.

Source: Nation Thailand

Ready to invest in Thailand? Our experts will help you find the perfect property.