125,622 Companies Screened: Thailand Shuts Down Nominee Ownership Loopholes in 2026

In a lawyer's office in Phuket sits a file: a Thai company registered in 2019, registered capital of 2 million baht, three Thai shareholders holding 51% of shares, and one foreigner holding 49%. The sole asset is land under a villa in Rawai. The Thai shareholders have not received a single dividend in six years, have never attended a shareholder meeting, and cannot explain where the money to pay for their shares came from. These are exactly the kinds of companies the Department of Business Development (DBD), under Thailand's Ministry of Commerce, is now working through in bulk.

According to DBD data, a cumulative 125,622 companies have been screened as part of the ongoing campaign against nominee property ownership. This is not the result of a single raid but an accumulated figure: an earlier stage of the same campaign had previously reported 36,277 companies. A more than threefold increase over a relatively short period signals not a new policy, but the scaling up of one already in motion.

The practical takeaway for buyers is simple. The 'Thai company with nominee shareholders' structure has stopped being a quiet grey area and has become the target of systematic, database-driven screening. If you hold land or a villa through such a structure, the risk has shifted from abstract to calendar-bound.

Quick Answer

• DBD has screened 125,622 companies for signs of nominee property ownership; an earlier publicized stage of the same campaign covered 36,277 companies.

• The legal basis is the Foreign Business Act of 1999 (FBA): Section 36 penalizes nominee arrangements with fines from 100,000 to 1,000,000 baht and up to 3 years imprisonment, plus daily fines for continued violation.

• Liability falls not only on the foreigner but also on the Thai nominee shareholders, making them vulnerable to pressure and blackmail.

• Foreigners cannot directly own land in Thailand except in rare cases (BOI promotion, or Section 96 bis of the Land Code requiring a 40 million baht investment for up to 1 rai of residential land, granted very rarely).

• Legal alternatives remain: freehold condominium ownership within the 49% foreign quota of a project's total area, and a registered 30-year lease filed with the Land Department.

• Enforcement is concentrated in provinces with high foreign property density: Phuket, Chonburi (Pattaya), Surat Thani (Koh Samui), Chiang Mai, and Bangkok.

Key Facts

• 125,622 companies have undergone DBD screening for nominee ownership red flags, according to Ministry of Commerce data reported by The Nation Thailand's property desk.

• The crackdown has also identified more than 7,000 businesses suspected of using nominee structures, concentrated mainly in real estate, tourism, and hospitality, according to Bangkok Post reporting on the enforcement drive affecting Phuket, Koh Samui, and Koh Phangan.

• Most reviews are conducted remotely: authorities analyze shareholder structure, sources of registered capital, financial filings, and the absence of genuine business activity. On-site inspections are a later stage reached by only a minority of cases.

• Red flags under review include Thai shareholders with no verifiable source of funds, zero revenue despite ownership of a high-value property asset, share transfer forms or pledges signed in favor of the foreign party, and preferred shares carrying disproportionate voting rights.

• The foreign quota in condominium projects is fixed at 49% of total residential unit area under the Condominium Act, and cannot be altered at a developer's discretion.

• The maximum registrable lease term for residential property remains 30 years. Proposals discussed in 2024-2025 to extend leases to 99 years and raise the foreign condo quota were never enacted into law and remain at the discussion stage.

• Penalties under Section 36 of the FBA are accompanied by an order to cease the violation, which in practice usually forces a sale of the asset or liquidation of the company, on a timeline set by officials rather than market conditions.

Why 'everyone does it' no longer works as an argument

For a decade, the strongest argument in favor of the nominee company structure was precisely its ubiquity: thousands of villas in Phuket and Koh Samui are set up this way, so a mass crackdown seemed unlikely. That logic held while enforcement required a human inspector, a site visit, and a paper file. Database screening has erased that assumption entirely. You cannot inspect 125,000 companies on foot, but you can filter them by algorithm using three or four parameters.

To be fair, there is a point where the risk gets overstated. The odds of a criminal case landing on your desk tomorrow remain low, only a small single-digit percentage of screened companies ever face real sanctions. The real hit doesn't come from the police, it comes at the exit of a deal. A buyer with a competent lawyer will walk away from a company showing nominee red flags, or demand a 15-25% discount. Banks won't finance it. Heirs inherit a structure that can't be sold cleanly or re-registered without questions about the origin of the shares.

The 30-year lease: what sellers don't mention

The standard villa developer pitch is '30+30+30 years.' Legally, only the first 30-year term is registrable. The renewal option is a contractual promise from the seller, and Thai courts offer no guarantee of enforcing it, especially if the leasing company has since been liquidated or changed ownership by the time renewal comes due.

Here is where I stand. If you're buying a villa priced up to 30-40 million baht for personal use or rental income with a 10-12 year payback horizon, take a registered 30-year leasehold with strong terms: the right to assign without landlord consent, the right to sublease, first right of refusal on the land, and registration of the encumbrance with the Land Department on the day of payment. It's less exciting than a company structure, but it sells without a risk discount.

If what you actually need is control over the land itself, the only durable path is a company with genuine operations: revenue, employees, taxes paid, and Thai partners with verified capital and a real economic stake. Or a BOI promotion tied to a specific project. Everything else is a deferred problem accruing interest.

When this advice doesn't apply to you: at a budget under 15 million baht, land ownership simply isn't the relevant question. A condo unit within the foreign quota gives you full freehold, is inheritable, sells in 30 days through the Land Department, and falls outside every scenario described above. Half the clients who arrive asking about company structures actually just want a condo and simply don't know the quota exists.

What to do if you already own through an existing structure

Here's the sequence if a villa is already registered under a Thai company:

1. Audit the shareholder base: who are these people, are they alive, is the source of their share payments verifiable, and do signed blank share transfer forms exist (a direct red flag).

2. Review filings from the last three years: were they filed at all, and does the villa's rental income appear as revenue.

3. Evaluate conversion options: converting the villa into a 30-year leasehold from the same company, selling to a Thai buyer with a leaseback arrangement, or building genuine operating activity into the company.

4. Calculate the tax exposure of any ownership change: transferring the asset is a transaction, not a technicality, and comes with assessed fees at the Land Department.

FAQ

What exactly is a nominee ownership scheme in Thailand?

It's a Thai company where 51% of shares formally belong to Thai nationals, but actual control and funding rest entirely with a foreigner. The company buys land because the foreigner cannot do so directly. The Foreign Business Act explicitly prohibits using Thai citizens as dummy shareholders for this purpose.

How many companies have been checked, and when did the campaign start?

According to DBD, 125,622 companies have been screened. This is a cumulative total from a program that began with targeted checks in tourist provinces; an earlier stage reported 36,277 companies.

What penalties apply to a nominee structure?

Section 36 of the FBA sets fines from 100,000 to 1,000,000 baht and up to 3 years imprisonment, plus daily fines for continued violation. Thai nominee shareholders bear equal liability with the foreign party. An order to remedy the violation is also issued, which usually forces a sale of the asset.

Can I legally buy land in Thailand as a foreigner?

Direct land ownership is closed to foreigners except in narrow cases: land under an approved BOI promotion, or Section 96 bis of the Land Code (a 40 million baht investment, up to 1 rai for residential use, rarely granted). For housing, the realistic tools are condo freehold and a registered lease.

How reliable is a 30-year lease with a renewal option?

Only the first 30-year term is registered and legally protected. Renewal is a contractual promise whose enforcement isn't guaranteed. What matters in the contract isn't the headline number of 90 years, it's the right of free assignment, subleasing, and first refusal on the land.

Will condo owners be affected by these crackdowns?

No, not if the unit was purchased within the 49% foreign quota and registered to an individual with funds transferred from abroad via a FET form. The risk applies to units bought through a Thai company in excess of the quota.

Will leases be extended to 99 years?

This was discussed in 2024-2025 alongside proposals to raise the foreign condo quota, but no law was passed. Don't plan a purchase around future liberalization, it's a political decision that has already been postponed twice.

How do I check if my company shows nominee red flags?

Look at four things: whether Thai shareholders have a verifiable source of funds, whether the company has revenue and filed financial statements, whether blank share transfer forms have been signed, and whether preferred shares carry disproportionate voting rights. Three matches out of four is a structure DBD's algorithm is likely to flag.

Source: Bangkok Post

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