BANGKOK — Thai authorities have identified 50,000 foreign-linked companies for heightened scrutiny as part of a nationwide crackdown on businesses that used Thai 'nominees' to circumvent foreign ownership laws. The effort follows inspections in tourist areas and the use of artificial intelligence to cross-check official databases.
Under Thailand's Foreign Business Act, noncitizens are generally prohibited from holding more than a 49 percent stake in local businesses. Authorities are now demanding proof that Thai citizens listed as local partners in companies hold genuine ownership stakes. Nearly 500 businesses—including beauty salons and cannabis farms—were registered by a single accounting firm and linked to foreigners who falsely listed Thai nominees as majority owners.
Thai Prime Minister Anutin Charnvirakul has pledged legal action against illegal businesses and criminal organizations using shell companies. "In cases where one person holds shares and owns over 200 companies, it is essentially selling companies, selling shells so that foreigners can go and conduct business," Anutin said. "This violates the legislative intent of the law, and it is believed that we will be able to prosecute in this regard," he added.
On the resort islands of Koh Samui and Koh Phangan, about 70 percent of the 16,800 registered legal entities are part-owned by foreigners, according to the Ministry of Commerce, which noted that foreign ownership links do not necessarily indicate illegality. Nonetheless, authorities referred 28 foreign suspects to prosecutors following investigations into fraudulently registered firms in Phuket and Surat Thani provinces. In Koh Phangan, officials confiscated 30 plots of land valued at approximately 150 million baht ($4.5 million) and arrested two Thai nationals tied to illegal companies.
Brian Ramsden, general manager of foreign affairs at Lawyers for Expats Thailand, said his firm has received more than 100 calls a day from concerned clients. "All of them fear losing their investment and being charged with a criminal case," he said. He added, "It’s always the same excuse: ‘We knew it was illegal, but the lawyers told us it’s OK.’" Ramsden also stated, "If the company is not trading, it’s a red flag." He said, "This isn’t Thailand’s fault. No one put a gun to the foreigners’ heads. They come to Thailand, and most of their common sense goes out the window." He added, "This is about the people not following the rules. This crackdown is going to be better and safer for Thailand."
Some Thai citizens have expressed concern about foreign dominance in local markets. "There are foreigners who invest in villas and convert them into Airbnbs, and once they’ve developed them, Thai people can no longer touch them price-wise," said Thong, a Thai businessman who asked to be identified only by his nickname. "It is not right for foreigners to own them completely because it means many Thai people get left behind. That’s the real problem," he said.