The Department of Business Development has joined forces with the Royal Thai Police and relevant agencies to launch continuous operations to suppress and dismantle nominee networks in tourist areas. The investigation revealed the use of Thai nationals holding shares on behalf of foreigners linked to over 50,000 companies. They plan to expand in-depth legal action and intensify ongoing crackdowns on illegal networks.
Mr. Poonphong Nainapakorn, Director-General of the Department of Business Development, Ministry of Commerce, revealed that after joining a field operation on Koh Phangan District, Surat Thani Province, on 13 May 2026, with the Prime Minister’s team to suppress the use of Thai nationals holding shares for foreigners, or nominees, along with Police General Samran Nualma, Deputy Commissioner of the Royal Thai Police for Security, who is also Director of the Center for Combating Transnational and Illegal Immigration Criminals, the police integrated forces from multiple agencies to conduct proactive operations. These aimed to crack down on foreign networks illegally conducting business in violation of Thai law. The Prime Minister assigned the Department of Business Development, as the initial agency responsible for company registration, to lead and guide other government agencies to enforce their respective authorities.
From examining company registration data in key tourist areas, it was found that companies with foreign shareholders in notable proportions include:
Koh Phangan: 3,754 companies, with foreign shareholders in 2,381 companies.
Koh Samui: 12,050 companies, with foreign shareholders in 8,213 companies.
Phuket Province: 29,646 companies, with foreign shareholders in 11,626 companies.
Pattaya (Bang Lamung District): 33,314 companies, with foreign shareholders in 19,910 companies.
Hua Hin: 4,061 companies, with foreign shareholders in 2,081 companies.
Krabi Province: 3,587 companies, with foreign shareholders in 749 companies.
Phang Nga Province: 1,685 companies, with foreign shareholders in 346 companies.
Pai District: 139 companies, with foreign shareholders in 50 companies.
Director-General Poonphong stated that they will intensify close inspections of groups exhibiting nominee behavior, especially companies granting foreigners the power of attorney as authorized directors, even if the shareholding ratio does not exceed legal limits, as well as cases where Thai nationals serve as directors or hold overlapping shares in multiple companies unusually.
Concealing foreign shareholding by having Thai nationals hold shares on their behalf, to support or jointly operate foreign businesses, is a violation of the Foreign Business Act B.E. 2542 (1999), sections 36 and 37, punishable by imprisonment of up to 3 years and fines ranging from 300,000 to 1,000,000 baht.
To sustainably prevent and solve this problem, the Department of Business Development has raised the strictness of company registration by issuing two orders effective from 1 January and 1 April 2026, requiring that
financial evidence (bank statements) must be presented. For high-risk nominee groups (foreign shareholding below 50% or foreigners as authorized directors), Thai shareholders must provide evidence to verify actual investment.
Investment confirmation letters. Directors applying for registration must submit letters confirming that all shareholders have genuinely invested and are not nominees for foreigners.
"Statistics after issuing these orders show a significant 75% reduction in high-risk legal entities suspected of being nominees. The registrar will thoroughly verify financial flows and immediately reject registrations lacking genuine investment," explained Mr. Poonphong.
. However, the Department of Business Development also maintains a balance by facilitating legitimate foreign investors conducting business in Thailand. Director-General Poonphong concluded.
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