The Department of Business Development is collaborating with the Internal Security Operations Command (ISOC) to announce an upgraded crackdown on "nominee Thai businesses." They have set a deadline to screen corporate front accounts, requiring Thai shareholders in foreign joint ventures to submit bank statements from the past three months, aiming to dismantle transnational grey capital networks.
Mr. Poonphong Nainapakorn, Director-General of the Department of Business Development, Ministry of Commerce. He revealed that the Department of Business Development held a meeting with Lieutenant General Natsit Kongchinaskit, Director of Coordination Center 2, Internal Security Operations Command (ISOC), and their team to coordinate efforts addressing social and economic security issues. The focus is on preventing and suppressing disguised or nominee businesses under the Foreign Business Act of 1999, which currently cause significant harm to local entrepreneurs.
As an initial measure, the Department of Business Development will use the company registration process as the frontline defense by tightening scrutiny of business registrations to prevent risky front accounts. This includes requiring Thai shareholders in foreign joint ventures to present bank statements for the past three months and upgrading digital identity verification systems to reduce the establishment of shell companies and eliminate front accounts.
According to the latest data from the Department of Business Development, there are currently 1,003,706 legal entities operating businesses in Thailand, highlighting a significant structure that requires close attention.
A deeper analysis found that 119,116 legal entities have foreign investors holding between 0.01% and 49.99%. Under the law, these remain Thai legal entities but represent an important surveillance group potentially using nominee Thai businesses to circumvent foreign business regulations.
In-depth cooperative measures will have the Department of Business Development as the central coordinator to connect and share data with relevant agencies, conducting nationwide screening of nominee businesses continuously. This aims to advance effective suppression and alleviate economic distress.
Lieutenant General Natsit Kongchinaskit, Director of Coordination Center 2, ISOC. He explained that the primary mission of Coordination Center 2, ISOC, is to maintain stability and security. They have closely monitored foreign-related issues including migrant labor, migration, illegal immigration, and nationality fraud, all of which directly affect the nation’s social security.
Additionally, ISOC pointed out narcotics issues, noting that cooperation in sharing data on legal entities involved in producing or importing precursor chemicals for drugs would greatly benefit investigations and surveillance.
This partnership combines the Ministry of Commerce’s strict registration system with ISOC’s security operations to jointly monitor, exchange information, and block foreigners who impersonate Thai nationals, seize occupations, or conduct grey area businesses to evade laws. The goal is to protect Thai entrepreneurs’ interests and safeguard the country’s long-term economic stability.
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