Rising Risks of Nominee Shareholding — Businesses Urged to Conduct Immediate Compliance Reviews

Thailand has recently intensified its enforcement efforts, releasing a series of major announcements that have drawn the attention of foreign companies across multiple industries. Police units are dismantling cross-border financial crime networks, while the Ministry of Commerce has opened an unprecedented investigation into foreign-owned businesses.

Despite targeting different issues, both initiatives underscore the same concern: illegal operations, nominee shareholding, and unauthorized business activities are now at the center of Thailand’s regulatory crackdown.

This new regulatory momentum marks a turning point and serves as a direct warning to any enterprise planning to enter—or already operating in—the Thai market.

Nominee Shareholding Under Heightened Scrutiny

763 Foreign Companies Now Subject to Comprehensive Review

Official reports from the Ministry of Commerce indicate that:

• 763 foreign investors and companies have entered an active investigation list
• The review spans multiple regions, including Bangkok and several provinces
• Industries such as real estate, e-commerce, import–export, and professional services are included
• Two high-risk foreign business groups are already facing formal charges
• A number of cases have been transferred to the Economic Crime Suppression Division under the Foreign Business Act

What distinguishes this inspection round is the government’s clear decision to place nominee shareholding and concealed control structures at the center of enforcement. Authorities are now combining data from multiple departments to verify ownership, operational control, and financial activity—making previously hidden arrangements increasingly difficult to maintain.

Why Nominee Shareholding Has Become a Significant Compliance Risk

For many years, a portion of foreign entrepreneurs relied on Thai individuals or companies to “hold shares on their behalf” to avoid foreign-ownership limits. However, this method is classified as illegal nominee shareholding, and regulators are treating it accordingly.

Definition of Nominee Shareholding

A structure in which a Thai individual or entity holds shares or control on behalf of a foreigner to circumvent restrictions under Thai law.

Key Consequences if Identified:

• Revocation of the company’s business license
• Criminal liability for both the foreign operator and the Thai nominee
• Disruptions to customs clearance, tax filings, FDA registrations, and licensing procedures
• Higher inspection risk for sectors such as e-commerce, food, beauty, and real estate
• Potential suspension or denial of visas and work permits for foreign directors

Advances in government data systems and coordinated enforcement have fundamentally changed the risk landscape.
Arrangements that once remained undetected can now be exposed quickly, and violations that once received warnings may now result in legal action.

Recommended Actions for Foreign Businesses

Three Essential Steps for Operating Safely in Thailand

Establishing a long-term business presence in Thailand requires a clear understanding that compliance is not optional—it is the foundation of market survival.

1. Maintain a Transparent and Fully Legal Company Structure

Real ownership and actual control must align with official documentation.
Nominee arrangements, borrowed names, and informal agreements carry high legal risk.

2. Complete All Regulatory Procedures Consistently and Accurately

Industries regulated by the Thai FDA—including food, cosmetics, and supplements—face strict oversight.
Customs documents, labeling, and registration files must remain consistent across all submissions.

3. Partner With Qualified and Licensed Service Providers

Professional support helps ensure that contracts, filings, and compliance records are correct.
Any inconsistent documentation may be classified as evidence of irregular business operations.

As Thailand accelerates regulatory modernization, adherence to proper procedures has become the only reliable safeguard. Nominee structures, incomplete licensing, improper labeling, and inconsistent customs filings will no longer be overlooked.
A transparent, compliant, and well-documented operation is the only viable path for sustainable growth.