Foreign Direct Investment: Changes in Thailand

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Written by Jo Ruitenberg.

Have there been any recent changes to the Foreign Investment rules in Thailand?

No. The Thailand government has not introduced any additional FDI restrictions in response to COVID-19. The business climate in Thailand continues to be welcoming to foreign investment. The Board of Investment (BOI) and the Thai government have launched various investment promotion schemes and policy initiatives designed to promote domestic and foreign investment in Thailand, including the Thailand 4.0 initiative and the Eastern Economic Corridor Project.

However, foreigners continue to be restricted from engaging in certain business activities pursuant to the Foreign Business Act 1999 (FBA).

A "foreigner" under the FBA is a non-Thai national, a company that is incorporated outside of Thailand or a company incorporated in Thailand with at least one-half of share capital owned by foreign individuals and/or foreign companies.

The FBA sets out the business activities in which foreign participation is either prohibited or restricted as follows:

  1. List 1 - activities that are strictly prohibited to non-nationals such as newspaper, television broadcasting, land trading, livestock farming and fisheries.
  2. List 2 – activities that concern national security or safety, or could affect arts, cultures, traditions, customs, folklore handicrafts or national resources and environment. A foreign majority-owned company may engage in these activities if Thai nationals or juristic persons hold no less than 40% of the total shares and the number of Thai directors is at least two-fifths of the total number of directors.
  3. List 3 – activities in which there are economic protections for Thai nationals, such as retail, wholesale, hotels and any kind of service business. Foreign businesses looking to undertake activities in these areas will require a Foreign Business Licence.

In June 2019, the Ministry of Commerce promulgated the Ministerial Regulation Prescribing Service Businesses Which do not Require a Foreign Business Licence (No. 4).  As a result, the following service business activities rendered to the related companies, which were previously restricted by List 3 of the FBA, are now exempted from the foreign business licence requirement:

  • the granting of a domestic loan;
  • the lease of office space with public utilities; and
  • advisory services regarding management, marketing and information technology between related juristic persons.

Certain exemptions may be available under investment promotions from the BOI, and certain multilateral or bilateral treaties to which Thailand is bound.

If yes, please provide a brief summary of the changes

Not applicable.  This note focuses on current FDI trends and possible changes to FDI rules.

What was the rationale for the changes?

Not applicable.

Are these changes temporary and if yes, when are they likely to be reviewed again? If not, are they part of a bigger reform (ie have there been any other recent developments, and are you expecting any further changes)?

Not applicable.

Are there any particular sectors that are affected the most?

Not applicable.

What is the outlook for foreign investment in Thailand?

The business climate in Thailand continues to be welcoming to foreign investment.

What it is your advice to foreign investors in Thailand?

Prior to making an investment decision, it is recommended that investors investigate the BOI's various investment promotion schemes which may exempt certain investments from foreign ownership restrictions and substantial tax and non-tax incentives may be available.

Does the Thailand Government coordinate with other government agencies, including the antitrust regulator?

Presently, there is no general coordination between Thailand government and other government agencies in relation to FDI. In relation to antitrust issues, co-operation treaties are in place to enable the Thai authorities to cooperate with their counterparts in ASEAN, Australian and New Zealand.


This publication is intended to provide a high level overview of FDI trends and regulation in Thailand. It is provided for general informational purposes only and should not be construed as legal advice. King & Wood Mallesons does not practice Thai law, and works closely with local lawyers to support our clients' needs in Thailand. We are grateful to Weerawong, Chinnavat & Partners for their co-operation on this publication.

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