Foreign Business Act Thailand: What Foreigners Can and Cannot Own

Almost every question a foreign entrepreneur asks about Thailand, such as "Can I own my company?", "Do I need a Thai partner?", "Why does my lawyer keep saying 49%?", comes back to one statute: the Foreign Business Act B.E. 2542 (1999) (FBA). This guide explains how it works, which businesses it restricts, and the legal routes to majority or full foreign ownership.

1. Who counts as a "foreigner"?#

Under Section 4 of the FBA, a "foreigner" includes:

• a natural person without Thai nationality;
• a juristic person not registered in Thailand;
• a juristic person registered in Thailand in which half or more of the shares (by number, not value) are held by foreigners, or in which foreigners have invested half or more of the total capital;
• a juristic person in which half or more of the shares are held by a company that is itself foreign under the tests above.

This is why "49% foreign / 51% Thai" became the standard structure: at 49% foreign shareholding the company is Thai for FBA purposes. Note that the test counts shares, so preference-share structures that give foreigners voting control while holding fewer shares are still Thai on paper; but the DBD scrutinises them, and they are a red flag for nominee arrangements.

2. The three Lists#

The FBA annexes three Lists of activities.

List 1: Absolutely prohibited for foreigners#

Activities foreigners cannot carry out for special reasons, including newspaper and broadcasting businesses, rice farming and crop farming, animal husbandry, forestry and timber, fishing in Thai waters, extraction of Thai medicinal herbs, trading and auctioning of Thai antiques, and dealing in land.

List 2: National security, culture, natural resources#

Allowed only with Cabinet approval and Ministry of Commerce permission, and generally require at least 40% Thai shareholding and two-fifths Thai directors. Examples: production of weapons, domestic transportation by land/sea/air, trading of Thai handicrafts and antiques, sugar cane processing, salt production, mining.

List 3: Businesses where Thais are "not ready to compete"#

This is the list that matters to most foreign founders. It includes, among others:

• accounting, legal, architectural and engineering services;
• retail trading with total minimum capital under 100 million THB, or under 20 million THB per shop (List 3 (14));
• wholesale trading with minimum capital per shop under 100 million THB;
• brokerage and agency (with exceptions);
• advertising, hotel operation (excluding hotel management), sale of food and beverages, and tour operation;
• construction (with exceptions for large public-infrastructure projects);
• "other service businesses": a catch-all that covers most consulting, marketing, software services sold to Thai customers, and so on.

The catch-all means that a foreign-majority company providing almost any service in Thailand needs a licence unless an exemption applies.

3. Exemptions and carve-outs#

Ministerial regulations have removed some activities from List 3. The main ones in force are:

• intra-group services (Ministerial Regulation No. 4, 2019): domestic loans to Thai affiliates, renting office space and utilities to affiliates, and consulting on management, marketing, HR and IT to affiliates. "Affiliate" means a qualifying link, e.g. one company holding 25%+ of the other. Loans or guarantees to overseas affiliates still need a licence;
• services under contracts with state agencies and state enterprises (with conditions);
• securities, insurance and banking businesses governed by their own laws (FBA s.13 lets specific laws prevail).

New since 28 August 2026: two more Ministerial Regulations#

Two Ministerial Regulations took effect when they were published in the Royal Gazette on 28 August 2026 (NO&T Legal Update No.55, October 2026):

What did not change. The Commerce Ministry dropped software development from the draft after concerns from relevant agencies (Nation Thailand, 14 May 2026). A foreign-majority software house selling to Thai clients still needs an FBL, BOI promotion or Treaty status. A ninth item, forward trading of agricultural products on a futures exchange, needs a Royal Decree instead and was not part of the August regulations.

What the exemptions do not do. They remove only the FBA permission requirement. FBA minimum capital still applies (NO&T), and so do sector licences. Keep the documents showing why you qualify, for example the shareholding chart proving the 25% link for intra-group services.

Practical meaning for a typical founder: if your Thai company only provides back-office HR, admin or IT support to its own group, you may no longer need an FBL. If it sells those services to unrelated Thai customers, you still do.

4. Minimum capital for foreign companies#

The FBA sets minimum capital for foreign companies:

5. Routes to majority or full foreign ownership#

Route A: Foreign Business Licence (FBL)#

Apply to the DBD's Foreign Business Committee. The statutory decision period is 60 days, but in practice the process including preparation often takes several months. The applicant must explain why the business benefits Thailand (technology transfer, employment, investment). Approval is discretionary. See our dedicated FBL guide.

Route B: BOI promotion → Foreign Business Certificate#

If your project qualifies for Board of Investment promotion, the company can be 100% foreign-owned and receives a Foreign Business Certificate (FBC) rather than a licence, typically faster and with more certainty. BOI promotion also brings tax incentives and work-permit facilitation.

Route C: US–Thai Treaty of Amity#

US citizens and US-majority companies can obtain an FBC for most List 3 activities, with exceptions (communications, transport, fiduciary functions, banking with depository functions, land ownership, exploitation of land or natural resources, and domestic trade in indigenous agricultural products).

Route D: Industrial Estate Authority of Thailand (IEAT)#

Companies operating in an IEAT estate can obtain an FBC for activities permitted by IEAT.

Route E: Free trade agreements#

FTAs liberalise a few named sectors for nationals of the partner country, and the company still needs a Foreign Business Certificate. Under the Thailand–Australia FTA (TAFTA), as summarised by Australia's DFAT:

Each line carries conditions in Thailand's schedule (Annex 8), such as capital size and project type. Read the schedule for your exact activity before relying on it. ASEAN and Japan (JTEPA) commitments are narrower still. In practice few SMEs use FTA routes; the BOI or FBL routes are more common.

6. Nominee shareholders: the real risk#

Section 36 of the FBA prohibits Thai nationals or companies from helping foreigners circumvent the Act by holding shares on their behalf; the foreigner who uses nominees is equally liable. Penalties include imprisonment up to three years and/or fines of 100,000–1,000,000 THB, and a daily fine for continuing violations, plus a court order to end the arrangement; a daily fine of 10,000–50,000 THB runs until it is ended (s.36). The concealing agreement itself is void.

Enforcement has tightened since 2023, with the DBD and the Department of Special Investigation reviewing companies with high-risk profiles (foreign directors with sole signing power, Thai shareholders with no evidence of funds, preference shares stripping dividends from Thai holders). Signs that a structure may be questioned:

• Thai shareholders cannot show where their investment came from;
• the Thai shareholders are employees of the law firm that set up the company;
• shareholder agreements give foreigners call options over all Thai shares at par;
• foreign directors hold all signing authority and the Thai shareholders never attend meetings.

If you already have such a structure, take advice on regularising it through an FBL, BOI promotion, Treaty status, or genuine Thai partners.

7. Practical decision tree#

1. Is your activity on List 1? → Not possible for a foreign company.
2. Is it on List 2? → Expect at least 40% Thai shareholding and Cabinet approval; usually impractical for SMEs.
3. Is it on List 3?

• Are you a US citizen/company? → Consider the Treaty of Amity.
• Does the project qualify for BOI? → Consider BOI promotion.
• Otherwise → FBL application, or a genuine Thai-majority structure.

4. Not on any List (e.g. manufacturing for export)? → 100% foreign ownership allowed with 2 million THB capital.

8. Ongoing compliance for foreign companies#

• Keep a register of shareholders accurately reflecting nationality.
• File the annual shareholder list (Bor Or Jor 5) within 14 days after the AGM.
• Report any change in foreign shareholding that affects FBA status.
• FBL/FBC holders must comply with licence conditions (e.g. maintain capital, debt-to-equity ratio limits for some licences, annual reporting).

9. Three worked examples#

Example 1: UK software consultancy serving Thai banks. The service is an "other service" under List 3. Options: BOI promotion for software or digital services (commonly eligible), or an FBL. A 49% structure is legally possible only with genuine Thai investors. Most founders in this position choose BOI because it also brings tax incentives and simplifies work permits.

Example 2: US citizen opening a marketing agency. The Treaty of Amity allows a US-majority company to obtain a Foreign Business Certificate for advertising and consulting. Minimum capital and the usual work-permit requirements still apply.

Example 3: German manufacturer producing for export. Manufacturing is generally not on any List, so a 100% German-owned company is allowed with the 2 million THB minimum capital. BOI promotion may still be worthwhile for duty exemptions on machinery and corporate income tax holidays.

Frequently asked questions#

Is the 49% rule a law? Not exactly. The law says a company with 50% or more foreign shares is a "foreigner" subject to restrictions. 49% is simply the highest foreign share that keeps the company Thai.

Can I own a restaurant in Thailand as a foreigner? Sale of food and beverages is on List 3, so a foreign-majority restaurant company needs an FBL or another exemption.

Can a foreign company sell software or online services to Thai customers? Usually this is an "other service" under List 3. Seek specific advice; BOI promotion is often available for software and digital businesses.

What about online/export-only services? Services provided entirely to customers outside Thailand may still be performed "in Thailand" for FBA purposes. Get advice.

How long does an FBL take? Statutory 60 days after a complete application, but plan for 3–6 months end to end.

Did the 2026 reforms open up software and consulting? No. The August 2026 regulations exempt intra-group admin, HR and IT services and a few regulated sectors. Software development was removed from the draft, and consulting for unrelated Thai clients is still List 3 (21).

I'm Australian. Can I own 60% of my consultancy? Not under TAFTA. The 60% and 100% openings cover the specific sectors in the table above. General consultancy for Thai clients is not one of them, except management consulting through a regional HQ structure.

Are nominee structures common? Historically yes, but enforcement is increasing and the consequences (criminal liability and forced divestment) are serious.

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Related guides#

• Foreign Business Licence (FBL) in Thailand: Requirements, Fees and Timeline
• BOI Promotion in Thailand: Incentives, Eligibility and How to Apply
• US-Thai Treaty of Amity: How Americans Can Own 100% of a Thai Company
• Representative Office vs Branch vs Subsidiary in Thailand