Business Development Department Acts on PM's Orders to Scan Tourist Areas, Crack Down on Foreign Nominees

The Department of Business Development, working with the Tourism Authority of Thailand, is launching a comprehensive crackdown to dismantle nominee networks operating in tourist destinations and eliminate illegal business operations. A substantial number of Thai nationals have been implicated. Poonpong Nainapakarana, Director-General of the Department of Business Development at the Ministry of Commerce, announced that following a field operation in Koh Pangan District, Surat Thani Province on May 13, 2025, coordinated with the Prime Minister's office to combat the practice of Thais holding shares as nominees for foreigners, and led by General Samran Nualma, Deputy National Police Commissioner for Security and Director of the Anti-Human Trafficking and Illegal Immigration Center, multiple agencies have deployed enforcement operations to dismantle networks of foreigners illegally operating businesses in violation of Thai law. The Prime Minister assigned the Department of Business Development—the lead agency for company registration—to guide and coordinate other government agencies in carrying out their respective enforcement duties. Current data shows 3,754 registered companies on Koh Pangan with 2,381 involving foreign shareholders, 12,050 on Koh Samui with 8,213 foreign shareholders, 29,646 in Phuket with 11,626 foreign shareholders, 1,685 in Phang Nga with 346 foreign shareholders, 3,587 in Krabi with 749 foreign shareholders, 33,314 in Bang Lamung (Pattaya) with 19,910 foreign shareholders, 4,061 in Hua Hin with 2,081 foreign shareholders, and 139 in Pai with 50 foreign shareholders. The department will intensify checks on entities showing nominee characteristics, including companies where foreigners hold the highest share proportion as legally permitted but exercise signing authority binding the company. Cases involving Thai nationals appearing redundantly as shareholders or directors across multiple companies in an unusual pattern, potentially masking nominee arrangements or assisting foreigners in business as per the Foreign Business Act B.E. 2542, carry penalties of up to three years imprisonment and fines of 300,000 to 1,000,000 baht. The department will strengthen inter-agency cooperation to seriously combat nominee businesses, ensure fairness for Thai entrepreneurs, prevent disguised asset ownership, and maintain confidence in the country's economic and investment systems. As the originating agency for company registration, the department has implemented stricter registration procedures through orders effective January 1 and April 1, 2025, requiring applications involving foreign shareholders below 50 percent or foreign board members—high-risk nominee groups—to submit bank statements of Thai shareholders to verify genuine investment. Additionally, managers or directors signing registration applications must provide written confirmation that all partners and shareholders have made genuine investments, received no assistance or support from, nor engaged in nominee-style business with foreigners. Registration statistics following these orders show a reduction in high-risk business entity registrations.