Thailand Passes Startup Law to Unlock Funding and Competition
Thailand's cabinet has approved a new Startup Promotion Act designed to ease fundraising and growth for eligible companies through five-year tax and regulatory benefits. The law removes legal constraints on equity management, share offering
Government spokesman Ekapop Pierpimsetr announced that the cabinet has approved the framework for a new Startup Promotion Act and ordered the Office of the Council of State to review the draft legislation. The Department of Business Development has been tasked with amending the Civil and Commercial Code and related laws to align with modern business models and fundraising practices.
The proposed law aims to remove legal constraints and build an ecosystem that fosters startup growth, which is critical for innovation, competitiveness, and economic development. Eligible startups are limited companies established within 10 years, with average revenue over the past three years not exceeding 300 million baht, no dividend payments, and no external company control. Self-certification will be filed electronically with the National Innovation Agency.
The core provisions unlock restrictions on fundraising and equity management by granting startups five-year benefits including public share offerings, debt-to-equity conversion, preference share conversion, share vesting, and employee stock ownership plans. The National Innovation Agency can provide capital through loans, equity stakes, or co-investment, and will operate as a one-stop service to coordinate benefits for foreign workers, intellectual property, tax, procurement, and other matters. Startups in deep-tech agriculture or designated sectors may qualify for extended benefits up to ten years.
The framework is optional, allowing entrepreneurs to choose whether to participate. A Startup Promotion Committee will oversee policy, strategy, and development initiatives. These measures aim to remove barriers, expand access to capital and knowledge, promote innovation, and develop Thailand's startup ecosystem to compete internationally while boosting economic growth and national competitiveness.
