Corporate Law

May 2026 · CYP Attorney at Law

Author

Thailand's Department of Business Development (DBD) is no longer waiting for complaints. It is actively hunting nominee structures — and it now has the tools to find them.

If your company has a foreigner holding 49% and Thai shareholders holding 51% who carry no real money and no real control, this affects you directly. Not someday. Now.

What Changed in 2026

An AI now reads the register. Since October 2025, the DBD runs IBAS — an analytics system that cross-checks the company register against government data to flag nominee patterns. No human tip-off required.

Thai shareholders must prove their money is real. Thai shareholders in companies with foreign involvement now have to back their share payments with three months of bank statements and declare their monthly income.

You have to show up in person. Since April 2026, adding a foreign director or shareholder requires in-person verification at the DBD. A power of attorney is no longer enough.

Same address as four other companies? Red flag. Five or more companies at one address now triggers automatic scrutiny.

Why This Matters to You

Nominee arrangements are not a grey area. They are a crime under Section 36 of the Foreign Business Act. The exposure is real:

• Criminal liability — up to 3 years imprisonment and fines from THB 100,000 to 1,000,000, for both the Thai nominee and the foreigner.
• Your company — can be ordered dissolved, and assets can be seized.
• Your side agreements — the undated share transfers, the voting agreements, the powers of attorney that gave you real control. If their purpose is unlawful, they can be void.
• Your advisors — lawyers and accountants who built the structure face prosecution too.

The DBD looks at actual control — who really directs the money, the votes, and the decisions. A clean share register does not save a structure that fails this test.

What to Do — Before the DBD Asks

The rule is simple: a voluntary restructuring always beats a forced one.

1. Audit your ownership and control. Trace every shareholder to the real beneficial owner.
2. Check your Thai shareholders' source of funds. Can they show the money was theirs?
3. Review your side agreements. These are exactly what IBAS and investigators look for.
4. Know your legal routes. BOI promotion, the US Treaty of Amity, or a Foreign Business License can give legitimate foreign ownership — without criminal risk.
5. Act early. Once the DBD opens an inquiry, the decision is no longer yours.

The Bottom Line

The question is no longer if your structure gets reviewed. It is when.

If you are not certain your company would pass, find out now — while fixing it is still your choice.

This article is for general information only and is not legal advice for any specific case. For an assessment of your company's structure, consult a lawyer directly.

Corporate Law

May 2026 · CYP Attorney at Law

Author

Thailand's Department of Business Development (DBD) is no longer waiting for complaints. It is actively hunting nominee structures — and it now has the tools to find them.

If your company has a foreigner holding 49% and Thai shareholders holding 51% who carry no real money and no real control, this affects you directly. Not someday. Now.

What Changed in 2026

An AI now reads the register. Since October 2025, the DBD runs IBAS — an analytics system that cross-checks the company register against government data to flag nominee patterns. No human tip-off required.

Thai shareholders must prove their money is real. Thai shareholders in companies with foreign involvement now have to back their share payments with three months of bank statements and declare their monthly income.

You have to show up in person. Since April 2026, adding a foreign director or shareholder requires in-person verification at the DBD. A power of attorney is no longer enough.

Same address as four other companies? Red flag. Five or more companies at one address now triggers automatic scrutiny.

Why This Matters to You

Nominee arrangements are not a grey area. They are a crime under Section 36 of the Foreign Business Act. The exposure is real:

• Criminal liability — up to 3 years imprisonment and fines from THB 100,000 to 1,000,000, for both the Thai nominee and the foreigner.
• Your company — can be ordered dissolved, and assets can be seized.
• Your side agreements — the undated share transfers, the voting agreements, the powers of attorney that gave you real control. If their purpose is unlawful, they can be void.
• Your advisors — lawyers and accountants who built the structure face prosecution too.

The DBD looks at actual control — who really directs the money, the votes, and the decisions. A clean share register does not save a structure that fails this test.

What to Do — Before the DBD Asks

The rule is simple: a voluntary restructuring always beats a forced one.

1. Audit your ownership and control. Trace every shareholder to the real beneficial owner.
2. Check your Thai shareholders' source of funds. Can they show the money was theirs?
3. Review your side agreements. These are exactly what IBAS and investigators look for.
4. Know your legal routes. BOI promotion, the US Treaty of Amity, or a Foreign Business License can give legitimate foreign ownership — without criminal risk.
5. Act early. Once the DBD opens an inquiry, the decision is no longer yours.

The Bottom Line

The question is no longer if your structure gets reviewed. It is when.

If you are not certain your company would pass, find out now — while fixing it is still your choice.

This article is for general information only and is not legal advice for any specific case. For an assessment of your company's structure, consult a lawyer directly.

Dispute Resolution

May 2026 · CYP Attorney at Law

Author

Many foreign businesses and individuals come to us holding a judgment from a court in their home country. They won. The other side was ordered to pay. The defendant, or the defendant's assets, are now in Thailand. They assume enforcement is a formality.

It is not. In Thailand, that judgment is not an order you can enforce. At best, it is evidence.

The Rule That Surprises Everyone

Thailand does not recognise or directly enforce foreign court judgments. The country has no bilateral or multilateral treaty with any jurisdiction for the mutual enforcement of judgments. What this means in practice:

• You cannot take a foreign judgment to a Thai execution officer and have assets seized.
• To recover anything in Thailand, you must file a brand new lawsuit in a Thai court.
• In that new case, the foreign judgment is treated as a piece of evidence — not as a binding decision.
• The Thai court examines the matter independently, including whether the foreign judgment offends Thai public order.

In other words: you may have to litigate the whole dispute again, in Thailand, in Thai, from the beginning.

Why This Matters Before a Dispute, Not After

By the time someone reaches us with a foreign judgment in hand, their options have already narrowed. The time to think about Thai enforcement is when the contract is signed — not when the dispute is over.

This is where the choice between a foreign court and arbitration becomes critical. Thailand is a party to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards:

What to Do

If you already hold a foreign judgment: Do not assume it is worthless — but do not assume it is enough. It can carry real weight as evidence in fresh Thai proceedings. Get Thai legal advice before any limitation period runs.

If you are still negotiating the contract: Decide now how a future dispute would actually be enforced against a Thai-based party — and draft the dispute resolution clause accordingly.

The Bottom Line

A judgment is only as good as your ability to enforce it. Across borders, that is a question you answer when you draft the contract — not when you win the case.

This article is for general information only and is not legal advice for any specific case.