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Contents
Under the Thailand Foreign Business Act, a company counts as foreign when half or more of its capital is held by foreigners. The Act's three lists treat foreign companies differently: List 1 is closed to a foreign company altogether, while List 2 and List 3 each have their own route for a foreign company to get in. Restaurants, hotels, tours and many other services foreigners want to run in Phuket sit on List 3. For a List 3 business, a foreigner can still reach 100% ownership through a Foreign Business Licence (FBL) or promotion by the Board of Investment (BOI); US nationals have a separate route, a Treaty of Amity certificate, with its own conditions and its own degree of control. Otherwise Thai shareholders must genuinely own more than half of the company with their own money.
In short
- A company is "foreign" under the Foreign Business Act B.E. 2542 (1999) when foreigners hold 50% or more of its capital. The familiar "51/49" split comes from this threshold.
- The Act has three lists. List 1 is closed to foreigners, List 2 needs Cabinet approval, and List 3, which includes hotels, restaurants, tours and language schools, needs a licence from the Director-General of the Department of Business Development (DBD).
- Full foreign ownership of a listed business depends on the activity and the conditions of the route that applies: a Foreign Business Licence, BOI promotion, or, for US nationals, the Treaty of Amity.
- The exemptions published on 28 August 2026 cover narrow services such as treasury centres and intra-group services. Hotels, restaurants, tour businesses and language schools are not among them.
- A nominee arrangement is a criminal offence under section 36 of the Act. Since 1 August 2026, DBD Order No. 2/2569 requires proof that Thai shareholders paid for their shares with their own money.
What the Foreign Business Act restricts and allows
The Thailand Foreign Business Act does not ban foreigners from doing business. It regulates foreign companies in the activities on its three lists. The first question is therefore not "how do I set up a company", but "is what I want to do on one of the lists, and which one".
The Act treats a company as foreign when non-Thai persons or entities hold half or more of its capital. A company with 49% foreign capital and 51% Thai capital is Thai for the purposes of the Act. A company with exactly 50% foreign capital is already foreign.
| List | What it covers | What a foreign company needs |
|---|---|---|
| List 1 | Businesses closed to foreigners, such as media, farming and land trading | No route for a foreign company |
| List 2 | Businesses linked to national security, arts and culture | Cabinet approval; at least 40% Thai shareholding, which the minister may reduce with Cabinet approval but not below 25%, and at least two-fifths Thai directors |
| List 3 | Services in which Thai businesses are considered not yet ready to compete, including hotels, restaurants, tour businesses and language schools | Permission from the DBD Director-General, which is the Foreign Business Licence |
So can a foreigner own 100% of a company in Thailand? Yes, when the company's business is not on any list. For a List 3 business, full ownership may also be reached through one of the three permissions described below, each under its own conditions. List 1 stays closed to a foreign company. The general rule for List 2 is Cabinet approval and at least 40% Thai shareholding, reducible to 25% with Cabinet approval; whether BOI promotion or the Treaty of Amity applies to a List 2 activity, and what foreign share it allows, has to be checked for the specific activity. The lists are broad, though: List 3 in particular includes a large group of services, and many plans in Phuket fall within it.
A foreign company also cannot own land. Section 86 of the Land Code does not allow foreigners to own land unless a treaty gives that right, and no treaty does so today. One of the exceptions the law provides for business is BOI promotion, which allows land for the promoted activity.
Our lawyers start by matching your activity to the Act's lists, because that answer decides the route, the capital, the timeline and the work permits.
The 51/49 rule and where nominee risk begins
"51/49" is not written in the Act. It is a convention that follows from the definition of a foreign company: if Thai shareholders hold more than 50% of the capital, the company is Thai and the lists do not apply to it. A Thai company with 49% foreign capital and 51% Thai capital is a common example of this structure.
This structure is lawful when the Thai shareholders are real investors. They need to pay for their shares with their own money, take part in decisions and carry the risk that goes with their stake. It becomes a nominee arrangement when the Thai names are on paper only and the foreigner provides the money and keeps the control.
The Act punishes both sides of a nominee arrangement. Section 36 covers the Thai person who holds shares on behalf of a foreigner and the foreigner who uses that person. Section 37 covers running a restricted business without a licence. Either offence carries up to three years in prison, a fine of THB 100,000 to 1,000,000, or both. If the business continues after an order to stop, the fine is THB 10,000 to 50,000 for each further day. Under section 41, directors can be personally liable. Closing the company does not end the risk, because the limitation period runs from the offence, not from the dissolution.
What the DBD checks since 1 August 2026
The DBD now asks for documents that trace the Thai shareholders' money. DBD Order No. 2/2569 was issued on 14 July 2026 and has applied since 1 August 2026. It replaced the earlier Orders No. 2/2568 (from 1 January 2026) and No. 1/2569 (from 1 April 2026). It applies to companies where foreigners hold less than 50% of the shares and to Thai-owned companies that appoint a foreign authorised director. At registration they file:
- an Investment Explanation Letter;
- three months of bank statements for each Thai shareholder, showing withdrawals that match the payment for the shares;
- the statement of the company account that received the money.
When such a company later changes its shareholders, capital or directors, it files an Investment Confirmation Letter. Companies registered before the order are not exempt: the check applies to them as soon as they file an amendment. The order is aimed at companies with foreign shareholding below 50%. It does not expressly address fully foreign-owned companies, BOI-promoted companies, Treaty of Amity companies or FBL holders, and no official guidance on them has been published yet.
Formal Thai shareholding that is actually financed and controlled for a foreigner's benefit carries nominee risk, whatever form the arrangement takes. The documents the DBD now asks for are built around exactly this question: where the Thai shareholders' money came from. We do not build structures that put a foreigner's money and control behind Thai names. We check where the Thai shareholders' money came from before the DBD does, and if the answer is unclear, we look for a lawful route instead.
What the authorities look for in a villa held through a company is covered in the article on DBD nominee checks. A typical example of how real shareholders are proven is described in a DBD check on real shareholders.
The Foreign Business Licence: when you need one
A Foreign Business Licence is the permission a foreign company needs to run a restricted business under the Act. For List 3 it is issued by the Director-General of the DBD, while a List 2 business follows a separate licensing procedure with Cabinet approval. This section covers the List 3 procedure in detail. You need an FBL when foreigners hold 50% or more of the company and its activity is on List 3, for example a restaurant, a hotel, a tour business or a language school, and when neither BOI promotion nor the Treaty of Amity applies.
The Act sets minimum capital for foreign companies. The general minimum is THB 2 million, and a business on List 2 or List 3 needs at least THB 3 million. In practice an FBL applicant plans for the higher figure, because a business that needs a licence is by definition on one of these lists.
The Act gives the authority 60 days to decide on an application and allows one extension of another 60 days. In practice the process often takes four to eight months. The decision rests with the DBD, and no one can guarantee approval.
What does a Foreign Business Licence cost in Thailand? The cost has three parts. First comes the minimum capital that the Act requires the company to have, which is separate from the costs of preparing the application. Then come the official fees, which we check with the DBD for your case before filing. Last comes our work on the application, at [price]. We agree the fee before any work starts and add no hidden charges.
A foreigner who works in the business needs the right work authorisation, just like any other foreign employee, though the capital and staff numbers that apply to a particular permit are checked separately, since exemptions and variations exist. As a planning benchmark only, the standard ratios would put a foreign company with THB 3 million of capital and two foreign employees at about THB 4 million of paid-up capital and eight Thai employees, unless an exemption applies. We plan the capital and the work permits together, so that one THB 2 million figure is not mistaken for the other. The permit rules are explained in the guide to work permits in 2026, and the registration steps in the article on how to register a Thai company.
BOI promotion: 100% foreign ownership and incentives
BOI promotion is the most generous of the three routes, but only for activities that the Board of Investment promotes. A promoted company receives a certificate under section 12 of the Foreign Business Act, which releases it from most of the Act's provisions. For the promoted activity, it offers:
- full foreign ownership of the company;
- the right to own the land the promoted activity needs, which is the main exception to the land ban for foreign companies;
- corporate income tax holidays of 3 to 13 years, depending on the category of the activity;
- exemption from the four-Thai-employees ratio for work permits, together with help with visas and permits for foreign staff.
The BOI generally expects an investment of at least THB 1 million, not counting land and working capital. The BOI decides within 40 to 90 working days, and in practice the process takes about two to four months. After approval, the foreign funds must arrive within four months, and the Thai company must be registered within six months.
Promotion comes with obligations. The company reports its progress to the BOI at six months, one year and two years. If it breaks the conditions, the BOI can revoke the promotion, and the tax saved during the holiday becomes payable for the past years.
Thailand BOI promotion works only for activities on the BOI promoted list. Whether a beach café, a small guesthouse or a villa for holiday rentals qualifies depends on the specific project and the current list. Our lawyers check the promoted list against your plan before you prepare an application, so that you do not spend months on a route that cannot work. For the permits themselves, see the page on a work permit with a lawyer.
The US Treaty of Amity
The Treaty of Amity between Thailand and the United States gives US nationals a separate route to foreign ownership. A business set up by US nationals can obtain a treaty certificate that allows it to run certain restricted businesses without a Foreign Business Licence. The certificate takes up to 30 days, which is much faster than an FBL.
The treaty has clear limits:
- it applies only to US nationals, and citizens of other countries cannot use it;
- it does not give the right to own land, because no treaty gives foreigners that right today;
- the capital needed for a work permit at a Treaty of Amity company is checked separately, and is reported to be higher than the standard test.
The treaty does not cover every activity. Our team checks your activity against the treaty before filing. If the business falls outside it, an FBL or BOI promotion may be the route instead.
What changes in 2026
Two separate events of 2026 are often confused: a set of drafts approved in principle and a regulation that is already in force. Here is what happened, in order.
Drafts approved in principle. On 12 May 2026 the Cabinet approved in principle draft amendments to the Foreign Business Act framework. They would exempt foreign trading in agricultural forward contracts on futures exchanges and eight service businesses. The drafts were sent to the Council of State for review.
Ministerial Regulation (No. 5) B.E. 2569 published. On 28 August 2026 the Royal Gazette published the Ministerial Regulation prescribing service businesses that do not require permission for foreign business operations. It removes the licence requirement for these services:
- Type 1 telecommunications services without the provider's own network;
- treasury centres;
- intra-group administrative, HR and IT services;
- intra-group domestic debt guarantees;
- securities lending and reverse repurchase transactions;
- over-the-counter derivatives and derivatives agent or dealer services;
- leasing of space for vending machines or ATMs for employees;
- petroleum drilling services under concessions.
Most of these services matter to regional headquarters and financial groups. For a business in Phuket, the main lesson is the opposite one: the regulation did not change the rules for the businesses most foreigners plan to run here.
What the exemptions do not cover
- Hotels. Hotels are not released from the Act's restrictions. A foreign-owned hotel still needs an FBL, BOI promotion or, where its conditions are met, the Treaty of Amity.
- Restaurants and cafés. They are still on List 3.
- Tour businesses. They are still restricted.
- Language schools. They are still restricted.
- Nominee arrangements. Nothing in 2026 changed section 36, and holding shares for a foreigner remains an offence.
On 14 September 2026 the Director-General of the DBD publicly called claims that hotels and restaurants had been exempted false, and said these businesses are not in the regulation at all.
What is still pending
A Royal Decree removing agricultural futures trading from the Act is expected, but it has not been published and no date has been announced. The wider reform of the Act, which would consolidate exemptions and reduce the licensing burden, is still with the Council of State, without a date for publication. In September 2026 a senator suggested allowing 100% foreign ownership where foreigners supply all the capital. This is a proposal only: there is no bill and no government response.
If someone tells you that the 28 August 2026 regulation lets a restaurant or villa business skip a Thai partner altogether, that is not correct: the regulation did not create a general exemption for these activities. Whether you can run one without a Thai partner still depends on which permission route applies to your business — an FBL, BOI promotion or, for US nationals, the Treaty of Amity.
Choosing the right route for your business
Each route answers a different question. The table compares them for a typical small or medium business.
| Thai-majority company (genuine 51/49) | Foreign Business Licence | BOI promotion | Treaty of Amity | |
|---|---|---|---|---|
| Who can use it | Anyone with real Thai partners | Any foreign company in a List 3 business | Companies in a BOI-promoted activity | US nationals only |
| Foreign share | Less than 50% | Up to 100% | Up to 100% | US-majority control, conditions checked for the activity |
| Capital or investment | Thai shareholders pay their share with their own money | At least THB 3 million for a List 2 or List 3 business | Generally from THB 1 million, excluding land and working capital | Checked separately for the activity |
| Timing | Registration and the DBD document check; timelines for any industry permit and work permits are assessed separately by activity | 60 + 60 days by law, often 4 to 8 months in practice | 40 to 90 working days, about 2 to 4 months in practice | Up to 30 days |
| Land | Subject to the Land Code tests for companies; land bought with foreign money is what the 2026 checks target | No | Yes, for the promoted activity | No |
| Work permit | Standard benchmark: THB 2 million paid-up, 4 Thai employees per foreigner | Standard benchmark: THB 2 million paid-up, 4 Thai employees per foreigner | Exempt from the 4:1 ratio | Checked separately; reported higher than the standard test |
| Main risk | Thai shares turn out to be nominee shares | Long review, and the DBD may refuse | Revocation and back taxes if conditions are broken | Activity outside the treaty |
Four Phuket scenarios
A café or restaurant. A restaurant is on List 3. Whether BOI promotion applies to your specific concept is something we check case by case. For most foreigners, the main lawful options are a foreign-owned company with an FBL, or a Thai-majority company with Thai partners who invest their own money; a US national can also check whether the Treaty of Amity covers the business. The second option still depends on registration, the DBD's document checks and the Thai partners being real investors who put in their own money. We help you weigh the options before you sign a lease for the premises.
Software development for clients abroad. The first step is to check whether your project matches a category and the conditions on the BOI promoted list. If it does, promotion can give you full ownership and other incentives tied to its conditions. If it does not, our lawyers check whether the activity is on List 3 or outside the lists altogether.
A US citizen with a consulting business. For an American, the Treaty of Amity is often the fastest route to a fully owned company. We first check that consulting in your field is within the treaty, and we check separately what capital your own work permit will need, since it is reported to be higher than the standard test.
A villa for holiday rentals. This is a scenario the 2026 checks on nominee land ownership and unlicensed hotel businesses reach directly. A foreign-owned company still cannot own the land under the villa. Renting rooms for less than 30 days generally requires a hotel licence under the Hotel Act B.E. 2547 (2004), whichever company structure you use; whether a small property qualifies for an exemption is worth confirming with the competent authority before you rely on one. Before you build anything around a villa, read about DBD nominee checks and the lawful alternatives.
For a typical timeline of a simple route, see company and work permit in six weeks, a typical situation assembled from practice.
What next
The route decides everything that follows, so the first step is an assessment of your activity against the Foreign Business Act. Our lawyers, licensed by the Lawyers Council of Thailand, compare your plan with the lists, BOI promotion and, for US clients, the treaty. Then they suggest the route and prepare the company and the work permits under the "Company + work permit" package at [price].
Describe your business in a few lines in Telegram, WhatsApp or the form on our page about company registration in Thailand. We reply within 24 hours and agree the fee before any work starts. If you want to compare options first, see opening a business in Thailand with a lawyer.
