For many years, the incorporation of Thai companies was regarded primarily as a routine compliance exercise. While Thai law has long prohibited nominee arrangements under the Foreign Business Act (FBA) and related legislation, substantive scrutiny of ownership structures often occurred only after incorporation, usually through targeted audits or sector-specific enforcement initiatives.
That posture shifted on 1 January, 2026.
With the issuance of DBD Instruction No. 2/2568, the Department of Business Development (DBD) has embedded a structured evidentiary review into the registration process. The requirement that certain Thai shareholders provide three months of bank statements before a capital contribution shifts verification from a reactive model to a front-end screening mechanism.
In practice, registration is no longer purely administrative. It now includes elements of funding verification, particularly for Thai-majority structures with foreign participation.
From Form Review to Funding Review: What Changed?
Historically, the registrar’s role centered on formal completeness—prescribed forms, signatures, and statutory declarations.
Under the new instruction, the registrar must examine documentary evidence of shareholder funding capacity at the time of filing. The requirement for a 90-day funding history establishes a defined evidentiary threshold.
Specifically, Thai shareholders must provide bank statements covering the three months preceding the capital payment date, and those statements must show withdrawals or transfers that match the amount and date of the capital contribution.
For partners with established and transparent banking histories and well-structured joint ventures, the requirement is largely documentary. For incorporations structured without advance capital preparation, it introduces a meaningful planning obligation.
Practical Note: The bank statement must show a withdrawal or transfer that matches both the amount and the date of the capital contribution. A sufficient account balance alone may not meet the requirement.
This instruction does not change foreign ownership limits under the FBA. However, it strengthens the registrar’s ability to assess whether declared shareholding structures are supported by demonstrable financial capacity.
Structural Triggers for Enhanced Scrutiny
The instruction applies to limited companies and registered partnerships in the following cases:
- Foreign shareholding is present but remains below 50% of the registered or invested capital;
- A foreign director has authority to bind the entity, whether sole or joint (even in the absence of foreign shareholding).
The inclusion of foreign signing authority reflects DBD’s recognition that effective control may arise through governance authority and signing power, not solely through equity percentages.
For structures with 50% or more foreign ownership, the specific bank statement requirement under Clause 2 does not apply. However, such entities remain subject to Foreign Business Act licensing requirements, Board of Investment (BOI) approvals, and other applicable regulatory review mechanisms.
Old vs. New: A Practical Comparison
| Aspect | Pre-2026 (Old Process) | Post-2026 (Under DBD Instruction No. 2/2568) |
| Scrutiny Timing | Primarily post-incorporation review | Front-end evidentiary review at registration |
| Key Evidence | Forms, declarations, signatures | 3-month bank statements showing matching transactions |
| Applicability | Broad but reactive | Triggered where foreign ownership is <50% or foreign signing authority exists |
| Regulatory Focus | Formal compliance | Verification of funding substance |
Conclusion: Substance as a Registration Standard
The instruction does not amend Thailand’s foreign ownership regime. It does not introduce new equity thresholds. It does not retroactively affect existing companies.
Ownership form alone is no longer sufficient. Documentary evidence supporting shareholder capacity is now integral to the incorporation process where foreign participation exists below the 50% threshold or through a foreign signing authority.
For investors planning Thai market entry from 2026 onward, incorporation should be treated as a substantive compliance event requiring early structuring and documented funding preparation.
The filing formalities remain, but they are no longer merely formal.
For tailored advice on Thai company registration, FBA compliance, shareholding structure and nominee risk assessments, or the 2026 DBD requirements, contact FOSR Law at [email protected].
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The comments herein are for informational purposes only, are not guaranteed to be up to date, and do not constitute legal advice.
© Formichella & Sritawat 2026