Nominee Structure Assessment in Thailand

Nominee Structure Assessment in Thailand

At Formichella & Sritawat, we provide clear, commercially focused guidance to businesses operating in Thailand. Determining whether a company’s shareholding structure aligns with Thai law is an essential part of ensuring long-term operational stability. Our nominee structure assessment service assists clients in reviewing their corporate arrangements, identifying potential compliance issues, and implementing appropriate measures where required.

The DBD Crackdown in the Media

• DBD & authorities tightening scrutiny on nominee structures in 2026, Pattaya Mail reports that tighter scrutiny and risks are pushing investors to move away from nominee structures because of intensified enforcement.
• Over 7,000 suspected nominee businesses identified, The Nation reports that the DBD has identified thousands of suspect nominee companies in tourism, hospitality and real estate on Koh Samui and Koh Phangan, part of an active crackdown.
• Ongoing Koh Phangan enforcement and police action, Thai Examiner reports that Thai authorities continue raids, document inspections, and strict actions focused on illegal nominee arrangements.
• Broad probe into nominee arrangements nationwide, Bangkok Post reports that the DBD plans to investigate tens of thousands of juristic entities for nominee use.

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Thai regulations prohibit the use of nominee shareholders, which are individuals or entities that hold shares on behalf of others without genuine financial participation or control. Authorities assess both documentary evidence and the practical operation of the business when determining whether a structure may constitute a nominee arrangement.

Common indicators include:

• Shareholders whose financial contribution does not correspond to their registered shareholding
• Use of foreign-funded loans or similar arrangements to facilitate Thai shareholding
• Voting patterns or control rights that do not align with ownership percentages
• Side agreements or informal arrangements transferring authority to foreign parties

A structured review helps clarify whether any aspect of the company’s arrangements may raise compliance concerns.

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When an Assessment May Be Appropriate

A nominee structure review may be advisable in situations such as:

• Company restructuring or preparation for new investment
• Upcoming licensing applications or regulatory filings
• Changes in shareholder relationships or capital contributions
• Requests from banks, counterparties, or auditors for compliance confirmation

Our team provides assessments grounded in the Foreign Business Act, related regulations, and current enforcement trends. The objective is to help clients understand their risk exposure and consider restructuring options where appropriate.

Our Assessment Process

Our review typically includes:

1. Initial screening of corporate documents, shareholding records, and financing arrangements

2. Detailed examination of shareholder agreements, loans, management structures, and capital flows

3. Compliance analysis against the Foreign Business Act and relevant administrative guidance

4. Recommendations for adjustments or restructuring if required

To begin the process, you may complete our preliminary assessment form below. Our team will review your information and contact you regarding next steps.

When to Seek Formal Advice

Even where a structure was not intended to create a nominee arrangement, certain elements may inadvertently raise regulatory questions. Formal legal advice is recommended when:

• Financial contributions or funding sources are unclear
• Foreign stakeholders participate significantly in management decisions
• Shareholding percentages do not reflect actual investment
• Historic documents require clarification or updating

We assist clients in evaluating these matters with confidentiality and a practical, commercially informed perspective.

Frequently Asked Questions

What constitutes a nominee shareholder under Thai law?
A nominee shareholder is a person or entity holding shares on behalf of another without genuine financial ownership or control. Authorities consider both documentation and the substance of the relationship.

Is the use of loans to Thai shareholders prohibited?
Loans are not prohibited, but funding arrangements may be scrutinized if they suggest that a Thai shareholder is not exercising genuine ownership.

What happens if a structure is found non-compliant?
Outcomes vary depending on the circumstances and may include administrative action or requirements to restructure. We advise clients on corrective pathways suited to their situation.

How long does the assessment take?
A preliminary review is typically completed quickly, depending on document availability. More complex structures may require additional time.

Begin Your Assessment

Please complete the assessment form below to initiate our review of your company’s structure.