In a significant move to enhance Thailand’s business integrity and ensure fair competition, the Department of Business Development (DBD), Ministry of Commerce, has officially launched the Division for the Prevention and Suppression of Illegal Businesses. The new unit, announced during its inaugural meeting on October 1, 2025, represents a proactive step by Thai authorities to tackle persistent issues surrounding illegal business operations and nominee shareholding structures—where Thai nationals hold shares on behalf of foreign principals to circumvent ownership restrictions.
A Four-Pillar Approach to Oversight and Enforcement
The newly formed Division has established four specialized subcommittees, each with a distinct focus designed to close compliance loopholes and strengthen the integrity of Thailand’s corporate ecosystem:
1. Registration Prevention: Developing preventive mechanisms and enhanced screening processes for new company registrations to identify and block suspicious setups at the source.
2. Data Analysis: Gathering and cross-referencing shareholder data to identify unusual ownership structures, cross-holdings, or patterns that may indicate nominee arrangements.
3. Accounting Audits: Conducting in-depth financial audits to uncover irregular transactions, shadow accounting, or hidden beneficial ownership schemes.
4. Legal Affairs: Coordinating legal proceedings, improving inter-agency cooperation, and formulating new policies to support long-term enforcement and regulatory reforms.
This integrated structure reflects a shift from reactive investigations to data-driven prevention and strategic enforcement, aligning with Thailand’s broader commitment to good governance and sustainable economic development.
Reinforcing Transparency and Investor Confidence
DBD Director-General Mr. Poonpong Naiyanapakorn emphasized that the initiative supports Thailand’s mission to promote fairness, transparency, and equitable economic growth. By tightening oversight over nominee shareholding, the government aims to ensure that all market participants—Thai and foreign—compete on a level regulatory playing field.
For legitimate foreign investors, this reform also signals greater clarity and confidence. The crackdown on illicit corporate structures helps preserve the reputation of Thailand as a trustworthy investment destination governed by rule-based transparency and predictable enforcement.
Implications for Businesses and Advisors
The establishment of this Division will likely trigger stricter scrutiny of company registrations, shareholder disclosures, and accounting records. Businesses, law firms, and accounting professionals should expect increased coordination among regulatory bodies and enhanced data-sharing capabilities between the DBD, Anti-Money Laundering Office (AMLO), and Revenue Department.
In practice, this development reinforces the need for robust corporate governance, transparent shareholding structures, and diligent compliance documentation. Foreign investors operating through Thai entities must ensure that beneficial ownership and capital arrangements are properly declared and that their business models comply with the Foreign Business Act B.E. 2542 (1999) and related laws.
The Broader Context: Toward a Fair and Sustainable Business Landscape
This latest reform underscores Thailand’s ongoing evolution toward a more accountable, transparent, and internationally aligned regulatory environment. The DBD’s initiative marks an essential step in protecting national economic interests while also strengthening Thailand’s credibility within the ASEAN investment community.
At a strategic level, the move serves as both a deterrent and an invitation: discouraging the misuse of nominee structures while encouraging legitimate, well-structured foreign participation that contributes to Thailand’s long-term economic vision.