Exchange Control Regulations
Foreign currency transactions between residents and non-residents of Thailand are governed by exchange control regulations, which are provided for under the Exchange Control Act (B.E. 2485) and Ministerial Regulation No. 13 (B.E. 2497) which was issued under the former.
Rationale for Exchange Control Regulation
✓ Maintain control over the inflow and outflow of currency.
✓ Maintain stability of the economy through prevention of volatile exchange rates.
✓ Minimize speculation against local currency.
✓ Protect and preserve foreign currency reserves.
Administration
The Bank of Thailand (BOT) is generally responsible for regulating foreign exchange, and its officials have been appointed to be ‘competent officers’ under the Exchange Control Act (B.E. 2485).
Foreign currency transactions are required to be carried out through commercial banks and other authorized institutions which have been granted foreign exchange licenses by the Minister of Finance. These authorized institutions include money changers and money transfer agents which have been granted the aforementioned authority.
If foreign currency transactions are not carried out via these banks or authorized institutions, approval from a competent officer has to be sought on a case-by-case basis.
Regulation of Foreign Currency
There is no limit imposed on the amount of foreign currency which may be transferred or brought into Thailand. However, individuals who receive foreign currencies from abroad in a sum of USD 1 million or more must either convert them into Thai baht immediately at an authorized bank or deposit the money in a foreign currency account with an authorized bank within 360 days of receipt. Individuals who bring in or take out foreign currency bank notes amounting to a total sum of more than USD 20,000 must also make a declaration to a customs officer.
Individuals and entities which are not subject to this requirement include foreigners staying in Thailand for a period of three months or less, foreign embassies, international organizations and their representatives with diplomatic privileges and immunities, as well as Thai emigrants who are working overseas or have permanent residency in another country.
Foreign currency can be purchased from authorized banks upon submission of documents evincing that such purchase pertains to international trade and investment.
Companies in Thailand may also engage in derivatives transactions with authorized banks to hedge against foreign exchange risk, subject to the submission of supporting documents regarding foreign currency receipts or obligations.
Regulation of Local Currency
There is no limit imposed on the aggregate value of Thai baht bank notes which may be brought into Thailand.
However, individuals traveling to Vietnam, the Yunnan province of the People’s Republic of China or Thailand’s bordering countries may only take out a maximum of 2 million Thai baht.
Individuals traveling to other countries may only take out a maximum of 50,000 Thai baht.
Individuals who bring in or take out Thai baht bank notes, foreign currency bank notes or negotiable monetary instruments in a total sum of more than 450,000 baht or USD 15,000 must make a declaration to a customs officer.
Other Relevant Regulations
A. Bank Deposits
a. Foreign Currency Account of Thai Residents
Thai residents may maintain foreign currency accounts with authorized banks. The deposit and withdrawal of funds are subject to several conditions:
1. Deposits
✓ There is no limit imposed on the amount of foreign currency (from abroad or purchased/borrowed from authorized banks) which Thai residents may deposit.
✓ Foreign currencies may be deposited up to the following limits:
◉ The amount brought into Thailand or obtained from commercial banks or non-bank foreign exchange licensees; or
◉ Up to USD 15,000.
2. Withdrawals
Withdrawals are allowed for the following purposes:
✓ Payment to entities overseas, in respect of an account holder’s obligations or its subsidiaries’ obligations.
✓ Payment to authorized banks or non-bank foreign exchange licensees, in respect of an account holder’s obligations or its subsidiaries’ obligations.
✓ Deposit into other foreign currency accounts of the same account holder.
✓ Conversion into Thai baht.
b. Foreign Currency Account of Non-residents
Non-residents are allowed to maintain foreign currency accounts with authorized banks, and no limits are imposed in this regard. However, the deposit of foreign currency is subject to the above-mentioned regulations.
c. Non-resident Baht Account
Non-residents are allowed to open Thai Baht accounts with authorized banks in Thailand.
✓ Non-resident Baht Account for Securities (NRBS): A NRBS account may be debited or credited for purposes of investment in securities and other financial instruments.
✓ Non-resident Baht Account (NRBA): A NRBA account may be debited or credited for general purposes, excluding investment in securities.
There is a limit of 200 million Thai baht per non-resident on the total daily outstanding balance for each type of account.
Non-residents are not allowed to make transfers between different types of accounts.
B. Trade and Services
a. Exports
Export proceeds amounting to USD 1 million or more shall be converted into Thai baht immediately after receipt of payment, and within 360 days from the export date.
These proceeds must be sold to or deposited into a foreign currency account with an authorized bank in Thailand within 360 days of receipt.
b. Imports
Importers are allowed to purchase or withdraw foreign currencies from their own foreign currency accounts for import payments upon submission of supporting documents.
Letters of credit can be opened without authorization.
c. Services
All proceeds from services amounting to USD 1 million or more shall be converted into Thai baht immediately after receipt of payment, and within 360 days from the transaction date. These proceeds must be sold to or deposited into a foreign currency account with an authorized bank in Thailand within 360 days of receipt.
Outward remittances for services, traveling expenses or educational expenses, are allowed upon submission of supporting documents to an authorized bank.
C. Foreign Investments
Where direct and portfolio investments in Thailand are concerned, transfers may be made in foreign currency.
Repatriation of investment funds and repayment of overseas loans are permitted, subject to the submission of supporting documents to an authorized bank.
D. Capital Transfers by Residents of Thailand
a. Direct Investment and Lending Abroad
✓ No restrictions are imposed with regards to a Thai company or natural person’s investment in an overseas business entity in which it has shares of 10% or more, or if it seeks to invest or lend to affiliated business entities abroad.
✓ A Thai company may lend to non-affiliated business entities abroad, subject to a limit of USD 50 million per year.
Fund transfers for such investment or lending to business entities abroad must be carried out in foreign currency.
However, fund transfers for investment or lending to business entities in Vietnam or Thailand’s neighboring countries for the purposes of trade and investment may be conducted in foreign currency or in Thai Baht.
b. Portfolio Investment Abroad
✓ There is generally no limit imposed on the amount which institutional investors may invest in foreign securities. However, such investments are likely to be subject to restrictions set by the supervisory authority, directors or management of each institutional investor.
✓ Retail investors may invest in foreign securities without the need for a local intermediary, subject to a limit of USD 5 million per investor per calendar year.
There is also no restriction on the amount which investors may invest in foreign securities through local intermediaries. However, such investments must be conducted in accordance with guidelines set by the Securities and Exchange Commission.
c. Transfers for Other Purposes
✓ Individuals are allowed to purchase immovable properties abroad in their own name or a family member’s name, subject to a limit of USD 50 million per person per year.
✓ Transfers may be made to any person abroad, subject to a limit of USD 50,000 per year. However, Thai emigrants may freely transfer funds or to their families or relatives who are permanent residents of Thailand.
Transfers for other purposes are generally allowed. However, prior approval from BOT has to be obtained with regards to transfers for certain purposes, such as purchase or exchange of foreign currencies with non-residents as well as derivatives transactions.
E. Reporting
Persons who purchase, sell, deposit, or withdraw foreign currencies with an authorized bank in an amount of USD 50,000 or above are required to notify the respective bank with details of the relevant foreign exchange transaction. The authorized bank will then issue evidence of the transaction after it has been conducted.