According to the Foreign Business Act of 1999 (the “FBA”), there are three types of business activities:
- List 1: Business Not Permitted to Foreigners (Publishing and broadcasting, agriculture, forestry, fishing and trading in real property, etc.)
- List 2: Business Permitted to Foreigners under Conditions (National security, art, culture, local custom, natural resources and environment, etc.)
- List 3: Business Not Yet Permitted to Foreigners (Wholesale/retail, hotel business, broker/agent, restaurants, and all service businesses, etc.)
Activities that fall under List 1 are strictly prohibited to aliens.
List 2 are prohibited to aliens unless permission is granted by the Cabinet.
Businesses that are covered by List 3 are prohibited to aliens unless permission is granted by the Director-General of the Commercial Registration Department (“CRD”).
Based on the above definition, if majority of the shares of a limited company are held by Thais, it is regarded as a Thai company and thus not subject to this Act. This means that aliens are generally allowed to participate up to 49% in a company engaged in restricted businesses. Beyond that, the approval requirement must be complied with. Strictly speaking, any company with majority of foreign shareholders is required to apply for the Foreign Business License (FBL). The minimum capital requirement for foreigners is two million baht in general, and three million baht for those under List 2 or List 3.
See other resources here: Thailand Foreign Business Act Restrictions.