How to Restructure Existing Thai Companies to Increase Foreign Ownership (thailand 2026): Steps, Approvals & Risks

To increase foreign ownership thailand investors must navigate a landscape shaped by the Foreign Business Act (FBA) and by proposed reforms to that framework that the Thai Cabinet has been considering to ease foreign direct investment. For foreign shareholders, in-house counsel and directors weighing whether and how to lift foreign shareholding above the traditional thresholds, the decision is no longer simply a question of law but one of sequencing, approvals and risk management. This guide maps the practical routes available, share transfers, capital increases, corporate reorganisation, Board of Investment (BOI) promotion and foreign business licences, alongside the procedural checklists, approval matrices and timelines that determine whether a restructuring succeeds.

It is written for decision-makers who need an actionable roadmap rather than a headline summary.

Executive summary, options to increase foreign ownership thailand at a glance

Before diving into the mechanics, it helps to see the field of options in one view. There is no single “best” route to increase foreign ownership thailand, the right path depends on your sector, whether the company is listed, your control objectives, tax exposure and minority-shareholder protections. The principal routes are:

• Share transfer. Existing Thai shareholders sell to foreign buyers. Fast and administratively light, but constrained by the FBA foreign-ratio test and any sector restrictions.
• Capital increase. The company issues new shares subscribed by foreign investors. Useful where fresh capital is wanted, but pre-emptive rights and valuation must be managed.
• Corporate reorganisation. Interposing a holding company, amalgamating entities or transferring assets to reposition where the foreign interest sits. Powerful but slower and more complex.
• BOI promotion. Securing a promotion certificate for eligible activities, which can permit majority, in many cases full, foreign ownership, subject to certificate conditions.
• Foreign Business Licence (FBL) or Foreign Business Certificate. Applying for permission to operate in a restricted activity while exceeding the ordinary foreign threshold.
• Listed-company route. For companies on the Stock Exchange of Thailand (SET), changes trigger securities disclosure, threshold reporting and potential mandatory tender offers.

For a typical mid-sized private company not operating in a restricted sector, a straight share transfer or capital increase is usually the fastest route. Where the activity is restricted, BOI promotion is frequently a cleaner route to exceed the 49% ceiling than an FBL, because promotion conditions are structured and relatively predictable. A simple decision flow runs: Is the activity BOI-eligible? → If yes, assess BOI promotion. If no, is an FBL required? → If the ordinary threshold suffices, use a transfer or capital increase. If restructuring the ownership chain solves the test, consider a holding company.

Can you increase foreign ownership thailand under the FBA framework? (Legal overview)

The Foreign Business Act B.E. 2542 (1999), administered through the Ministry of Commerce and its Department of Business Development (DBD), is the statutory backbone governing foreign participation in Thai business. Its core mechanism is a definitional test: a company is treated as “foreign” where foreign shareholders hold 50% or more of its capital, with restricted activities grouped into three Lists (schedules) that respectively prohibit foreign operation, condition it, or permit it with a licence. Any reform package would be enacted through amending legislation published in the Royal Thai Government Gazette, and investors should read any enacted amendment text closely against their specific facts.

Proposed reforms

The Thai Cabinet has approved proposed changes to the foreign business law intended to reduce regulatory duplication, facilitate foreign direct investment and streamline the approval architecture that has previously slowed inbound investment. As of 2026, investors should verify whether these proposals have been formally enacted. Until an amendment is promulgated in the Royal Thai Government Gazette and reflected in the consolidated text maintained by the Office of the Council of State (Krisdika), the existing FBA framework continues to apply. Each restructuring should therefore be checked against the law actually in force rather than against secondary commentary or proposals still under consideration; where a provision remains under consideration rather than enacted, treat it as prospective and plan to the current law.

Critically, the reforms under discussion do not abolish the foreign-ratio test altogether. They are aimed at refining how the approval process operates and easing pathways around the test. To increase foreign ownership thailand lawfully, you still work within the List framework, either because your activity is unrestricted, because you obtain a licence, or because you rely on a promotion or treaty route that overrides the ordinary ceiling.

Sectors still restricted

Several categories remain tightly controlled. Activities touching national security, land ownership, media, certain agricultural and natural-resource sectors, and a wide range of service businesses continue to attract restriction or require a licence before a foreign-majority structure is permitted. The lesson for planning is simple: confirm the List classification of your actual activities first. Two companies with superficially similar business descriptions can sit on opposite sides of the restriction line, and that single fact usually dictates whether you can increase foreign shareholding by a private transfer or whether you need BOI promotion or an FBL.

Choosing the right route, transfer, capital increase or corporate reorganisation?

Once you know your activity is permissible for a greater foreign stake, the next decision is mechanical: how do you actually move the ownership? Each route has distinct triggers, costs and control consequences, and the best choice turns on whether you want to inject capital, exit existing shareholders, reposition the ownership chain, or protect minority investors.

Share transfer: mechanics and risks

A share transfer is the most direct way to increase foreign shareholding: existing Thai shareholders sell shares to foreign purchasers. Under the Civil and Commercial Code, transfers of registered shares are effected by a written instrument of transfer signed by the transferor and transferee and witnessed, and the company must update its share register; the updated shareholder position is then reflected in filings with the DBD. The attractions are speed and simplicity. The risks are equally concrete.

Pre-emption rights in the articles of association may oblige the seller to offer shares to existing holders first; stamp duty applies to the transfer instrument; and the transaction must not cause the company to breach the FBA foreign-ratio test in a restricted sector without the appropriate licence or promotion. A share transfer changes ownership but does not, by itself, bring new capital into the company.

Capital increase: process, pre-emptive rights and valuation

Where the objective is to inject funds as well as increase foreign ownership, a capital increase is often preferable. The company passes a special shareholders’ resolution to increase registered capital, issues new shares and allots them to the incoming foreign subscriber. Two issues dominate: pre-emptive rights and valuation. Under the Civil and Commercial Code, new shares must generally first be offered to existing shareholders in proportion to their holdings, so achieving a target foreign percentage may require those rights to be waived or structured around through the shareholders’ resolution. Valuation matters because the subscription price affects dilution of existing holders and the economics of the deal.

Capital increases require careful resolution drafting, registration of the increased capital with the DBD and, for foreign remittances, attention to Bank of Thailand foreign-exchange reporting requirements when funds are brought into the country.

Corporate reorganisation (holding company or amalgamation): when to use

Where a simple transfer or capital increase cannot achieve the desired ownership outcome, for example because of sector restrictions at the operating-company level or because multiple entities need to be aligned, a corporate reorganisation may be the answer. Interposing a holding company, amalgamating entities, or transferring assets into a newly structured vehicle can reposition where the foreign interest sits in the group. This route offers the greatest flexibility to solve a difficult foreign-ratio test, but it is also the slowest and most document-intensive. It typically engages tax analysis on asset transfers, creditor and employee considerations on amalgamations, and a longer approval runway. Reorganisation is best reserved for situations where the straightforward routes cannot deliver the target structure.

Approvals & filings, step-by-step checklist and timelines to increase foreign shareholding

Knowing the route is only half the task. Delivering it requires coordinating approvals across the DBD, the Ministry of Commerce, the BOI and, for listed companies, the SEC and SET. Below are stepwise checklists by route, with indicative timings that scale with complexity. Treat the lower end as achievable for clean, unrestricted transactions and the upper end as realistic where restriction, licensing or securities triggers apply.

For share transfers

1. Legal due diligence. Confirm the FBA List classification of the company’s activities and whether the post-transfer foreign ratio is permissible. (Typically 1–3 weeks.)
2. Review the articles. Check pre-emption rights, transfer restrictions and board-approval requirements in the articles of association.
3. Documentation. Prepare the instrument of transfer, board and shareholder resolutions where required, and any share purchase agreement with warranties.
4. Stamp duty. Pay stamp duty on the transfer instrument at the prescribed rate before or at completion.
5. Update the share register. Record the transfer in the company’s share register and shareholder list.
6. File with the DBD. Submit the updated shareholder information to the Department of Business Development as required.
7. Securities steps (if listed). Make SEC/SET disclosures and assess tender-offer thresholds.

Common roadblocks include undisclosed pre-emption clauses, an inadvertent breach of the foreign-ratio test in a restricted activity, and stamp-duty miscalculation. Mitigation is straightforward: diligence the articles early, confirm the List classification before signing, and model the post-transaction ratio.

For capital increases

1. Board resolution. Convene the board to propose the capital increase and the allotment plan.
2. Shareholder resolution. Pass the special resolution to increase registered capital and, where needed, to manage pre-emptive rights.
3. Subscription and payment. The foreign subscriber subscribes and pays for new shares; manage inbound remittance and Bank of Thailand foreign-exchange reporting.
4. Register the increase. File the increased capital and amended particulars with the DBD within the prescribed period.
5. Update registers. Reflect the new allotment in the share register and shareholder list.

The valuation and pre-emption steps are where capital increases most often stall, so agree the subscription price and the treatment of existing shareholders’ rights before calling the meeting.

For BOI-promoted schemes

1. Eligibility assessment. Confirm the activity appears on the BOI’s list of activities eligible for promotion and map the conditions attached.
2. Application. Submit the BOI application with the business plan, investment details and shareholding structure.
3. Review and presentation. Respond to BOI queries and attend any project presentation.
4. Promotion certificate. On approval, receive the certificate specifying the permitted foreign shareholding and conditions.
5. Implement the ownership change. Carry out the transfer or capital increase consistent with the certificate and update DBD filings.

Because the BOI route can permit foreign ownership above the ordinary ceiling, it is frequently the decisive mechanism for restricted-sector investors. The trade-off is a longer runway, commonly three to nine months, and ongoing compliance with the certificate’s conditions.

Interaction with BOI incentives, foreign business licences and securities rules

No restructuring to increase foreign ownership thailand should be planned without understanding how the BOI, the FBL regime and the securities rules interact. These three frameworks determine both whether you can exceed 49% and what you must disclose once you do.

BOI exemptions and conditions

BOI promotion is a commonly used mechanism to hold a foreign stake above the ordinary threshold. For promotable activities, notably in targeted manufacturing and qualifying service sectors, a promotion certificate can allow majority and, in many cases, full foreign ownership, in addition to tax and non-tax incentives. The permission is not unconditional: the certificate specifies the promoted activity, investment commitments and operating conditions, and ownership freedoms are tied to continued compliance. The practical sequence is to secure the certificate first and then effect the share transfer or capital increase so that the resulting foreign percentage is covered by the promotion. Investors should consult the BOI’s current guidance to confirm eligibility and conditions for their specific activity.

FBL process and limits

Where an activity is restricted but not BOI-promotable, a Foreign Business Licence may permit foreign-majority operation. The FBL is an activity-specific permission granted by the Ministry of Commerce (with applications considered by the Foreign Business Committee), and the application is evaluated on the merits of the business and its economic contribution. Compared with BOI promotion, the FBL route can be less predictable and does not carry an incentive package, which is why BOI promotion is generally preferred where the activity qualifies. The FBL remains essential, however, for restricted service businesses that fall outside the scope of BOI promotion.

Note that investors able to rely on a treaty, such as under the US–Thailand Treaty of Amity, may instead apply for a Foreign Business Certificate.

Securities compliance

For listed companies, increasing foreign shareholding can trigger securities obligations administered by the SEC and SET. Crossing substantial-shareholding reporting thresholds engages disclosure and reporting duties; acquiring shares beyond prescribed levels can trigger mandatory tender-offer rules requiring an offer to all shareholders; and connected or insider transactions attract additional procedural requirements. These rules apply irrespective of the FBA analysis, so a transaction that is clean under the Foreign Business Act may still be constrained by securities law. Listed-company restructurings should therefore be modelled against both frameworks simultaneously.

Practical considerations: tax, stamp duty, employment and immigration

Increasing foreign ownership is rarely a purely corporate exercise; it carries tax, employment and immigration consequences that can determine deal economics. On the tax side, share transfers attract stamp duty on the transfer instrument at the prescribed rate, and gains on disposal may give rise to income or withholding tax depending on the seller’s status and any applicable double-tax treaty, a point to clear against the Revenue Department’s rules before completion. Capital increases generally carry lighter duty but engage Bank of Thailand foreign-exchange reporting when foreign funds are remitted to subscribe for shares.

Where a change of ownership also changes control, employment and social-security obligations can be affected, and new foreign directors or managers will need to consider work permits and visa arrangements. These are not afterthoughts: a restructuring that installs foreign directors without aligning immigration and work-permit status can create compliance gaps. Build a short checklist covering stamp duty, withholding, FX reporting, employment impacts and director immigration status, and align them to the transaction timeline so nothing is left to completion day.

Risks, compliance traps and mitigation strategies

Easier lawful routes to increase foreign shareholding make unlawful workarounds harder to justify. The single most important risk to avoid is reliance on nominee shareholders, arrangements in which Thai nominees hold shares on behalf of foreign principals to disguise the true foreign interest. The FBA contains anti-nominee provisions, and enforcement exposure includes criminal penalties and unwinding of the structure. The de facto control analysis is equally important: regulators can look beyond the formal shareholding to who really controls voting, board composition and economic benefit. A structure that is compliant on paper but confers de facto foreign control over a restricted activity invites challenge.

Other traps include inadvertent breach of the foreign-ratio test after a transfer, failure to make SEC/SET disclosures or tender offers on listed companies, and post-transaction regulatory review that reclassifies the activity. Mitigation is about building legitimate structures rather than concealing illegitimate ones:

• Use lawful routes. Rely on BOI promotion, FBLs/certificates or permissible foreign ratios rather than nominee arrangements.
• Contractual protections. Use shareholders’ agreements, drag/tag rights and reserved-matter clauses to protect foreign investors within lawful ownership limits.
• Board arrangements. Structure board composition and voting to reflect legitimate governance, not disguised control.
• Escrow and conditions. Hold consideration in escrow pending regulatory clearances and confirmation of approvals.
• Pre-clearance. Where the position is uncertain, obtain advice and, where available, confirmation from the relevant authority before completing.

Step-by-step sample roadmap for a mid-sized private company

The following illustrative timeline shows how a mid-sized private company in an unrestricted or BOI-promotable sector might sequence a restructuring to increase foreign ownership over roughly six months. Timescales compress for clean transfers and extend where BOI promotion or FBLs are involved.

1. Month 0–1: Diagnosis. Legal due diligence on FBA classification, review of articles and share register, and confirmation of the target foreign percentage. Responsible: legal counsel and board.
2. Month 1–2: Route selection. Decide between transfer, capital increase, reorganisation or BOI promotion; model tax, control and securities consequences. Responsible: investor, counsel, tax adviser.
3. Month 2–3: Approvals preparation. If BOI-promotable, file the BOI application; if restricted, prepare the FBL application; otherwise prepare transaction documents. Responsible: counsel and BOI/FBL specialists.
4. Month 3–5: Execution. Pass board and shareholder resolutions, execute the transfer or capital increase, pay stamp duty, manage FX remittance reporting. Responsible: company secretary and counsel.
5. Month 5–6: Filing and closing. Update the share register, file with the DBD, make SEC/SET disclosures if listed, and confirm all conditions satisfied. Responsible: counsel and DBD filing agent.

Use a structured checklist of documents and approvals to keep each checkpoint auditable, a Checklist: Documents & Approvals Needed to Increase Foreign Shareholding in Thailand is a natural companion to this roadmap.

Conclusion & recommended next steps

The current framework, together with reforms under consideration to ease foreign direct investment, creates a genuine opportunity to increase foreign ownership thailand lawfully and efficiently, but it rewards disciplined execution rather than opportunism. The practical order of work is consistent across fact patterns: confirm the FBA classification of your activity; select the route that matches your capital, control and tax objectives; assess whether BOI promotion or an FBL is required to exceed the ordinary threshold; and model the securities consequences if the company is listed. Immediate next steps for most companies are to commission legal due diligence, obtain board approval in principle, run a BOI eligibility assessment and carry out pre-clearance checks before committing to a route.

Done carefully, a restructuring to increase foreign shareholding can be completed with predictable timing and controlled risk, and the independent, practitioner-focused support available through the Global Law Experts network can help you pressure-test the plan before you act.

This article provides general information and is not legal advice. Readers should obtain tailored legal advice before acting, and should verify the current status of any proposed legislative reforms.

Sources

1. Office of the Council of State (Krisdika), Thai legislation database
2. Royal Thai Government Gazette (Ratchakitcha)
3. Ministry of Commerce, Department of Business Development (DBD)
4. Thailand Board of Investment (BOI)
5. Securities and Exchange Commission, Thailand (SEC)
6. Stock Exchange of Thailand (SET)
7. Bank of Thailand
8. The Revenue Department of Thailand
9. UNCTAD, Investment Policy Hub