Thailand is taking another step towards the reformation of foreign business law for ease of doing business and aligning Thailand’s investment regime with the Organization for Economic Co-operation and Development (OECD) Policy Framework for investment. Following the Cabinet’s approval in principle on 12 May 2026 of the proposal by the Department of Business Development (DBD) to narrow the scope of “Restricted Business” under the foreign business law, the Ministerial Regulation Prescribing Service Businesses Which Do Not Require a Foreign Business License (No. 5) B.E. 2569 (2026) (the “Ministerial Regulation“) was published in the Government Gazette on 28 August 2026 and became effective on the same date.
The reform is intended to facilitate business operations and reduce unnecessary or duplicative licensing procedures, while taking into account the nature and regulatory framework applicable to each business. Following the exemption under the Ministerial Regulation, certain businesses remain subject to supervision under sector-specific laws and regulations notwithstanding the exemption under the Foreign Business Act B.E. 2542 (1999) (the “Foreign Business Act“).
Broadened Scope of Business Activities For Foreign Investors
The Ministerial Regulation expands the service businesses that foreign investors may undertake without obtaining permission under the Foreign Business Act. Consistent with the policy underlying the reform, the exempted businesses may be categorized into three main categories, as outlined below:
1. Business regulated by specific regulators
Aiming to reduce duplicated regulatory procedures for businesses already subject to specific regulatory regimes, the Ministerial Regulation exempts certain regulated businesses from the restricted business under the Foreign Business Act. These include:
- certain securities-related activities, including lending for the purchase of securities and securities repurchase transactions;
- derivatives dealer, derivatives advisors or derivatives fund manager for (i) derivatives contracts which the underlying commodity or reference variables falling outside the scope of Derivatives Act and (ii) derivatives contracts with settlement based on foreign exchange rate or interest rate, where such transactions are conducted outside licensed derivatives exchange;
- purchase of securities under repurchase agreements (repos);
- telecommunication business for telecommunication license type one regulated under Telecommunications Business Act, e.g. telecommunications services which operating without owning infrastructure and/or network; and
- treasury center business regulated under Exchange Control Act.
The exemption under the Foreign Business Act does not, however, constitute a general deregulation of these businesses. Where the relevant activities are still regulated and the foreign investors remain required to comply with the applicable requirements under the relevant laws and regulations.
2. Service business provided to group companies
The Ministerial Regulation also exempts certain services provided between group companies on the basis that such activities are conducted within a corporate group rather than generally competing with Thai business operators in the market. The exempted activities comprise:
- administrative management, human resources and information technology services provided between group companies; and
- guarantees for debts in Thailand provided between group companies.
Importantly, the Ministerial Regulation prescribes specific criteria for determining whether entities are sufficiently qualified as “group companies” taken into account, among others, common shareholders or partners, direct or common ownership interests and common management.
The applicable ownership thresholds differ between the two exemptions. For administrative management, human resources and information technology services, “group companies” are based on a shareholding or partnership interest of at least 25% of the capital of the relevant entities. In comparison, the corresponding tests for guarantees of debts in Thailand, “group companies” are based on a shareholding or partnership interest of more than 50%. Foreign investors seeking to rely on these exemptions should therefore consider whether the relevant corporate entity satisfies the applicable criteria under the Ministerial Regulation.
3. Other business
The Ministerial Regulation also exempts two service businesses which, by their nature, have a limited scope of services or are provided to specific customers; comprising:
- the leasing of limited space for the installation of electronic equipment used for financial services and vending or automatic machines for the purpose of providing services and facilitate to employees of the company; and
- the petroleum drilling services, provided that the contractor has directly entered into a service contract with a concessionaire, production sharing contractor or service contract holder under the petroleum law. The explanation is that petroleum drilling, particularly offshore drilling, generally requires advanced technology and significant capital investment. This exemption will help broaden the availability of service providers to support the operation of the petroleum sector.
Implementation of the Foreign Business Reform
The issuance of the Ministerial Regulation marks the implementation of the reform approved in principle by the Cabinet in May 2026. The explanatory note to the Ministerial Regulation states that the relevant businesses are those in which Thai operators are ready and capable of competing with foreign operators or which involve activities between related entities. As exemptions for service business under List Three (21) of the Foreign Business Act must be prescribed by ministerial regulation, the Ministerial Regulation provides the legal basis for foreign investors to operate these activities without obtaining permission under the Foreign Business Act.
The Ministerial Regulation therefore represents a further step in Thailand’s ongoing efforts to streamline its foreign business regulatory framework and facilitate business operations for foreign investors.