The Nominee Company Crackdown, and What It Means If You "Own" a Hua Hin Villa

If you hold a house or land in Hua Hin through a Thai limited company, the ground under that arrangement has moved three times in eight months. It moved again on Saturday.

What follows is a report on what the authorities have published and what credible outlets have reported. It is not legal advice and we are not lawyers. What you should do about your own company is a conversation for a Thai lawyer who has read your documents.

What a nominee structure actually is

The pattern is well known here. Foreigners cannot own land in Thailand, so a Thai limited company is registered. The foreigner takes 49 per cent of the shares. Thai shareholders — introduced by the agent, or staff at the accountancy firm, or people the buyer has never met — take 51 per cent. The company buys the land. The foreigner is sole authorised director, controls the bank account, pays every bill and holds signed but undated share transfers in a drawer. The Thai shareholders put in no money and take no risk.

That is a nominee arrangement. Not an aggressive structure, not a workaround. Thai law has a name for it and a penalty for it.

Why this is not a grey area

Section 36 of the Foreign Business Act 1999 makes it an offence for a Thai national to hold shares on behalf of a foreigner so that the foreigner can do business a foreigner may not do. Section 37 covers the foreigner on the other side. Both carry imprisonment of up to three years, a fine of ฿100,000 to ฿1 million, or both, and a daily fine of ฿10,000 to ฿50,000 for continuing after conviction.

The land sits under a separate statute. Section 96 of the Land Code covers land acquired in another person’s name to evade the restrictions on foreign ownership, and applies Section 94 to it. Section 94 requires disposal within a period set by the Director-General of the Department of Lands — not less than 180 days, not more than one year. Miss it and the Director-General may sell the land in your place.

So the exposure is criminal liability, forced disposal of the asset, and, for a foreigner convicted of an offence, the ordinary consequences for a visa or extension of stay. What has changed is not the law. It is the ability to find you.

What changed, and when

Three orders in eight months, each one widening the net.

DBD Order No. 2/2568, effective 1 January 2026. This applies at incorporation. Where a foreigner takes less than half the shares, or where there is no foreign shareholder but a foreigner is an authorised director with binding signature, the Thai shareholders must produce three months of bank statements showing the money leaving their accounts to pay for their shares. The previous rule, Order 205/2555, accepted a bank letter confirming the shareholder had funds. A letter is easy. A statement showing a withdrawal on the subscription date is not.

DBD Order No. 1/2569, effective 1 April 2026. The 1 January rule only bit on new companies, which left several hundred thousand existing ones untouched. This order extends the same scrutiny to amendments — adding a foreign partner, appointing a foreign authorised director, changing who signs. It also introduces an Investment Confirmation Letter, signed by the managing partner or authorised director, certifying that every shareholder genuinely paid for their shares and that no Thai national is holding as a nominee. The signature carries personal liability if the statement is false.

Order of the Central Partnership and Company Registration Office No. 2/2569, effective 1 August 2026. Two days ago, and the one with the widest reach.

What the 1 August requirement means in practice

Under Order No. 2/2569, where a foreigner is a shareholder or an authorised signatory, the registrar can ask for the whole trail rather than one end of it. Thai shareholders provide three months of statements showing funds leaving their accounts. The director or managing partner who received the subscription money provides statements from the receiving account showing it arriving, on matching dates and in matching amounts. An Investment Explanation Letter, on a prescribed form, sets out the flow of money from each Thai shareholder into the company.

The point is arithmetic. If a Thai shareholder holds 51 per cent of a company that bought a ฿12 million house, the file should show roughly ฿6 million leaving that person’s account. If nothing left, or the same sum arrived a week earlier from the foreign director and went straight back out, the documents say so on their face.

The Nation has reported that the DBD identified around 119,000 companies, out of roughly a million active businesses, where foreigners hold between 0.01 and 49.99 per cent of the shares, with inspection prioritised on the 40 to 49.99 per cent band. That comes from news reporting of DBD statements rather than a published departmental document we have read, so treat the number as indicative.

Prachuap Khiri Khan is on the list

The DBD named 16 provinces for financial-trail checks: Chonburi, Surat Thani, Phuket, Krabi, Phang Nga, Prachuap Khiri Khan, Chiang Mai, Chiang Rai, Mae Hong Son, Rayong, Bangkok, Samut Prakan, Samut Sakhon, Nakhon Pathom, Nonthaburi and Pathum Thani.

Hua Hin sits in Prachuap Khiri Khan.

The province had appeared once already. In June the Commerce Ministry moved against 140 accountants across eight provinces, Prachuap Khiri Khan among them, suspected of holding shares in nominee-risk firms. The eight-province total was 2,040 companies with foreign investment links and a combined share value of about ฿2.53 billion, concentrated in property, tourism, restaurants and vehicle rental. No breakdown by province has been published that we can find, so be careful with local headlines that attribute all 2,040 to Hua Hin.

Both the province list and the accountant figures come from Thai news reporting, principally The Nation, rather than from primary documents in English. We report them as reported.

How enforcement actually works now

Not raids. Reconciliation.

In May the Department of Lands set out pre-registration checks where a Thai national may be holding for a foreigner: source of funds, the relationship between the parties, and, for companies, the shareholding structure and where the investment came from. After registration, land offices review entities with foreign shareholders quarterly and watch for land use and advertising that suggests foreign control. The department shares data with the DBD, the Anti-Money Laundering Office and the Department of Special Investigation.

That is the shift worth understanding. The shareholder register at the DBD and the title deed at the land office used to be two filing cabinets in two ministries. They are now compared. Your company’s filings, the payment trail behind its shares and the chanote it holds are one record, read by people looking for a specific pattern: no trading income, a foreign director, Thai shareholders with no money movement, and a house.

Who is most exposed

The 40 to 49.99 per cent band, on the DBD’s own stated priority. Companies whose only asset is a residence and whose only activity is owning it. Companies where the Thai shareholders were supplied as part of the purchase. Companies sharing a registered address or a set of shareholders with dozens of others — that is what the accountant investigation was built on. And anyone who needs to touch the registry, because every amendment now triggers the documentary requirement. A director resignation, a share transfer to your children, a sale: each puts the file in front of a registrar.

What a real Thai company looks like

A legitimate Thai company trades. It has customers, revenue, a purpose beyond holding a roof, and Thai shareholders who paid their own money, can show where it came from, receive dividends and can lose their investment if it fails. There is nothing improper about a foreigner owning 49 per cent of a genuine Thai business that happens to own premises. The test is whether the Thai shareholders bear the risk. If they cannot show that they paid, and control sits entirely with the foreign director, the paperwork answers the question without anyone visiting the house.

The honest alternatives

Foreigners buy property in Thailand lawfully every day. The recognised routes are:

• Condominium freehold. Under the Condominium Act, foreigners may hold units in freehold up to 49 per cent of the total floor area of a building. This is outright ownership in your own name.
• A registered lease. The Civil and Commercial Code caps a lease of immovable property at 30 years. Registered at the land office and endorsed on the title, it is a real interest, not a promise. Renewal clauses beyond the initial term have a difficult history in the Thai courts.
• Usufruct and superficies. A usufruct gives you the right to possess and use land for a fixed term or for your lifetime. A superficies gives you the right to own buildings on land belonging to someone else. Both are registrable against the title.

You will also read about 99-year leases and a higher condominium quota. As things stand these are proposals under government consideration, not law. Do not let anyone sell you a house on the strength of them.

None of these is offered here as a substitute for what you have, and none is automatically appropriate. Each carries its own conditions, costs and failure modes, and each can itself be done badly.

If you are already in one

Get your own Thai lawyer — not the one the agent introduced, not the accountancy firm that supplied the shareholders, not the developer’s in-house counsel. Their interests are not yours, and in some cases they are the party under investigation.

Ask that lawyer to establish what your file actually shows: who paid for the shares, what the bank records evidence, what the company has filed, and what happens the next time you register anything. That is a factual assessment, and it comes before any decision.

If you are being offered this structure today by an agent who says everybody does it here, that is not a legal opinion. It is a sales technique, and the person carrying the criminal exposure is you.

Where we come in

We help people understand Hua Hin before they commit to it — which neighbourhoods work, what things cost, and what to ask before money moves. On this subject our role is narrow: we tell you what we are seeing on the ground and point you to independent Thai legal counsel. We are not lawyers, we do not give legal advice, and nothing here is a substitute for it.