Foreign Business License Thailand 2025 Guide for SMEs: Who Needs It, Capital Rules, Process, Alternatives, and Risks

Foreign Business License Thailand 2025 Guide for SMEs: Who Needs It, Capital Rules, Process, Alternatives, and Risks

Summary for busy founders

If your Thai company is majority foreign owned and your activity sits in the Foreign Business Act lists, you likely need a Foreign Business License Thailand before operations. The Director General must complete consideration within 60 days of filing for List 3 activities. Licenses are valid until you cease the business. Minimum capital is at least 2 million baht in general, and not less than 3 million baht for businesses requiring permission. Using nominee shareholders to conceal foreign control is a criminal offense. BOI promotion or treaty routes can convert the process into a Foreign Business Certificate with a 30 day statutory issuance timeline after notification.

What is a Foreign Business License Thailand

Under the Foreign Business Act B.E. 2542, a company that is a foreigner for FBA purposes must have a license to conduct restricted activities listed in the annexes. List 1 is completely prohibited. List 2 and List 3 require permission, with List 3 covering many service businesses.

Key point: For List 3, permission is granted by the Director General with approval of the Foreign Business Commission. The decision must be completed within 60 days from the application filing date.

Who is considered a foreigner

A Thai company becomes a foreigner when non Thai persons hold 50 percent or more of its capital, or when it is controlled by foreign juristic entities. That status triggers the FBA restrictions and licensing checks.

Foreign Business License Thailand focus keyword and typical activities in List 3

List 3 covers activities where Thai nationals are not yet ready to compete. Examples include accounting, legal, engineering, advertising, hotel business except hotel management services, and a wide category called other service businesses.

Two trading carve outs to understand:

1. Retail is restricted when the foreign owned company has total paid up capital less than 100 million baht or less than 20 million baht per shop.

2. Wholesale is restricted when less than 100 million baht per shop. Above these capital thresholds, the activity falls outside List 3 items 14 and 15, which can remove the need for an FBL for those trading lines.

Minimum capital rules and timing

Section 14 sets a statutory floor. The minimum capital to start any foreign business must not be less than what the Ministerial Regulation prescribes, and it cannot be less than 2 million baht. Where the business requires permission under the lists, the minimum capital for each such business cannot be less than 3 million baht. Ministerial Regulations may also prescribe the timing for bringing or remitting the capital into Thailand. License validity and display obligations

A license is valid for an indefinite period until the licensee ceases the permitted business. The license or certificate must be displayed in an overt location at the place of business, and relocation must be notified to the registrar within 15 days.

Foreign Business License Thailand process step by step

1. Confirm status and scope Determine whether your entity is foreign for FBA purposes and map your activities to the lists and specific items. Use the official schedules for clarity, including List 3 item 21 for other service businesses.

2. Prepare the application pack The Department of Business Development requires an application plus business details, projections, and materials that explain economic benefits such as jobs and technology transfer. The official Application Preparation Handbook under the FBA outlines the required structure.

3. File with the Department of Business Development Applications are made with the DBD at the Ministry of Commerce. There is both in person filing and online access via government channels that route through DBD systems.

4. Committee review and interviews The Foreign Business Committee evaluates your application. The Director General must complete the consideration within 60 days for List 3. If rejected, the Ministry must notify you in writing with reasons, and you have a right of appeal.

5. Issuance and compliance setup Upon approval, display the license, align with any conditions, and set compliance calendars for notifications and capital obligations under Ministerial Regulations.

Typical timeline expectation: The law grants a 60 day consideration window. Practical end to end timelines can run longer due to preparation and clarifications, but the legal anchor remains that Section 17 requires completion of consideration within 60 days from filing.

Alternatives to a Foreign Business License Thailand

Some projects can avoid the discretionary license and rely on a certificate route.

1. BOI promotion route A BOI promoted company that engages in List 2 or List 3 activities notifies the Director General to obtain a Foreign Business Certificate. The Director General must issue the certificate without delay and not later than 30 days after receiving the notification with valid BOI promotion proof.

2. Treaty or special law route A foreigner operating under a treaty or other law, for example the U.S. Treaty of Amity regime or operation within the Industrial Estate Authority, notifies to obtain a certificate rather than a license. The same 30 day issuance rule applies after valid notification.

3. Capital threshold route for trading For retail and wholesale, exceeding the per shop capital thresholds described in List 3 items 14 and 15 can remove the activity from the restricted list, which can eliminate the need for an FBL for those trading lines. This must be carefully documented and monitored at the store level.

Penalties, enforcement, and nominee risk

Operating a restricted business without permission violates Sections 6 to 8 and can result in up to three years imprisonment or a fine from 100,000 baht to 1,000,000 baht, plus daily fines for violating a court order. Violations of Section 14 on minimum capital can trigger fines between 100,000 baht and 1,000,000 baht and daily fines until rectified.

Section 36 prohibits nominee shareholder structures that hide real foreign control. Both the Thai nominee and the foreign beneficiary face criminal penalties and court ordered unwinding of the structure, with daily fines for non compliance. Recent practitioner updates highlight active enforcement attention on nominee issues.

Compliance checklist before you file

• Confirm that your company is an FBA foreigner.

• Map each activity to the schedules and identify the precise list item.

• Determine if BOI promotion or treaty coverage is achievable to convert the pathway into a certificate.

• Calculate required minimum capital and plan remittance timing in line with Ministerial Regulations.

• For retail or wholesale, verify per shop capital against List 3 thresholds and document it.

• Prepare business plan materials that show benefits such as Thai employment and technology transfer.

• Build a compliance calendar for license display, relocation notifications, and ongoing conditions.

Frequently asked questions

Is manufacturing restricted under the FBA Manufacturing is generally outside the restricted lists, so many factories do not need an FBL. Always confirm any embedded services or trading elements.

How long is the license valid A license has indefinite validity until you cease the business, subject to conditions and potential revocation for breaches.

Can I rely on a BOI certificate instead of a license Yes. With valid BOI promotion for a listed activity, you notify the DBD and obtain a certificate within a 30 day statutory window after notification.

Is it legal to appoint Thai nominees to keep foreign ownership under 50 percent No. Section 36 criminalizes nominee arrangements and aiding or abetting to circumvent the FBA.

References you can quote in board packs

• Foreign Business Act English text, including Sections 14, 17, 21, 36 to 39, and the certificate pathway in Section 12.

• Schedules showing List 3 items including retail and wholesale thresholds and other service businesses.

• BOI One Start One Stop service explainer on foreign licenses and rejection notifications.

• DBD application handbook under the FBA for preparation guidance.

Call to action

GENTLE LAW IBL helps foreign founders select the correct pathway, structure capital to meet thresholds, and file defensible applications with clean compliance. Request a 30 minute scoping call with our FBA team to confirm whether you need an FBL or can use a certificate route.