Warning Thai people: Don’t be a nominee for foreign business

The Director-General of the Business Development Department in Thailand announced that Thai citizens who allow their names to be used by foreigners to open businesses that are reserved for Thai nationals may face penalties. The punishment can include hefty fines starting at 100,000 baht and climbing as high as 1 million baht. Violators could also face imprisonment for up to three years for Thai nationals acting as nominees.

The Director-General was responding to recent news that Chinese businessmen had been buying up a number of food shops in the Chinatown area of Thailand. He clarified that foreigners are not permitted to open businesses that sell food or drinks, and that those who wish to do so must first obtain permission from the Business Development Department.

Additionally, Thai citizens who co-invest in such businesses with foreign partners must provide bank statements to show that they have the financial means of available liquid capital. They are required to prove that they have the financial resources to co-invest and that they are not simply acting as nominees to allow foreigners to open businesses that would otherwise be forbidden to them.

Before authorities go after foreign businessmen accused of using Thai citizens as nominees, clear evidence must be provided. Thai PBS World reports that to prove a nominee is not acting in good faith, the Thai partners must consciously choose to be used in this manner and have hidden the truth of the situation to assist the foreigners.

The Director-General also stated that the Business Development Department has partnered with the Ministry of Labour on investigations of businesses. They check companies that have foreigners as partners or shareholders to ensure that they are properly registered.