The Thai government has agreed in principle to amend the Foreign Business Act, a move aimed at relaxing regulations that currently restrict foreign ownership and investment. The decision, made by the cabinet on April 22, 2025, is intended to modernize the country’s legal framework to align with evolving global economic conditions and attract more foreign investors.
The 1999 legislation has been widely criticized by economic reform advocates for being overly protectionist and limiting Thailand’s competitiveness. Responding to these concerns, the cabinet has directed the Ministry of Commerce to draft proposed changes that would reduce barriers to foreign participation in Thai businesses.
According to a statement from Deputy Government Spokesman Karom Polpornklang, the amendments are particularly significant for emerging sectors such as technology startups, which often rely heavily on foreign capital and innovation. The Law Reform Commission, operating under the Council of State, emphasized the need to revise laws that constrain the growth of industries poised to contribute substantially to the country’s GDP.
Currently, foreign investors are restricted to a 49% ownership limit in most Thai-registered companies. This cap has led to workarounds, including the use of Thai nominee shareholders, which have raised legal and ethical concerns. The Ministry of Finance has recommended a thorough revision of these ownership rules, focusing on both the types of businesses available to foreign investors and the ownership thresholds.
The amendment proposal has received support from several key government bodies, including the ministries of Finance, Commerce, Interior, and Labour, as well as the National Economic and Social Development Council and the Board of Investment. The revised law is expected to shift from a framework of protectionism to one that aims to support domestic businesses by improving their competitiveness on a global scale.
Officials, including Deputy Spokesman Karom and Prime Minister Paetongtarn Shinawatra, who addressed the topic during the “Ignite Thailand” investment forum held in Bangkok on March 24, 2025, have signaled the government’s commitment to economic modernization.