The Foreign Business Act and Restricted Business Lists in Thailand (2026 Guide).

The short version: one law decides who needs a Thai partner

Almost every question about foreign ownership in Thailand comes back to a single law: the Foreign Business Act B.E. 2542 (1999), administered by the Department of Business Development (DBD) under the Ministry of Commerce. It defines who counts as a foreigner, lists the businesses foreigners cannot freely run, and sets the penalties for getting it wrong.

Understanding the Act is the first step in setting up a company in Thailand as a foreigner, because it tells you whether you need a Thai majority, a licence, or one of the routes around it. This guide walks through the "foreigner" definition, the three restricted lists, the licence, and the penalties, in plain language.

Who the law counts as a "foreigner"

The Act does not just mean people with foreign passports. It also classifies companies. A business is treated as a foreigner if it is:

• a person who is not Thai, or
• a company not registered in Thailand, or
• a company registered in Thailand with half or more (50% or more) of its shares held by non-Thais.

That threshold is the heart of the system. A Thai limited company with more than 50% Thai shareholders is treated as Thai and can trade freely. The moment foreign ownership reaches 50%, the company becomes foreign and needs permission to run any restricted activity. This is why so many structures are built at 49% foreign and 51% Thai, and why those Thai shares have to be held by genuine investors rather than nominees.

The three restricted lists

The Act sorts restricted activities into three lists, annexed as schedules. Each list has a different rule.

List 1: closed to foreigners

These businesses are reserved for Thai nationals, and no licence is available. They include newspapers and broadcasting, rice and crop farming, livestock, forestry from natural forest, fishing in Thai waters, extraction of Thai herbs, trading in Thai antiques and national heritage objects, making Buddha images and alms bowls, and trading in land.

List 2: needs Cabinet approval

These are activities tied to national security, Thai arts and culture, or natural resources. They include domestic transport, firearms and explosives, traditional Thai crafts (such as carved wood, Thai silk, and Thai musical instruments), mining, and timber processing. A foreigner can run a List 2 business only with Cabinet approval, and usually only with significant Thai shareholding and Thai directors.

List 3: needs a licence

This is the list most foreign founders meet. List 3 covers activities "where Thai nationals are not yet ready to compete," and it is broad: accounting, legal, architecture, and engineering services, advertising, brokerage and agency, construction, hotel operation (except hotel management), tour guiding, selling food and drink, much of retail and wholesale below certain capital thresholds, and a catch-all final item, "other service businesses." A foreigner can run a List 3 activity with a Foreign Business License from the DBD.

That final catch-all is the one to watch. "Other services" is wide enough that many ordinary service companies fall inside List 3 without realising it, which is why classifying your activity correctly matters before you choose a structure.

License or certificate: two different documents

People use "licence" loosely, but the Act has two separate documents.

• A Foreign Business License (FBL) is permission the DBD grants to run a List 2 or List 3 activity as a foreign company. It is discretionary: the authorities weigh the application and can refuse it.
• A Foreign Business Certificate (FBC) recognises a right you already hold under a treaty or another regime. A company promoted by the Board of Investment, or an American company under the Treaty of Amity, applies for a certificate rather than a discretionary licence.

The difference is real money and real risk: a certificate confirms a right, while a licence is an application that can be turned down.

The ways around the lists

Being inside List 3 does not mean you are stuck with a Thai majority. There are three main ways a foreigner runs a restricted business as a foreign-majority company:

• BOI promotion, if the activity is one the Board of Investment promotes. This also brings tax and other incentives.
• The Treaty of Amity, if the owners are American. See the Amity treaty guide.
• A Foreign Business License, applied for directly with the DBD when neither of the above fits.

And of course, a business that is not named in any list (a lot of manufacturing and export work) carries no foreign-ownership restriction at all, so a foreigner can own 100% with no licence.

Minimum capital under the Act

The Act also sets minimum capital for foreign companies. A foreigner running a non-restricted business needs at least 2 million THB in registered capital. A foreigner running a restricted business that requires a licence needs at least 3 million THB for that activity. The capital is not just a number on the registration: it has to be brought into Thailand within the timeframe the rules set.

Penalties, including nominee arrangements

The Act is enforced, and the penalties are criminal, not just administrative.

• Operating a restricted business without the required licence can bring imprisonment of up to 3 years, a fine of 100,000 to 1,000,000 THB, or both. The court can order the business to stop, and continued operation adds a daily fine.
• Nominee arrangements, where a Thai holds shares on a foreigner's behalf to disguise foreign control, are a separate offence that catches both the Thai nominee and the foreigner, with similar penalties. This is covered in detail in the nominee shareholders guide.

These are enforced in practice. The Department of Business Development and the Department of Special Investigation have run repeated checks on suspected nominee structures, particularly in tourism and property.

A reform to watch

The Foreign Business Act is under review. The government has moved, in principle, toward shifting the Act's guiding aim from protecting Thai business toward improving competitiveness, and toward removing the licence requirement from several List 3 service activities. As of mid-2026 these changes take effect only once they are formally published in the Government Gazette, so treat them as proposed rather than current. Before relying on any "no longer restricted" claim, check with the DBD whether the change has actually been gazetted.

How to tell which list you're in

The practical question is rarely "what does the Act say" but "where does my specific activity fall." That turns on how your business is described and what it actually does, and the "other services" catch-all makes it less obvious than it looks. Getting the classification right decides whether you need a Thai majority, a licence, BOI, or nothing at all, so it is the cheapest place to get advice and the most expensive place to guess.

When you are ready, compare foreign business and corporate lawyers and company registration services on Justenda, message them directly, and get a fee quote before you commit.

A note on what this guide is

This is general information to help you understand the Foreign Business Act, not legal advice, and the Act and its lists are being amended. Confirm the current rules with the Department of Business Development or a qualified Thai lawyer before you classify your business or choose a structure.