For anyone who owns property in Thailand through a nominee structure, or who has considered using one, the latest announcement from Thai authorities is worth close attention.
The Royal Thai Police and the Ministry of Interior have outlined a coordinated, multi-phase enforcement campaign targeting illegal foreign activities, with specific focus on nominee businesses, illegal employment and foreign nationals using Thai citizens to hold land or operate businesses that compete with locals.
National police chief Pol Gen Kittharath Punpetch ordered the measures on May 12, including an urgent three-month campaign aimed at eradicating transnational crime and other illegal activities by foreigners, according to the Bangkok Post.
What the crackdown includes
The enforcement plan has three phases and involves multiple government agencies, including the ministries of Commerce and Finance, the Anti-Money Laundering Office, the Bank of Thailand, the Customs Department, the Excise Department and the Department of Land.
Police spokesman Pol Lt Gen Trairong Piwpan said the focus areas include preventing transnational crime, illegal immigration, use of Thailand as a transit point or hiding place for criminal activities, and “illegal employment or nominee businesses that affect the people’s livelihood and national order.”
The first phase instructs all police units to inspect foreigners within their jurisdictions, compile databases and identify target groups linked to drug trafficking, economic crimes, tax offences, customs or corporate offences, cybercrime, illegal immigration networks, prostitution, human trafficking and individuals posing threats to society.
The Royal Thai Police also announced plans to establish a joint task force with related agencies to drive operations at both policy and provincial levels.
Medium-term measures and database integration
In the second phase, scheduled for six to nine months, the Immigration Bureau will lead operations with relevant agencies to inspect foreigner databases, verify documents and evidence, review visa extension requests and examine foreign business operations.
If wrongdoing is found, metropolitan and provincial police units and security agencies are instructed to enforce applicable laws and consider revoking permission for foreigners to remain in Thailand.
Authorities are also instructed to study related laws and propose amendments or improvements to strengthen law enforcement efficiency and close loopholes exploited by foreign offenders.
Nationwide, police were ordered to expand investigations into all associated criminal networks under an “uproot and eradicate” approach. If state officials are found involved or complicit, strict legal and disciplinary action is required immediately.
The plan includes developing a comprehensive foreigner database system covering inspections and immigration status, integrated with the Royal Thai Police’s OnePolice system. The system will connect databases down to local levels and enhance coordination and information-sharing with foreigners’ home countries.
Ministry of Interior focuses on nominee arrangements
Separately, the Ministry of Interior is preparing to propose to the Cabinet the establishment of a national policy committee and local-level mechanisms specifically to tackle nominee business arrangements.
Passakorn Boonyalak, deputy permanent secretary of the ministry, chaired talks with relevant agencies on May 12 to accelerate efforts to address the increased number of foreigners settling in Thailand and dominating local businesses.
Mr Passakorn identified ongoing conflicts in various regions of the world prompting migration to Thailand, along with visa exemption policies that have made entry easier, as contributing factors.
He specifically mentioned concern about foreign nationals using Thai citizens as nominees to purchase or hold land and real estate, as well as operate businesses that compete with locals, and foreigners working without permits.
Affected industries include hotel and accommodation businesses, hospitals, private universities, restaurants and other services businesses.
The government views these issues as urgent problems requiring swift action, as they could lead to the formation of influential groups, criminal activities and the use of the country as a base for various illegal operations, Mr Passakorn said.
What this means for foreign property buyers in Phuket
Thailand’s Foreign Business Act and land ownership laws have long restricted foreign ownership of land. Foreign nationals can own condominium units in freehold, but only if foreign ownership in the building does not exceed 49% of total saleable area. They cannot own land in freehold unless specific exceptions apply.
This has led some foreign buyers to structure ownership through Thai limited companies where Thai nationals hold the majority of shares as nominees—shareholders in name only, without genuine investment or control.
Thai law prohibits nominee arrangements. The legal risk has always existed. What is changing is the stated enforcement priority and the coordination across multiple agencies, including the Department of Land, the Anti-Money Laundering Office and the Immigration Bureau.
The three-phase structure, database integration and the Ministry of Interior’s specific focus on nominee land and real estate holdings suggest a more systematic approach than previous sporadic enforcement.
For foreign buyers who own Phuket property through a Thai company structure, the question is whether that structure is legally sound. If the company was formed with genuine Thai shareholders who made real capital contributions and have actual control, the structure may be defensible. If the Thai shareholders are nominees holding shares without genuine economic interest, the structure may violate Thai law.
The announcement also mentions reviewing visa extension requests and examining foreign business operations. This suggests possible scrutiny of long-stay visa holders and those operating businesses in Thailand.
What remains unclear
The announcement outlines enforcement priorities and phases but does not specify how nominee investigations will be conducted, what evidence will be examined, or what penalties may apply.
It is not yet clear how the Department of Land will integrate its records with the Immigration Bureau and the Anti-Money Laundering Office, or what triggers an individual case review.
The Royal Thai Police said the measures would “align appropriately with the government’s tourism policy,” but the practical balance between enforcement and tourism promotion is not defined.
The timeline for the first phase is three months. The medium-term phase is six to nine months. What follows after that is not specified.
Frequently Asked Questions
What is a nominee arrangement in Thai property ownership?
A nominee arrangement typically involves foreign nationals using Thai citizens to hold majority shares in a Thai limited company for the purpose of owning land or real estate. The Thai shareholders hold shares in name only, without genuine investment or control. This structure is illegal under Thai law.
Does this crackdown affect all foreign property buyers in Phuket?
The crackdown specifically targets illegal nominee arrangements and foreign business operations that violate Thai law. Foreign buyers who own condominium units in freehold under the legal 49% foreign quota, or who hold property through legally structured Thai companies with genuine Thai shareholders, are not the stated target.
What agencies are involved in the enforcement campaign?
The Royal Thai Police, Immigration Bureau, Ministry of Interior, Department of Land, Anti-Money Laundering Office, Bank of Thailand, Customs Department, Excise Department and the ministries of Commerce and Finance are all involved in the coordinated enforcement effort.
What should foreign property owners do now?
Foreign property owners in Thailand should review their ownership structure with qualified Thai legal counsel to ensure compliance with current law. If the structure relies on nominee arrangements, legal advice is essential. The announcement suggests increased enforcement priority and database coordination across multiple agencies.
Will this affect Phuket tourism or foreign investment?
The Royal Thai Police stated the measures would align with the government’s tourism policy, but the practical impact on foreign confidence, long-stay visa holders and property investment is uncertain. The focus appears to be on illegal activity, not legal foreign ownership or tourism.
Sources
- The Phuket News — Thailand moves to uproot illegal foreign activities — link
- Bangkok Post — referenced as primary source within The Phuket News article
