Ministry outlines plan to crackdown on nominee businesses
Foreign business using Thai nominees to face severe penalties under new plans, Commerce Ministry subcommittee says
The Commerce Ministry has laid out a plan to tackle foreign businesses that use Thai nominees to operate in Thailand in violation of the Foreign Business Act of 1999 in the short, medium, and long terms.
The ministry’s subcommittee on nominee business prevention and suppression held a meeting on Wednesday with related agencies to discuss measures to investigate and pursue legal action against companies suspected of using Thai nominees, deputy minister Napintorn Srisanpang, who chairs the committee, said.
Joining the session were representatives from the Department of Special Investigation, Central Investigation Bureau, Anti-Money Laundering Office, and related agencies.
The meeting approved the plan for the short, medium and long terms. For the short-term plan, related agencies will use existing laws to intensively monitor, investigate, and interrogate businesses suspected of using a nominee, as well as pursue legal action against the nominees, said Napintorn.
In the medium term, the Department of Business Development will develop a system to analyse the behavioural trends of businesses in Thailand in order to detect irregularities that indicate the use of nominees. The system is expected to be completed within six months, he said.
In the long term, the ministry will consider amending relevant laws to allow the Department of Business Development to refuse or invoke business registration if the companies are deemed high-risk under anti-money laundering and related laws.
Napintorn pointed out that currently the department can turn down business registration in two cases: when the company directors are bankrupt or legally incompetent.
“We will also consider amendments to the Foreign Business Act to increase penalties for nominee practices, in order to deter such illegal actions,” he said, adding that the amendment should take no less than one year.
“The government treats the issue of nominee practices as top priority, as it harms Thai businesses and damages the economy,” said Napintorn. “I urge Thai individuals who are involved in nominee practices to stop this behaviour and forward any information to the authorities. You will be protected as witnesses, which will help reduce the severity of the offence.”
