Transcript of the above video:

In a number of videos in the past, we have discussed the issue of nominee shareholders in Thailand. It is something that quite honestly lawmakers as well as policy makers, as well as Law Enforcement take rather seriously especially as it pertains to setting up companies that are utilized to own real estate. I've talked about that in many prior videos. There have been developments here recently where we have seen serious law enforcement efforts to stop that and we have actually seen criminal penalties apply to corporations that were deemed to be nominee structures especially in the context of real estate holding companies effectively.

And as I have discussed in many other videos, there may be a limited subset of fact patterns where setting up a corporate structure to hold real estate might be a viable way of doing things here and it might be considered legal and within the bounds of the law, but unfortunately, especially in places where less than reputable operators are trying to sell people on real estate, especially foreigners, because they can get a lot more money oftentimes - the higher price, they are sort of viewed as able to pay higher prices - unfortunately there are a lot of these kind of company setups that are quite illegitimate. And especially as it pertains to property, Thai law enforcement takes it seriously and digitization is causing law enforcement to have the tools at their disposal to really go after these kind of structures. 

I thought of making this video after reading a recent article from the Bangkok Post, bangkokpost.com, the article is titled: New system to help screen nominee businesses. Quoting directly: "This group will accelerate inspections of potentially risky legal entities, particularly those with foreign shareholders holding between 0.001% and 49.99%, totalling 46,918 entities." So that is like basically any entity that has a foreign shareholder on it, could be subject to these inspections." Quoting further: "The time frame of these inspections will vary from one month to one year, depending on the number of entities in each province." So again, it's early days on this, it remains to be seen. As I have discussed in other videos, the whole notion of a nominee is something of a nebulous legal notion. There are certain types of operations that are going to have shareholders on them that are involved in a business in different ways. I mean there is no one-size-fits-all way to do business and invest in a corporation here in Thailand. That said, again as I have discussed in other videos, the main impetus behind this seems to be property holding companies. As we have discussed, they have raided different operations here in Thailand to go after companies or individuals that they believe were setting up companies to allow foreign nationals to effectively own land through corporate structures. I expect that will be the main thrust of these inspections and investigations moving forward. It remains to be seen exactly how this plays out. That said, structuring a company correctly here in Thailand is really key and how it is set up and the facts and circumstances underlying the corporate setup will drive the legal analysis regarding whether or not it is a lawful entity and its purpose is legitimate. 

That said, two big areas to really watch out for, again real estate holding companies and also as discussed in prior videos, tourism. The tourism sector is considered a heavily protected industry here in Thailand and therefore, if a corporation is deemed to be set up to allow foreigners to operate in the tourism sector, it's oftentimes going to be scrutinized I would say for lack of a better term, in a very negative light. 

So the thing to take away from this video and understand is look, you not only want to do things the correct way, you want to understand that a) you don't want to set up a structure that is purely designed to circumvent Thai Laws and rules regarding foreign ownership of property, but you have also got to be clear in even operational companies, that these type of shares structures are set up in such a way that you are not going to get into issues with regard to anti-nominee provisions here in the Kingdom of Thailand.