Ministries unite to tackle foreign land ownership through nominees

The Commerce and Interior Ministries are collaborating to prevent nominee companies from holding land and engaging in prohibited businesses.

A memorandum of understanding (MoU) between the Department of Business Development (DBD) and the Department of Lands (DOL) was signed on Thursday, focusing on the exchange of information to prevent foreigners from exploiting legal loopholes.

Napintorn Srisunpang, Deputy Minister of Commerce, stated that currently, foreigners are acquiring land in Thailand by having Thai nationals hold the land on their behalf to circumvent legal restrictions.

He added that some of this land is being used for prohibited activities, such as businesses forbidden to foreigners or those in which Thai entrepreneurs are not yet ready to compete. This distorts market mechanisms and negatively impacts the country’s economic and social security.

“Foreigners often establish legal entities where Thai nationals are the registered owners, but foreigners hold shares, then purchase land and use it for prohibited businesses such as agriculture, accommodation services, and food and beverage enterprises,” he explained. Under this cooperation, the DBD will provide the DOL with lists of legal entities deemed high-risk, to assist in land ownership approval and to prevent further land acquisition by foreigners through nominees.

An ongoing investigation has identified 46,918 high-risk legal entities with foreign shareholders holding between 0.001% and 49.99% in six vulnerable sectors. Among these, 26,038 entities (55.49%) are involved in land trading and real estate.

Songsak Thongsri, Deputy Minister of Interior, emphasised that the DOL prioritises preventing distorted land ownership. This collaboration will enable the department to access information on potentially nominee companies and help prevent foreigners from exploiting legal loopholes dishonestly.Pornpoth Penpas, director-general of the DOL, said that previous problems arose because legal entities changed shareholders, with foreigners acquiring shares directly or via Thai nominees, creating legal gaps allowing foreigners to hold land.

He believes that cooperation with the DBD will provide real-time data on whether companies purchasing and holding land are truly Thai-owned or effectively foreign-owned via nominees, thereby improving land ownership oversight.

“If land ownership has already been approved, we will conduct in-depth investigations. If violations are found, we will refer cases to relevant agencies for action,” he said.

He added that the DOL is considering increasing penalties for illegal foreign land ownership. Currently, the 1954 law imposes a two-year prison sentence and a 20,000 baht fine, but these penalties will be strengthened and modernised.

Pornpoth expressed confidence that the Anti-Money Laundering Office (AMLO) is drafting new legislation with the DBD to classify nominee offences as predicate crimes, enabling asset forfeiture. 

This will better address foreign land ownership issues, which previously only allowed forced sale and return of funds to foreigners, he said.

(2025/05/22-00:00)