Many foreigners dream of buying a house in Thailand. However, in Thailand, foreigners are generally not allowed to own land. Although a foreigner may, under certain conditions, own a building or a condominium, the land underneath is generally inaccessible to foreign ownership. The Thai Land Code provides for foreign land ownership only in very limited exceptional cases.

The Former Practice: Thai Companies with a Nominee Structure

In the past, foreigners were often advised to set up a Thai company. The company would then purchase the land and the house. On paper, Thai shareholders held at least 51 percent of the shares, while the foreign buyer was officially only a minority shareholder.

The problem: In these cases, the Thai shareholders were not genuine investors, but so-called nominees. They held the shares only in trust for the foreigner. The foreign buyer controlled the company in the background, for example through voting agreements, loan agreements, blank share transfer forms or other internal arrangements.

Such a structure is legally risky. It is considered a circumvention of Thai law, especially if the company does not pursue a genuine business purpose but was only established to hold land for a foreigner. Exactly these structures are now increasingly in the focus of the authorities.

What Has Changed?

In recent years, Thailand has begun to assess nominee structures much more strictly. According to current reports, the government is tightening measures against foreign-controlled nominee companies and money laundering risks. Data between authorities will be linked more effectively, and suspicious company structures are to be investigated more often.

The Thai authority Department of Business Development (DBD) has also stated in its annual report for 2025 that nominee inspections take place particularly in six high-risk sectors. These expressly include land trading and real estate, tourism, hotels and resorts, logistics, e-commerce, warehousing, agriculture and construction. In May 2026 the DBD announced to intensify its crackdown on “nominee businesses,” where foreigners use Thai nationals as proxies to operate businesses illegally.

This means: A company that holds a house or land but does not carry out any genuine operational business activity can now attract attention much more quickly than before.

Why Nominee Companies Are Problematic

A Thai company may generally own land. However, it becomes problematic if this company merely serves as a shell to effectively enable a foreigner to own land. Under the Foreign Business Act, it is prohibited to use Thai persons as nominee shareholders in order to circumvent foreign ownership or business restrictions.

Violations can lead to severe penalties: up to three years’ imprisonment, fines between 100,000 and 1 million Baht, as well as daily fines for as long as the unlawful structure is not removed.

A Thai national who assists, supports, or acts as a nominee shareholder on behalf of a foreigner, in order to enable the foreigner to conduct business in Thailand in circumvention or violation of the law, is subject to imprisonment for up to three years, a fine ranging from THB 100,000 to THB 1,000,000, or both.

There are also risks at the land level. If a Thai shareholder or a Thai company effectively acts only as a representative of a foreigner, this may be considered an unlawful acquisition of land by a foreigner. In such cases, not only corporate law consequences but also land law consequences may arise. The land/house will be sold.

What Happens During an Inspection?

An inspection may concern various points:

The authorities may investigate where the capital of the Thai shareholders came from, whether they are actually economically involved, whether dividends or profits were distributed to them, who actually controls the company and whether the company has a real business operation.

It is particularly suspicious if a Thai shareholder appears in a large number of companies, has not contributed their own capital, plays no genuine role in the company, or if internal contracts indicate that the foreigner exercises full control despite only holding a minority shareholding.

If the authority comes to the conclusion that an illegal nominee structure exists, this may lead to the dissolution of the structure, liquidation of the company, sale of the land or further civil, tax or criminal consequences (see the article by R.W.T. on this topic).

What Can I do if I already have such a structure?

Anyone who already holds a house or land in Thailand through a Thai company with a possible nominee structure should not ignore the situation. Today, the authorities no longer only examine whether, on paper, 51 percent of the shares are held by Thai persons. What matters much more is who provided the capital, who actually controls the company, who economically benefits from the land and whether the company pursues a genuine business purpose.

A first sensible step is always an independent legal and tax review. This should not only examine the company structure, but also the financing, shareholder agreements, loans, powers of attorney, voting agreements, accounting, tax returns and the actual use of the property.

1. Legal Assessment: Is It Really a Nominee Structure?

Not every Thai company with foreign participation is automatically illegal. During an assessment, the following points may be particularly relevant:

• Who financed the company?
• Did the Thai shareholders contribute their own money?
• Who controls the bank accounts?
• Who signs contracts?
• Who decides on the sale, rental or use of the property?
• Are there blank share transfer forms, voting agreements or side agreements?
• Does the company have a genuine business operation or does it only hold a house?

Only after this analysis can it be properly assessed whether restructuring, sale or liquidation should be considered.

2. Remove Nominees and Use Genuine Thai Shareholders

One possible option is to remove nominee shareholders from the company and replace them with genuine Thai shareholders. This could, for example, be a Thai spouse, a family member or an actual business partner.

However, it is important that the new Thai shareholder must be genuinely economically involved. It is not sufficient simply to replace the previous nominee with another person if that person is again only a shareholder on paper. A spouse must also not merely be used as a new nominee. This solution may make sense if there is actually a family or business structure. However, it is not a simple cure for an illegal past.

3. Convert the Company into a Genuine Operating Business

Another possibility is to no longer run the company merely as a real estate holding company, but to convert it into a genuine operating business. This may make sense if a legal business is actually being operated, such as rental, hospitality, tourism, management or another permitted business. However, the structure must also have substance. This includes genuine business activity, proper accounting, real income, genuine Thai participation, traceable capital flows, correct tax declarations and management that does not exist only on paper.

This option is not suitable if an artificial business purpose is merely created afterwards in order to justify a pure house-holding company.

4. Sale of the Property and Subsequent Liquidation of the Company

If the house does not necessarily have to be kept, selling the property may be a possible solution. The company can then be liquidated. This option is often a clean solution if the company has no genuine business purpose and was only established to hold land for a foreigner.

Yet, several points must be reviewed, in particular the sale price, land transfer fees, taxes, outstanding loans, accounting, company debts and the distribution of any liquidation proceeds.

This option should not be understood as a simple “sell the house and close the company” step. It must be carefully reviewed from a legal perspective and involves administrative work.

5. Reorganise the Ownership Structure

In certain cases, it may be examined whether the property can be removed from the company and restructured in a legal way. For example, a transfer of the land to a Thai person may be considered, combined with a legally permissible right of use for the foreigner. A separation of house ownership and land ownership or a leasehold structure may also be examined depending on the situation.

These options are not discussed in detail, as they have their own legal requirements. Further information can be found in our separate blog post (leasehold, condominium, etc.). The most important point is: They must not simply represent a new, concealed nominee structure. The critical factor always remains that the economic reality corresponds with the legal structure.

6. Examine Special Cases

In certain cases, special structures or approvals may be relevant, for example in connection with Board of Investment (BOI) promotions, large investments or certain commercial projects. For private house buyers, however, such exceptions are usually not realistic. Nevertheless, it may be worthwhile to have them briefly reviewed in more complex cases, especially if the property is connected with a genuine business activity.

Conclusion: Do Not Wait, but Clean Up the Structure Professionally

Thailand has controlled nominee companies only to a limited extent for a long time. That time appears to be over. Anyone who already holds a Thai company with a possible nominee structure should not ignore the situation. As described, there are usually several possible courses of action. Which solution makes sense depends heavily on the individual case.

Affected persons should not make rushed self-corrections. Subsequent document adjustments, backdated contracts, artificial cash flows or the quick replacement of nominees without legal review are particularly risky. Such measures can worsen the situation.

A more sensible approach is an orderly process: First, all documents should be collected and the existing structure reviewed by legal and tax experts. Afterwards, it can be decided whether restructuring, sale, liquidation or another legally permissible solution is best suited. A voluntary, clean and professionally accompanied restructure is generally better than a forced solution under pressure from the authorities.

This article does not replace legal advice. Anyone affected is welcome to contact us for individual advice from a specialised lawyer and tax advisor.