# Thai company ownership of land: the nominee risk explained

Source: https://www.thailandpropertyinvestor.com/guides/thai-company-ownership-risks
Updated: 2026-11-14
Publisher: Thailand Property Investor (Omnia Capital Group)

## The short answer

A Thai company may own land only if it is Thai in substance as well as on paper. Where Thai shareholders hold their shares on behalf of a foreigner, the structure is a nominee arrangement: a criminal offence under the Land Code and the Foreign Business Act, punishable by prison and fines, with the land ordered to be sold. Enforcement tightened in 2026, and Land Offices now examine how Thai shareholders funded their shares. Lawful company ownership needs real Thai investors, real capital and a real business.

## Key points

- A company is treated as foreign under the Land Code if foreigners hold more than 49% of its capital or make up more than half of its shareholders.
- Holding land as a nominee for a foreigner carries up to two years in prison, a fine, or both under Section 113 of the Land Code.
- The Foreign Business Act adds up to three years in prison and a fine of THB 100,000 to THB 1 million for nominee shareholding.
- Land found to be held unlawfully must be disposed of within a period set by the Department of Lands, between 180 days and one year.
- A Department of Lands circular of 15 May 2026 ordered checks on how Thai shareholders funded their shares and monthly reviews of companies with foreign involvement.
- A foreigner who wants a villa has lawful alternatives in a registered lease, superficies or usufruct held in their own name.

Thai law does not let a foreigner own land, and it does not let a foreigner do so indirectly by standing behind a Thai company. A company whose Thai shareholders hold their shares for a foreign buyer is a nominee structure. It is illegal, the penalties are criminal, and the land can be ordered to be sold. These structures have long been offered to villa buyers as a routine way to obtain freehold. They are not safe, and in 2026 the authorities are looking for them.

## Why buyers are offered a company

The pitch is simple. A foreigner wants [freehold](https://www.thailandpropertyinvestor.com/glossary/freehold) land. A Thai limited company can own land. So an agent or law office forms a company in which the buyer holds 49% and Thai individuals hold 51%. The Thai shareholders pay nothing, sign blank share transfers or proxies, and take no part in the business. The buyer is the sole director and controls everything.

On the register the company looks Thai. In substance it is foreign, and the Thai shareholders are [nominee shareholders](https://www.thailandpropertyinvestor.com/glossary/nominee-shareholder). That gap between form and substance is what the law punishes.

## What the law says

**Land Code.** Section 86 bars foreigners from acquiring land except under a treaty, and no such treaty is in force. Section 97 treats a company as foreign if foreigners hold more than 49% of its registered capital or make up more than half of its shareholders. Section 98 extends that to companies held through other foreign-classified companies.

| Section | Who it catches | Penalty |
|---|---|---|
| 111 | A foreigner who acquires land in breach of Section 86 | Up to two years in prison, a fine of up to THB 20,000, or both |
| 112 | A juristic person that acquires land unlawfully or breaches the permitted use | A fine of up to THB 50,000 |
| 113 | Anyone who acquires land as agent or nominee for a foreigner or a foreign-classified company | Up to two years in prison, a fine of up to THB 20,000, or both |
| 94 | Land acquired unlawfully | Must be disposed of within a period set by the Director-General, from 180 days to one year, failing which the Director-General may sell it |

**Foreign Business Act.** Section 36 makes it an offence for a Thai national or Thai company to hold shares on behalf of a foreigner so that the foreigner can operate a restricted business, and for the foreigner to agree to it. The penalty is up to three years in prison, a fine of THB 100,000 to THB 1 million, or both. The court orders the shareholding to end, with a daily fine of THB 10,000 to THB 50,000 for non-compliance.

**False statements.** The 2026 Department of Lands circular also cites the Penal Code offences of making false statements to officials at the [Land Office](https://www.thailandpropertyinvestor.com/glossary/land-office) and causing false entries in official documents.

The fines are small. The real exposure is a criminal record, loss of control over the timing and price of a forced sale, and the collapse of a structure on which the whole purchase price rests.

## How enforcement works in 2026

The legal position is old. What has changed is the effort put into finding breaches.

- **April 2023.** A Ministry of Interior circular set up fact-finding and investigation committees in each province.
- **15 May 2026.** An urgent Department of Lands circular ordered an enhanced enquiry into Thai buyers, and into the Thai shareholders of corporate buyers, where the cash price is THB 2 million or more or the appraised value is THB 5 million or more. Officers examine where the money came from, income, financial standing and occupation. Every company with a foreign shareholder or foreign director is reviewed monthly, with quarterly reports, and officers look for capital increases or rotations of shareholders that suggest land is being held for foreigners. Eight provinces are named as priorities: Phuket, Surat Thani, Mae Hong Son, Chiang Mai, Krabi, Chonburi, Rayong and Chanthaburi.
- **25 August 2026.** A further Ministry of Interior circular added agencies such as the local police to the provincial committees, required Land Offices to screen and flag companies showing nominee risk indicators, and set two tracks. Where an entity is found to be foreign under the Land Code, the governor fixes a deadline to dispose of the land. Where an entity was set up to hold land for a foreigner, land officers must file a criminal complaint and pursue it to final judgment.

The Department of Business Development is running a parallel exercise under the Foreign Business Act. By May 2026 it had identified 118,016 companies with foreign shareholdings between 0.01% and 49.99%, and listed 6,551 entities for in-depth investigation, with Thai shareholders' funding reviewed through bank statements. Cases involving land are passed to the Department of Lands.

The August circular also exposes Thai nationals and professionals who arrange these structures to potential criminal liability.

## Signs that a structure is a nominee arrangement

No single feature is conclusive. Together these are the facts an investigator, or your own lawyer, will look for.

- The Thai shareholders are employees of the law firm, accountant or agent that formed the company.
- They paid nothing for their shares, or were lent the money by the foreign buyer.
- They have signed undated share transfers, proxies or powers of attorney.
- Share classes or voting rights are arranged so that 49% of the capital carries control.
- The company has no business, no revenue and no staff. Its only asset is the house.
- The foreign buyer paid the whole price, shown in the accounts as a director's loan.

## What lawful company ownership requires

A Thai company can own land lawfully. The test is whether it is what it appears to be.

1. **A real Thai majority.** Thai shareholders hold at least 51% of the capital, foreign shareholders do not outnumber them, and they are investors in their own right.
2. **Their own money.** They can show where the funds for their shares came from. This is the first thing officers now ask.
3. **Real rights.** No side agreements that strip their votes, dividends or power to sell.
4. **A real business.** The company trades, files audited accounts and tax returns, and holds the land for that business. An inactive company also risks being struck off the register, which puts its assets in question.
5. **No restricted activity without a licence.** The Foreign Business Act still governs what a foreign-influenced company may do.

A genuine joint venture with Thai partners meets these tests. A holding vehicle for one family's holiday villa almost never does.

Foreign-majority companies can be permitted to own land in limited cases, for example with Board of Investment promotion, for the purposes of the promoted business. From September 2025 the BOI withdrew land ownership privileges from foreign-majority companies in several manufacturing categories. These routes exist for factories and offices, not residences.

## The lawful alternatives

A foreigner who wants a house has no need of a company. The lawful structure is a [lease](https://www.thailandpropertyinvestor.com/glossary/leasehold) of the land registered for up to 30 years, with the building owned separately, supported where appropriate by a [superficies](https://www.thailandpropertyinvestor.com/glossary/superficies) or [usufruct](https://www.thailandpropertyinvestor.com/glossary/usufruct). It gives less than freehold, and the price should reflect that. It is a right the Land Office will register in your own name. See [buying a villa in Thailand](https://www.thailandpropertyinvestor.com/guides/buying-a-villa-in-thailand) and [freehold vs leasehold](https://www.thailandpropertyinvestor.com/guides/freehold-vs-leasehold).

A foreigner who wants freehold can buy a condominium within the [foreign quota](https://www.thailandpropertyinvestor.com/glossary/foreign-quota). See [can foreigners buy property in Thailand](https://www.thailandpropertyinvestor.com/guides/can-foreigners-buy-property-in-thailand).

## If you are buying a resale villa held in a company

Sellers sometimes offer the shares in the company in place of the property, saying it saves transfer taxes. You would inherit the structure, its history and its exposure. Have an independent lawyer review the shareholder register, the funding of the Thai shareholders and the company's filings as part of [due diligence](https://www.thailandpropertyinvestor.com/guides/title-deeds-and-due-diligence). A cleaner course is to take a new registered lease of the property in your own name and leave the company behind. The law here turns on facts and intent, so independent legal advice is essential.

## Questions

### Is a company with 49% foreign and 51% Thai shareholding legal?

The percentages alone do not decide it. Such a company is Thai on its face, but if the Thai shareholders did not invest their own money and hold their shares for the foreigner, it is a nominee structure and unlawful. Officials look at who funded the shares, who controls the company and whether it carries on a real business.

### What happens to land found to be held through nominees?

The provincial governor or the Department of Lands sets a deadline for the land to be disposed of, between 180 days and one year. If it is not sold, the Director-General can sell it. Separately, land officers are instructed to file a criminal complaint where the company was set up to evade the law.

### I already own a villa through a Thai company. What should I do?

Take independent legal advice now, from a lawyer who did not set up the structure. Options usually include converting to a registered lease in your own name or selling. Waiting carries risk: companies with foreign shareholders or directors are now reviewed monthly, and changes in shareholding are monitored.

### Does the nominee problem affect condominiums?

A foreigner can own a condominium unit directly within the 49% foreign quota, so there is no need for a company. Using a nominee company to hold a unit outside the quota raises the same concerns and should be avoided. Take legal advice if a seller suggests it.

### Can my Thai spouse or partner hold the land for me?

A Thai spouse can own land in their own right, and it is theirs. Holding land on behalf of a foreigner is the offence the Land Code describes. If you want protection, register a lease, usufruct or superficies in your own name over the land.

## Sources

- [Tilleke & Gibbins, Ministry of Interior circular of 25 August 2026 on nominee land ownership](https://www.tilleke.com/insights/thailand-tightens-enforcement-against-nominee-land-ownership-by-foreign-nationals/6/)
- [Juslaws & Consult, Department of Lands circular of 15 May 2026 and Land Code Sections 86 to 113](https://www.juslaws.com/articles/foreign-nominee-land-holding-thailand-department-of-lands-circular-may-2026)
- [Foreign Business Act B.E. 2542, Section 36, ThaiLawOnline translation](https://www.thailawonline.com/th/fba-section/section-36-penalty-for-nominees-%e0%b8%a1%e0%b8%b2%e0%b8%95%e0%b8%a3%e0%b8%b2-36-%e0%b9%82%e0%b8%97%e0%b8%a9%e0%b8%99%e0%b8%ad%e0%b8%a1%e0%b8%b4%e0%b8%99%e0%b8%b5/)
- [Terms.law, Land Code penalties, Sections 111 to 113](https://terms.law/Thai/property/land-code-penalties.html)
- [The Nation, Thailand widens crackdown on foreign nominee businesses, 8 May 2026](https://www.nationthailand.com/news/policy/40065956)
- [Tilleke & Gibbins, BOI restrictions on land ownership for promoted companies, January 2026](https://www.tilleke.com/insights/thailand-restricts-foreign-land-ownership-and-shareholding-for-certain-promoted-investments)
- [Siam Legal, buying a house in Thailand (company ownership and delisting risk)](https://www.siam-legal.com/realestate/thailand-buying-house.php)