Commerce Ministry denies foreigners can run hotels and restaurants without a licence
The Commerce Ministry has denied that a new regulation lets foreigners run hotels, restaurants and tour businesses in Thailand without a licence, calling the claim fake news.
The regulation frees eight service businesses, in three groups, from the licensing requirement under the Foreign Business Act of 1999. Posts circulating online said it covered seven businesses close to Thai livelihoods, including hotels, tour operators, restaurants, souvenir shops, sports services and language schools.
“These seven businesses are not in the regulation at all,” said Poonpong Naiyanapakorn, director-general of the Department of Business Development.
Critics had also accused the ministry of surrendering economic sovereignty, hurting Thai SMEs and leaving no safeguard against nominee companies. Poonpong said dropping the licence requirement was not liberalisation, because sector rules and regulators still applied. The aim, he said, was to remove duplicate paperwork.
The eight businesses
The first group covers four businesses that already answer to their own regulator:
- Telecom services by operators without their own network, licensed by the NBTC. The regulator has issued 525 such licences, 171 of them to foreign firms, and foreign operators will still need an NBTC licence.
- Treasury centres, regulated by the Bank of Thailand. The central bank said they serve only companies in the same group and do not compete with Thai firms.
- Securities-backed lending, regulated by the Securities and Exchange Commission.
- Agent, adviser and fund manager services for derivatives outside the Derivatives Act, also under the SEC. The SEC said Thai operators were ready to compete and had itself proposed the delisting.
The second group covers services provided only between affiliated companies: administrative, human resources and IT services, and domestic debt guarantees. Officials had approved every application in this category, 334 in all, so Poonpong said the licence step served no purpose.
The third group covers two narrowly defined businesses. One is renting part of a company’s own premises for ATMs or vending machines for staff, aimed at foreign firms with workforces of 1,000 to 2,000 people. The other is petroleum drilling services, which the Energy Ministry, the Petroleum Institute of Thailand and PTT Exploration and Production agreed to delist, citing the need for more providers and the high technology and capital involved. No Thai company offers offshore drilling.
Not the first time
The Cabinet approved removing nine businesses from the act’s annex in May. Eight are handled by ministerial regulation and one, agricultural futures trading, by royal decree.
Poonpong said the annex had been trimmed five times before, each time after consultation with and approval from the regulators concerned. The Foreign Business Board is required by law to review the list at least once a year.
Nominee crackdown
On the nominee concern, Poonpong pointed to a Central Partnership and Company Registration Office order in force since 1 August that tightened the documents required from companies with foreign investors or signatories.
The department treats new companies with foreign shareholdings of 0.01% to 49.99% as a nominee risk. Registrations in that band fell to 163 in August from 894 a year earlier, a drop of 81.77%.
Of the 163, about 100 appear to be genuine Thai-foreign joint ventures, Poonpong said. The department has asked the directors and shareholders behind the other 63 to explain themselves, and will take legal action if it finds irregularities.
In similar news
- Thailand nominee crackdown cuts new filings by 75%
- House committee presses crackdown on foreign nominee property in Pattaya
- Thai senator proposes 100% foreign ownership as nominee fix
Source:
The story Hotels and restaurants are not in foreign business licence exemption as seen on Thaiger News.
