For decades, some foreign buyers used Thai limited companies to hold land. A company that falls outside Sections 97 and 98 and has genuine Thai investors may lawfully own land; a company in which Thai shareholders merely lend their names or hold shares for a foreigner is a different, prohibited arrangement. The legal result depends on the statutory tests and the substance of the investment, not a 51/49 split alone.
Nominee versions of the structure became common in parts of the Phuket villa market, while genuine operating companies continued to use land for real business activity. In 2026 the Department of Business Development (DBD) tightened registration evidence and authorities conducted new investigations in Phuket and the Andaman provinces.
This article explains that distinction, the dated 2026 enforcement measures, and the questions an existing owner should review with independent Thai counsel. It is general information, not a finding about any individual company.
This is part 1 of a two-part guide. Part 2 covers setting up the company, its cost, and what existing owners should review.
Can a Thai company legally own land in Thailand?
A Thai company may own land only when it falls outside the Land Code’s foreign-company tests and is not acting as a nominee for a foreigner. Section 86 of the Land Code generally restricts foreigners from acquiring land except under the Code or a treaty. Section 97 treats a limited company as foreign for land purposes if foreigners hold more than 49% of its registered capital or foreign shareholders exceed half of all shareholders by headcount. Section 98 treats another juristic person as foreign when a juristic person described in Section 97 holds shares or invests in it in the manner specified there.
A 51/49 registered-capital split is therefore not enough if the shareholder-headcount test is failed, and falling outside Sections 97 and 98 is not a safe harbour for a nominee arrangement.
Section 113 imposes criminal liability on a person who acquires land as owner on behalf of a foreigner or a juristic person under Sections 97 or 98. Section 96 authorises compulsory disposal of land acquired through that representative arrangement and applies the disposal procedure in Section 94. Whether these provisions apply depends on the evidence, not the registered percentages alone.
The legal line between a legitimate Thai-majority company and an illegal nominee structure has always been fact-based and somewhat soft. What changed in 2026 was not the rule; it was the enforcement.
What changed in Thai nominee-company enforcement in 2026?
In 2026, DBD introduced broader capital-trail checks and authorities conducted new investigations, while the underlying Land Code rules did not change. Three dated developments define the 2026 enforcement landscape:
1. The March registration order. DBD Order 1/2569, dated March 16, 2026, introduced an investment confirmation when an existing partnership added a foreign partner or a limited company made a foreigner an authorised signatory director. The confirmation required applicants to affirm that every partner or shareholder actually invested and paid for their interest and that no Thai participant was assisting a nominee arrangement. Order 2/2569 replaced and broadened that registration regime on August 1, 2026.
2. Required financial-trail evidence from August 1. Under Order 2/2569 and its current official forms, specified incorporations and amendments involving foreign investment or signing authority now require bank evidence from the Thai investors and the director receiving the capital. Registrars compare the declared investment with the actual transfers, proportions, and timing; inconsistent information can result in rejection of the registration. DBD said its data review had identified nearly 120,000 foreign-linked companies for further inspection across 16 provinces, including Phuket, Phang Nga, and Krabi. That is a review pool, not a count of illegal companies.
3. The June Andaman operation. A Royal Thai Government report dated June 21 described searches involving 89 land plots across Phuket, Phang Nga, and Krabi, covering 49 rai 1 ngan 6.4 square wah and land and buildings valued at THB 1,053,518,872. The report described 29 companies as showing nominee characteristics and another 48 landholding companies as having more foreign shareholders than Thai shareholders by headcount; it did not describe those 48 as foreign-majority by capital. It also reported 59 arrest warrants and 60 search warrants. Separately, a June 20 media report said screening of more than 30,000 Phuket registrations had placed more than 600 companies in a higher-risk group. Searches, warrants, official suspicions, and screening flags are investigative stages; the cited reports did not announce final convictions for every company or person involved.
The practical change is evidentiary: authorities are asking who supplied the capital, who receives the economic benefit, who controls decisions, and what the company actually does. None of the 2026 measures creates a percentage-based safe harbour, and a risk flag alone does not prove a nominee offence.
For the dated evidence rather than a compressed evergreen summary, see Houseviser’s reports on the August DBD capital-trail rules and the June Andaman searches. They distinguish registration checks, screening, allegations, warrants, and final findings.
What does a legitimate Thai company holding land look like?
A legitimate company has genuine Thai investors, real economic participation, and a defensible business purpose; it is not established by its share percentages alone. For a company that falls outside Sections 97 and 98, the following practical indicators help distinguish a real business with genuine Thai shareholders from a nominee arrangement:
Genuine capital contribution. Thai shareholders contributed actual money for their shares, traceable in bank records. The capital is proportionate to the shareholding (a 51% Thai shareholder contributed 51% of the company’s paid-in capital). No “shareholder loans” from the foreign minority back to the Thai majority disguising the source of funds.
Genuine economic interest. Thai shareholders receive their share of dividends, attend board meetings, sign meaningful corporate decisions, and bear real economic upside and downside. They are not paid a fixed monthly stipend independent of company performance.
Defensible business purpose. The company conducts real activity — a hotel, a restaurant, a tour operation, a property management business, a Board of Investment (BOI)-promoted manufacturing operation. Holding a single residential villa for personal use is not a business purpose and may carry particularly high legal risk.
These are practical indicators, not a statutory checklist or a guarantee. Registrars, investigators, and courts assess the full facts of each company.
When might a Thai company be the right structure for property?
A Thai company might be the right structure when genuine Thai partners and a real business need the land, rather than when it is intended to give a foreign buyer control of a personal residence. Three commercial situations in which independent counsel may assess a company structure:
Genuine commercial real estate. A foreign investor partnering with Thai partners to develop a hotel, retail center, or rental compound where the Thai partners are real participants in the venture. The company holds the land for the business; the business pays a return that funds the Thai shareholders’ participation.
BOI-promoted activities. Section 27 of the Investment Promotion Act does not create an automatic or general land right. A promoted company may own only land that the BOI specifically approves as necessary for its approved promoted activity, subject to project-specific conditions. Offices, staff housing, and other ancillary uses have separate limits. If promotion ends or the land is used outside the approval, disposal may be required.
Joint venture with mixed ownership. A foreign investor and a Thai partner who genuinely co-own a property business. The Thai partner is not a nominee — they have skin in the game, brought capital, and participate in decisions.
For personal residences, a Thai-company structure might not be the right fit; independent counsel must assess the statutory tests and the full facts.
Does a foreign parent company change which Land Code test applies?
No. A foreign parent above a Thai company changes who controls the group, not which Land Code test the Thai subsidiary must pass. Section 98 treats a Thai company as foreign when a company described in Section 97 holds shares or invests in it in the manner Section 97 specifies, so an offshore holding layer does not switch off Sections 97 and 98. The condominium, BOI, and IEAT routes open to a foreign parent buying directly, rather than through a Thai subsidiary, are covered in A Hong Kong company cannot own Thai land for a home. It can hold a foreign-quota condo.
Should I compare simpler property rights before using a Thai company?
For a personal residence, a Thai-company structure might not be the right fit before a buyer has assessed the simpler registered rights that match the intended use.
| Buyer objective | Route to examine first | What it does not do |
|---|---|---|
| Own an eligible condominium unit personally | Foreign-quota freehold, subject to quota, title and foreign-funds requirements | It does not confer ownership of land or excuse condominium due diligence. |
| Use a villa on land for a defined term | A registered [[leasehold-30-year-renewable | lease]], with renewal promises assessed separately |
| Own the villa building separately from the land | A registered [[usufruct-superficies-habitation | superficies]], commonly assessed alongside a lease |
| Operate a genuine business that needs the land | A real Thai company or a specifically approved [[boi-scheme-thai-property | BOI]] route, if the facts and permissions support it |
For the transaction checklist, see Buying a villa in Thailand as a foreigner in 2026: land, house and rights.
