Tourism firms suspected of using nominees
SEVEN companies involved in tourism in Chiang Mai and four restaurants on Koh Chang, Trat, are suspected of breaching the Foreign Business Act (FBA) by having Thai nominees hold majority stakes, the Commerce Ministry says.
Those companies will soon face in-depth investigation by the ministry’s Business Development Department, the Department of Special Investigation (DSI), and the Revenue Department.
Pongpun Gearaviriyapun, director-general of the department, said the seven companies in Chiang Mai were in tourism-related businesses, including souvenir, leather-goods, rubber-mattress, jewellery and resort enterprises. Such businesses are reserved for Thai ownership by the FBA and foreigners are not allowed to hold majority shares.
Pongpun said that in cooperation with the DSI and the Tourism and Sports Ministry, her agency had gradually investigated suspect firms in many provinces, and the probe recently focused on seven in Chiang Mai, one of which was highly likely to have breached the FBA.
As part of the investigation, the Business Development Department will ask the suspect companies’ shareholders to speak to the agency’s legal officers. The department will also question the companies’ directors and examine their documentation. If any have committed offences, their cases will be forwarded for prosecution.
If found to be breaching the FBA, foreigners and Thai nominees can be subject to fines of Bt100,000 to Bt1 million and/or three years in prison.
In cooperation with the Tourism Department and the DSI, the Business Development Department will this year closely scrutinise the travel industry and other businesses listed in Annex III of the FBA. That annex protects certain businesses in which Thais are deemed not ready to compete directly with foreigners.
Pongpun said that although it is stringently examining companies’ share structures, the department has relaxed some regulations, unlocking some businesses such as banking and insurance from Annex III.
She said most companies conducted their business in accordance with the law.
To create better understanding about the FBA, the department has sent legal teams to educate enterprises on how to do business transparently.
