Foreigners can buy a business in Thailand, but the deal needs careful structuring. The Foreign Business Act restricts foreign ownership across around 50 business categories, so the first step is confirming whether your activity is permitted, or whether you need a Foreign Business Licence, BOI promotion, or the US-Thai Treaty of Amity. Buyers choose between a share purchase (acquiring the company and its existing liabilities) or an asset purchase (taking only selected assets). Thorough due diligence on tax, employment, and lease history is what protects the buyer. Most SME deals take three to six months and cost four to eight percent of the deal value.
Introduction :
Buying a business in Thailand is often faster than building a company from scratch, but the process is considerably more complex than many foreign investors initially expect. While an existing business may already have staff, licences, operations, and an established revenue stream in place, a Thailand business acquisition may become problematic if the legal structure and liabilities are not properly reviewed before signing.
Two of the most common issues are restrictions under the Foreign Business Act (FBA), which limits foreign ownership in many sectors and undisclosed tax, accounting, labour, or social security liabilities inherited from the target company. For this reason, proper due diligence is one of the most important parts of buying a business in Thailand.
This guide explains the recommended requirements and processes for buying a business in Thailand, including deal structuring, due diligence Thailand procedures, transaction documents, completion processes, and what to expect after completing the transaction.
A proper Thailand business acquisition does not only involve a simple share purchase agreement. In practice, most transactions involve tax, employment, and immigration compliance, particularly where foreign directors, Board of Investment (BOI) privileges, or foreign staff are involved.
At Lex Nova Partners, our team regularly supports foreign investors through the full acquisition process, including legal due diligence, transaction structuring, BOI and FBA considerations, employment matters, and post-acquisition compliance in Thailand.
Points clés
- Buying an existing business in Thailand is often faster than starting from scratch because it provides immediate access to staff, licences, revenue, and supplier relationships, but it also means inheriting the company’s historical liabilities such as unpaid taxes, employment disputes, and compliance issues.
- The Foreign Business Act (FBA) restricts foreign ownership in around 50 categories of business across three lists, meaning foreigners often need a Foreign Business Licence, BOI promotion, or the US-Thai Treaty of Amity to legally own and operate in many sectors.
- Deals can be structured as a share purchase (buying the entire company and its liabilities) or an asset purchase (buying only selected assets to avoid inherited liabilities), and the right choice depends on the target’s compliance history, tax exposure, and operational needs.
- Thorough due diligence covering corporate, financial, legal, employment, and lease matters is essential, and the purchase agreement should include seller guarantees, indemnity provisions, and protections like in-out clauses that tie part of the payment to post-sale performance.
- Common costly mistakes include trusting seller documents without verification, ignoring employee severance liabilities, using illegal nominee shareholder structures, overlooking change-of-control clauses in contracts, and treating immigration and work permit planning as an afterthought.
Why Foreign Investors Are Buying Thai Businesses Instead of Starting From Scratch
For many foreign investors, buying a business in Thailand is faster and more practical than creating a new company from the start. One of the biggest advantages of purchasing an existing business is that an existing business may already hold the licences, registrations, operational approvals, and supplier relationships needed to operate. This can significantly reduce the time, administrative work, and operational setup typically involved when establishing a new company from scratch.
Another important advantage is that an existing business may already be structured to support a visa and work permit for a foreign employee immediately. For example, the company may already meet the required registered capital thresholds and Thai employee ratio requirements needed for work permit sponsorship.
A Thailand business acquisition can also provide immediate access to staff, revenue, customers, lease agreements, and an established market presence. This is particularly important in sectors where operational continuity and brand reputation matter, such as hospitality, hotels, restaurants, F&B, export manufacturing, e-commerce, software, and professional services.
In many cases, buying a business in Thailand allows the investor to begin operating almost immediately rather than spending months dealing with incorporation, licensing, recruitment, and setup delays.
However, acquisitions also come with significant risks. When acquiring an existing company, the buyer does not only acquire the business itself. They may also inherit historical tax exposure, employment disputes, accounting irregularities, compliance failures, hidden debt, and operational liabilities that were not immediately visible during the initial stages of negotiations. This is one of the main reasons why conducting proper due diligence procedures in Thailand is critical before any transaction moves forward.
Can a Foreigner Buy a Business in Thailand? The Foreign Business Act Reality
Thailand allows foreign ownership of businesses and also permits buying a business in Thailand as a foreigner. However, not all business activities can be undertaken by a foreign owned business.
The Foreign Business Act, (Foreign Business Act B.E. 2542 (1999)), is the primary legislation governing foreign business ownership in Thailand. The Foreign Business Act Thailand was introduced to protect certain sectors for Thai nationals while continuing to welcome foreign investment into areas that support economic development.
The Foreign Business Act is used to determine whether a business activities are restricted to a foreign business, whether a licence may be granted, and whether a company structure complies with Thai law.
Qui est considéré comme un « étranger » au sens de la loi sur les entreprises étrangères ?
L’article 4 de la loi thaïlandaise sur les entreprises étrangères (Foreign Business Act) adopte une définition large de la notion d’« étranger ». Celle-ci ne se limite pas à la nationalité et s’applique à la fois aux personnes physiques et aux personnes morales. Sont notamment considérés comme des étrangers :
- Toute personne physique ne possédant pas la nationalité thaïlandaise ;
- Toute personne morale non enregistrée en Thaïlande ;
- Toute personne morale enregistrée en Thaïlande dont au moins 50 % du capital est détenu par des personnes physiques non thaïlandaises ou des entités étrangères, ou dont les investissements étrangers représentent au moins la moitié du capital total ;
- Toute personne morale enregistrée en Thaïlande dont au moins 50 % des parts sont détenues, directement ou indirectement, par des entités ou personnes répondant aux critères ci-dessus ;
- Toute société en commandite ou société en nom collectif enregistrée dont l’associé gérant est un ressortissant étranger.
Les trois listes d’activités soumises à restriction
La loi thaïlandaise sur les entreprises étrangères encadre près de 50 catégories d’activités, réparties en trois listes distinctes selon leur niveau de sensibilité et les conditions d’accès pour les investisseurs étrangers.
Liste 1 – Activités strictement interdites
La liste 1 regroupe les activités considérées comme essentielles à l’intérêt national, telles que l’édition de journaux, certaines activités agricoles, l’élevage ou encore le commerce foncier. Ces activités sont strictement interdites aux investisseurs étrangers, sans possibilité d’autorisation ou de dérogation.
Liste 2 – Activités liées à la sécurité nationale et aux infrastructures
La liste 2 comprend les activités liées à la sécurité nationale, aux transports terrestres, maritimes et aériens, ainsi que certains secteurs relevant des arts, de la culture et des ressources naturelles. La participation étrangère peut être autorisée à titre exceptionnel, sous réserve d’une approbation du ministre du Commerce et du Conseil des ministres. En pratique, ces autorisations restent rares et font l’objet d’un examen particulièrement strict.
Liste 3 – Secteurs de services à accès restreint pour les investisseurs étrangers
List 3 is the most commercially relevant category for foreign investors. It includes “other categories of service businesses” not otherwise exempted by ministerial regulations. Foreign companies may apply for a Foreign Business Licence, subject to approval by the Director-General of the DBD and the Foreign Business Committee. A Foreign Business Licence also requires a minimum capital of at least THB 3 million per restricted business activity. Many professional services, consulting, and trading structures fall within this list. For the lawful routes to majority or full foreign ownership, see our guide on 100% foreign business ownership in Thailand.
Quelles activités permettent une participation étrangère à 100 % sans autorisation spéciale ?
Les activités commerciales suivantes ne sont pas restreintes par la Loi sur les entreprises étrangères en Thaïlande et peuvent être exercées par des entreprises détenues à 100 % par des intérêts étrangers :
Sociétés d’exportation
La Thaïlande encourage activement les exportations. Les entreprises qui exportent uniquement des produits en dehors du pays peuvent être entièrement détenues par des étrangers. Pour maintenir ce statut, ces entreprises doivent veiller à ce que leurs opérations et revenus soient exclusivement internationaux, sans vente directe sur le marché intérieur thaïlandais.
Entreprises manufacturières
Les entreprises manufacturières en Thaïlande peuvent être détenues à 100 % par des étrangers, car la fabrication n'est pas incluse dans la liste « restreinte » de la Loi sur les entreprises étrangères (FBA). Cela permet aux investisseurs étrangers de posséder et d'exploiter des entreprises manufacturières sans nécessiter de partenaire thaïlandais.
Another advantage for manufacturing companies is their eligibility for a BOI promotion. BOI promotions offer many advantages including different types of tax exemptions including Corporate Income Tax exemptions and Tax exemptions on the import of machinery. BOI promotions can also allow full foreign ownership and the ability to own land which can be used for their factory etc. For current incentives, see our update on the latest BOI incentives for foreign investors.
Dans certains cas, une activité manufacturière peut rester soumise aux restrictions prévues par la loi sur les entreprises étrangères (FBA), notamment lorsqu’elle concerne des secteurs sensibles tels que l’agriculture, l’exploitation minière ou certaines activités de transformation alimentaire.
Idées reçues courantes sur la participation étrangère
There is a common misunderstanding that incorporating a Thai company automatically allows majority foreign ownership. However, if the business activity falls within a restricted list, foreign majority ownership may require the foreign investor to apply for a Foreign Business licence or an alternative option such as a Board of Investment (BOI) promotion or the Treaty of Amity (for American companies). The Treaty of Amity grants US investors national treatment but still excludes several reserved sectors, including land ownership, communications, transport, banking involving depository functions, fiduciary functions, and the exploitation of land and natural resources. In practice, most of the business activities that foreign investors wish to undertake are likely to be restricted by the foreign business act.
Lorsque ni la licence d’entreprise étrangère ni la promotion du BOI ne peuvent être obtenues, l’investisseur étranger souhaitant exercer une activité restreinte devra s’associer avec un partenaire thaïlandais.
Une autre idée reçue consiste à considérer les montages avec actionnaires prête-noms comme une solution simple pour contourner la réglementation. Or, ces pratiques sont illégales et font l’objet d’un contrôle renforcé. Le Département de développement des entreprises (DBD) a intensifié ses vérifications, notamment en 2024 et 2025, en examinant la légitimité des actionnaires, l’origine des fonds et les structures de droits de vote afin de détecter toute dissimulation de contrôle étranger.
Since 1 April 2026, DBD Order No. 1/2569 also requires a Confirmation of Investment letter in certain cases involving foreign shareholders or foreign authorised directors, certifying that all shareholders have genuinely invested and that no nominee arrangement exists. For more on how Thai authorities are policing these structures, see our note on Thailand’s tightening rules on nominee shareholders.
Tendances en matière d’application de la loi et sanctions
Les autorités thaïlandaises renforcent désormais leurs contrôles afin de vérifier si les actionnaires thaïlandais agissent en tant qu’investisseurs réels ou s’ils détiennent des actions pour le compte d’investisseurs étrangers dans le but de contourner la loi sur les entreprises étrangères.
Non-compliance with the Foreign Business Act in Thailand can result in significant consequences, including fines, imprisonment, suspension of operations, and in severe cases, business closure. Under Section 36 of the Foreign Business Act, a breach can carry imprisonment of up to three years and/or a fine of THB 100,000 to THB 1,000,000, alongside additional criminal liability under the Penal Code for false statements. Directors may also face personal liability if they knowingly participate in unlawful structures.
Pour sécuriser votre projet, il est essentiel d’adopter une structuration juridique adaptée. Notre équipe peut vous accompagner dans l’évaluation de votre modèle d’affaires, l’analyse des restrictions applicables et l’identification de la solution la plus appropriée pour une implantation conforme et durable en Thaïlande.
Share Purchase vs Asset Purchase: How to Structure the Deal
When buying a business in Thailand, one of the most important decisions is whether the transaction should be structured as a share purchase or an asset purchase. The structure of the transaction affects tax exposure, liabilities, employment obligations, licences, contracts, and the overall level of risk assumed by the buyer.
In practice, the most appropriate structure depends on the nature of the business, the industry involved, the company’s compliance history, and whether the buyer wishes to acquire the existing legal entity itself or only selected business assets. Certain regulated sectors may also require additional approvals or restructuring considerations under the Foreign Business Act, for example if the company is Thai owned and engaged in a restricted activity to a foreign company.
The sections below explain the differences between a share purchase and an asset purchase in Thailand, including the advantages, disadvantages, and practical considerations foreign investors should understand before proceeding with a transaction.
Achat des seuls actifs d’une société
When considering buying a business in Thailand, investors may choose to purchase only selected assets of a company rather than acquiring the entire legal entity. In practice, an asset purchase allows the buyer to take control of specific business assets, such as equipment, inventory, intellectual property, customer databases, or lease rights, without assuming ownership of the company itself.
This structure is often used where the target company has historical liabilities, unresolved compliance issues, or operational risks that the buyer does not wish to inherit. Unlike a transaction structured through a share purchase agreement Thailand transaction, the buyer can selectively acquire assets while leaving behind unwanted liabilities and obligations.
Avantages de l’achat des actifs d’une société
One of the main advantages of an asset purchase is the ability to avoid inheriting the seller’s liabilities. Because the buyer is not acquiring the legal entity itself, obligations such as unpaid taxes, employment disputes, outstanding loans, litigation, or previous regulatory breaches generally remain with the seller. This can significantly reduce legal and financial exposure following completion of the transaction.
An asset purchase also gives buyers greater flexibility. Investors can select only the assets relevant to their commercial objectives while excluding underperforming assets or unnecessary liabilities. In certain situations, this may be considered lower risk than proceeding under a full share purchase agreement Thailand structure.
Inconvénients de l’achat des actifs d’une entreprise
Despite these advantages, asset purchases also create practical and operational challenges. Purchasing assets alone does not automatically transfer the seller’s goodwill, brand reputation, customer relationships, supplier contracts, or workforce. Existing employees usually need to be rehired under new employment arrangements, while commercial contracts often need to be renegotiated from the beginning.
Asset purchases may also result in higher transaction costs. Different asset classes can attract different taxes, transfer fees, and registration requirements in Thailand. In addition, certain licences and regulatory approvals may not be transferable, requiring the buyer to apply for entirely new operational licences before the business can continue operating.
Purchasing the Whole Business
For many foreign investors, buying a business in Thailand can provide a faster and more practical route into the market than starting a company from scratch. An existing business may already have staff, licences, operational systems, suppliers, customers, and revenue in place, allowing the buyer to begin operating more quickly after completion.
Faster Route to Revenue and Operations
One of the main advantages of acquiring an existing business is the ability to continue operations without major interruption. Rather than spending months building a customer base, developing operational systems, and establishing supplier relationships, the buyer acquires a business that is already generating revenue and operating within the market.
This can reduce the time required to achieve profitability and allow the investor to focus on growth and expansion rather than initial setup.
Existing Infrastructure and Operational Systems
An established business may already have offices, production facilities, IT systems, machinery, inventory, and operational processes in place. This reduces the need for major upfront investment and allows the buyer to continue operations immediately after completion.
In addition, existing businesses often already have established supplier relationships, service providers, logistics arrangements, and internal workflows that have been tested over time. This can reduce operational risk compared to launching an entirely new business model.
Trained Workforce and Management Continuity
Acquiring an existing business also allows the buyer to inherit an experienced workforce that already understands the company’s operations, systems, customers, and internal procedures. This can reduce recruitment and training costs while helping maintain operational continuity after the acquisition closes.
For service-based businesses in particular, retaining experienced staff can be critical to preserving customer relationships and maintaining revenue stability.
Existing Market Presence and Brand Recognition
An established business may already benefit from brand recognition, customer loyalty, supplier confidence, and market credibility built over many years of operation. Rather than entering the market as an unknown company, the buyer acquires an existing reputation and operating history within the industry.
The company’s historical operations may also provide valuable insights into customer behaviour, pricing, competitors, and future growth opportunities within the Thai market.
Existing Licences and Regulatory Approvals
In many cases, an established business may already hold the operational licences, registrations, and approvals required to legally conduct its activities in Thailand. Depending on the industry involved, obtaining these approvals independently can sometimes take significant time and administrative work.
This can be particularly valuable in regulated sectors where licensing and operational approvals form a major part of the company’s commercial value.
Existing Capital and Work Permit Structures
Another practical advantage is that the company may already satisfy requirements for supporting foreign employees and directors. For example, the business may already meet registered capital requirements and Thai employee ratio requirements necessary for work permit sponsorship.
This can simplify the process of obtaining visas and work permits for foreign owners or management after completion of the transaction.
Thailand’s Investment Environment
Thailand continues to attract foreign investors due to its strategic location, developed infrastructure, manufacturing base, and regional access to ASEAN markets. Government incentives through the Thailand Board of Investment (BOI) may also provide additional advantages for qualifying businesses, including foreign ownership exemptions, tax incentives, and work permit support for foreign staff.
For many investors, acquiring an existing business in Thailand provides a faster route into the market while reducing many of the operational challenges associated with starting a company entirely from scratch.
The Step-by-Step Acquisition Process in Thailand
Lorsqu’ils envisagent d’acheter une entreprise en Thaïlande, les investisseurs doivent suivre plusieurs étapes essentielles.
1. Effectuer une vérification préalable approfondie
L'audit préalable est cruciale pour réussir l’acquisition d’une entreprise existante. Elle permet d’évaluer la santé financière, la conformité juridique et les performances de l’entreprise cible, tout en identifiant les passifs ou risques potentiels.
Cette étape protège votre investissement en vous offrant une compréhension complète de la valeur de l’entreprise et des risques associés.
Principaux domaines d’intérêt :
- Corporate Documentation:
- Company Registration: Verify that the business is properly registered with the Department of Business Development (DBD) et qu’elle respecte la législation thaïlandaise, y compris la la loi sur les entreprises étrangères.
- Shareholder and Director Details: Review the company’s Articles of Association, shareholder agreements, and board resolutions to ensure everything matches with the proposed sale.
- Financial Health:
- Financial Statements: Examine audited financial reports, tax returns, and bank statements to assess revenue trends, profitability, and solvency.
- Outstanding Liabilities: Check for any unpaid debts, tax arrears, or pending legal disputes that could impact future operations.
- Contracts and Agreements:
- Lease Agreements: Ensure that property leases are registered with the Land Department if exceeding three years, and review renewal clauses and termination rights.
- Supplier and Customer Contracts: Review and agreements to understand the business’s ongoing obligations and relationships.
- Operational Factors:
- Employee Records: Review employment contracts, benefits, and severance policies to ensure compliance with Thai labor laws.
- Assets: Verify ownership and valuation of assets, including real estate, machinery, intellectual property, and inventory.
- Legal and Regulatory Compliance:
- Identifiez tout litige juridique en cours ou passé, toute dette fiscale ou problème de conformité avec les permis et licences.
- Vérifiez que l’entreprise dispose de toutes les autorisations nécessaires pour exercer légalement son activité dans son secteur.
2. Rédaction et négociation du contrat d’achat
Drafting a proper purchase agreement is required to protect your interests and ensure a smooth transaction. Depending on the acquisition structure, you’ll need either a Share Purchase Agreement (SPA) or an Asset Purchase Agreement (APA). A properly drafted purchase agreement reduces the risk of disputes and provides a clear framework for the transaction, protecting both parties’ interests
Éléments clés du contrat :
- Description of the Transaction: Clearly define whether the sale includes the company’s shares, assets, or both. Specify any exclusions.
- Financial Terms:
- Prix d’achat et calendrier de paiement.
- Clauses d’indexation sur les bénéfices futurs ou paiements basés sur les performances, le cas échéant.
- Representations and Warranties: Assurances from the seller about the business’s condition, compliance, and not having any hidden liabilities.
- Indemnity Provisions: Protect the buyer against claims or liabilities arising from pre-sale activities.
- Closing Conditions: Outline requirements to finalize the transaction, such as regulatory approvals, tax clearance, or debt settlements.
- Post-Sale Obligations: Include non-compete clauses, transitional support from the seller, or employee retention agreements.
Protections pour l’acheteur dans un contrat d’achat d’actions
Pour protéger l’acheteur, il est recommandé d’inclure des garanties du vendeur dans le contrat. Ces garanties couvrent les responsabilités cachées ou les problèmes non divulgués survenant après la vente, le vendeur restant responsable de ces éléments pendant une période définie.
Dans certains cas, l’acheteur peut exiger que l’ancien propriétaire participe à une période de transition. Cela permet un transfert harmonieux des connaissances et assure la continuité des opérations. L’ancien propriétaire peut rester en tant que consultant ou gestionnaire pendant une période déterminée, facilitant ainsi l’apprentissage des exigences clés de l’entreprise avant que l’acheteur ne prenne entièrement le relais.
Qu'est-ce que la clause d’entrée-sortie en Thaïlande
Une autre protection efficace pour l’acheteur consiste à inclure une clause d’entrée-sortie dans le contrat. Cette clause lie une partie du prix d’achat aux performances réelles de l’entreprise pendant une période définie après la vente. Plutôt que de payer la totalité du prix immédiatement, un montant convenu est retenu et n’est versé que si l’entreprise atteint les objectifs de chiffre d’affaires et de revenus préalablement définis.
This clause offers strong protection against sellers fraudulently inflating the company’s financials or misleading buyers about the company’s performance. If the revenue does not meet the buyer’s expectations, the withheld amount can be adjusted or forfeited, reducing the buyer’s risk.
3. Finalisation du transfert de propriété
Une fois le contrat d’achat signé, le transfert légal de propriété doit être effectué. Ce processus comprend plusieurs étapes :
Transfert d’actions
- Execute a share transfer instrument with signatures from the transferor and transferee, witnessed by at least one witness, as required under Section 1129 of the Civil and Commercial Code (failing which the transfer is void).
- Record the transfer in the company’s register of shareholders and issue an updated share certificate to the buyer, which serves as proof of ownership of the shares. Until the transfer is entered in the register of shareholders, it is not enforceable against the company or third parties. The filing of the updated List of Shareholders (Bor.Or.Jor. 5) with the Department of Business Development is declaratory only.
- Paiement des droits de timbre applicables en fonction de la valeur du transfert d’actions.
Changements au sein du conseil d’administration
- Convocation d’une réunion du conseil d’administration pour nommer les nouveaux administrateurs et définir leurs pouvoirs.
- Mise à jour de l’affidavit de la société auprès du Département du développement des entreprises (DBD) afin de refléter la nouvelle structure de gestion.
Transferts d’actifs
- En cas d’achat d’actifs, enregistrer le transfert de propriété des biens tels que les biens immobiliers, les véhicules et la propriété intellectuelle auprès des autorités compétentes.
- S’assurer que toutes les taxes et frais liés aux actifs sont réglés lors du processus de transfert.
4. Restructuration post-acquisition
Après l’acquisition d’une entreprise, une restructuration peut être nécessaire pour s’assurer que la société répond à vos objectifs et besoins stratégiques.
Key Areas for Restructuring include:
Gouvernance d’entreprise
Lors de l’acquisition, il est essentiel de mettre à jour les documents relatifs à la gouvernance afin de refléter la nouvelle structure de propriété et de garantir la conformité avec le droit des sociétés thaïlandais. Cela inclut la révision et la modification des documents juridiques clés, tels que les statuts et les conventions d’actionnaires, afin de les aligner sur vos objectifs commerciaux et de protéger les intérêts des parties prenantes.
Refonte de l’image de marque
La refonte ou le repositionnement de l’image de marque peut permettre d’aligner l’entreprise sur votre vision à long terme, notamment si vous ciblez un nouveau segment de marché.
Les options possibles incluent le rafraîchissement de l’identité de la marque, l’adaptation du modèle commercial ou l’ajustement du message de l’entreprise.
Toute modification de l’image de marque doit être menée avec prudence afin de ne pas perturber les clients existants ou nuire à la réputation établie de l’entreprise.
Fidélisation et recrutement des employés
Lors de l’acquisition d’une entreprise, le maintien d’une main-d’œuvre compétente est essentiel pour assurer une transition fluide. La fidélisation des employés clés garantit la continuité des opérations, conserve les connaissances essentielles de l’entreprise et préserve les relations avec les clients et les fournisseurs.
Parallèlement, le recrutement permet de renforcer l’équipe, d’apporter de nouvelles compétences et d’aligner le personnel sur vos objectifs commerciaux à long terme.
Comptabilité
Lors de l’acquisition d’une entreprise en Thaïlande, il est recommandé de choisir votre propre comptable. Bien que conserver le comptable existant puisse sembler pratique, un nouveau comptable vous offre une vision claire et impartiale des finances de l’entreprise et s’assure que la comptabilité et la conformité fiscale sont correctement gérées.
Cette précaution est d’autant plus importante que la Thaïlande a numérisé son système fiscal. Les entreprises ayant auparavant des pratiques comptables insuffisantes pourraient rencontrer des difficultés. Dès le départ, un nouveau comptable vous aide à éviter des problèmes fiscaux imprévus et garantit le fonctionnement légal et efficace de votre entreprise.
Six Costly Mistakes Foreign Buyers Make in Thailand
Many foreign investors assume that buying a business in Thailand follows the same process as acquisitions in their home country. In practice, Thailand business acquisition transactions involve legal, tax, accounting, employment, immigration, and regulatory risks that are commonly underestimated during negotiations.
Below are six of the most common and costly mistakes foreign buyers make when acquiring a business in Thailand.
Mistake 1: Inheriting Hidden Liabilities in a Share Purchase
One of the most significant risks when purchasing a business outright is inheriting the company’s existing liabilities. In a share acquisition, the buyer acquires the legal entity itself, including many of its historical obligations, risks, and compliance exposure.
Common liabilities that may transfer to the buyer include:
Unpaid Taxes
Outstanding corporate income tax, VAT, withholding tax, or social security liabilities may remain attached to the company after completion. This can result in fines, penalties, surcharges, or Revenue Department investigations against the business under the new ownership.
Undisclosed Lawsuits
The target company may already be involved in ongoing or potential legal disputes that were not disclosed during negotiations. These may include commercial disputes, employment claims, or regulatory investigations that could result in financial losses or reputational damage.
Contractual Obligations
Existing supplier agreements, customer contracts, financing arrangements, leases, or distribution agreements may continue after the acquisition closes. Some of these agreements may contain unfavourable pricing terms, exclusivity obligations, penalties, or financial commitments that the buyer cannot easily renegotiate or terminate.
Liability for Past Misconduct
Even where the buyer had no involvement in the company’s previous operations, they may still inherit exposure arising from the seller’s prior conduct. This may include breaches of contract, regulatory non-compliance, fraudulent activity, misrepresentation, labour law violations, or accounting irregularities committed before the transaction took place.
For this reason, conducting proper legal, financial, tax, and operational due diligence is one of the most important parts of buying a business in Thailand. Where a target is financially distressed, see our guide on business rehabilitation in Thailand.
Mistake 2: Failing to Properly Review Lease Rights and Property Arrangements
Many foreign buyers focus heavily on the company itself without considering the importance of the target business’s lease arrangements. In Thailand, lease structures can create major operational risks if they are not carefully reviewed during due diligence.
It is common for commercial leases to be structured as three-year agreements to avoid Land Department registration requirements. However, unregistered leases exceeding three years are generally not enforceable beyond the initial three-year period. If the business depends heavily on its premises, such as restaurants, hotels, factories, retail stores, or hospitality operations, weak lease protection can create serious long-term problems after completion.
Buyers should also carefully review whether the lease is transferable, whether landlord consent is required for a change of ownership, and whether the landlord may renegotiate rent or renewal terms after the acquisition closes. Wherever possible, investors should negotiate stronger lease protections directly with the property owner during the transaction process, including longer registered lease terms where appropriate.
Another area often overlooked is “key money,” which is commonly used in Thailand for commercial property transactions. Key money may take the form of an upfront payment to a landlord or existing tenant in exchange for lease rights, reduced rent, or access to a commercially valuable location. However, these arrangements are not specifically regulated under Thai law and may not always provide the protections foreign buyers expect.
Without proper lease protection in place, the business may face relocation risks, unexpected rental increases, operational disruption, or significant additional costs shortly after the acquisition is completed. For more on structuring premises, see our guide on commercial lease agreements in Thailand.
Mistake 3: Ignoring Employment Liabilities
Employment liabilities can become one of the largest hidden costs in a share acquisition. Under Thai labour law, employee rights and severance obligations remain with the company after the acquisition closes. A business with long-serving employees may carry significant severance liabilities that are not always immediately visible during the early stages of negotiations.
Proper due diligence should include reviewing employment agreements, salary structures, social security compliance, historical disputes, and accrued severance obligations before finalising the purchase price.
Mistake 4: Using Nominee Structures to Circumvent the Foreign Business Act
Some foreign investors are incorrectly advised to use Thai nominee shareholders to bypass foreign ownership restrictions under the Foreign Business Act. This structure is illegal under Thai law and has become a major enforcement focus for Thai authorities. Violations may result in criminal penalties, fines, imprisonment, forced restructuring, or business closure.
Where foreign ownership restrictions apply, the appropriate approach is to use a lawful structure such as a Foreign Business Licence, BOI promotion, or, where applicable, the US-Thai Treaty of Amity.
Mistake 5: Overlooking Change-of-Control Clauses
Many buyers may fail to review whether key commercial contracts contain change-of-control restrictions. In practice, leases, distribution agreements, financing arrangements, supplier contracts, and franchise agreements may allow termination or immediate repayment if company ownership changes. These clauses can seriously affect the value and operational continuity of the business after closing. Proper legal due diligence should identify these risks early so that waivers, approvals, or revised commercial terms can be negotiated before completion.
Mistake 6: Treating Immigration and Work Permits as an Afterthought
Many foreign buyers focus entirely on the acquisition itself without planning how they will legally manage the business after completion. In reality, foreign directors and managers usually require a valid visa and work permit before they can actively operate the company in Thailand. Delays in immigration planning can create serious operational problems immediately after closing.
At Lex Nova Partners, immigration, corporate, tax, and employment planning are handled together as part of the acquisition process. This allows visa and work permit applications to begin during due diligence rather than after completion, helping foreign buyers transition into management of the business without unnecessary delays. For the available options, see our guides on Thai work permits and the LTR visa.
Why a Full-Service Firm Matters for Thai Acquisitions
A Thailand business acquisition is rarely just a simple share purchase agreement. In practice, acquisitions involve multiple legal and operational considerations that must be coordinated carefully from the beginning of the transaction.
The corporate side of the transaction covers proper structuring, due diligence, negotiations, and drafting the share purchase agreement. At the same time, tax considerations such as capital gains tax, VAT exposure, withholding tax, and stamp duty can significantly affect the overall transaction cost if not addressed early. Employment issues must also be reviewed carefully, particularly where severance liabilities, transfer of undertaking risks, or long-serving staff are involved. Immigration planning is equally important, as foreign buyers often require visas and work permits before they can legally manage the business after completion.
One of the most common problems during acquisitions is that different advisors are handling different parts of the transaction separately. A corporate lawyer may identify a risk that affects employment liabilities, while the tax implications may only become visible later in the process. When separate firms handle different parts of the transaction, important issues can easily fall through the cracks.
At Lex Nova Partners, corporate, tax, employment, immigration, and regulatory matters are handled together under one coordinated team. This allows issues identified during due diligence to be reflected immediately across the transaction structure and legal documentation.
Our team regularly supports SME with acquisitions in Thailand, particularly for foreign investors and French-speaking clients entering the Thai market. For buyers considering an acquisition, obtaining legal and tax advice before signing the LOI can often prevent costly restructuring issues later in the transaction.
Frequently Asked Questions
Can a Foreigner Buy a Business in Thailand?
Yes. Foreigners can legally buy a business in Thailand, but foreign ownership restrictions under the Foreign Business Act may apply depending on the business activity involved. In many cases, foreigners can still own more than 49 percent, and frequently up to 100 percent, of the business by using one of the routes below. The four main routes for foreign ownership are obtaining a Foreign Business Licence (FBL), securing BOI promotion, or if the business or investor is American, the US-Thai Treaty of Amity, or operating within sectors that are already exempt from FBA restrictions, such as certain export or manufacturing activities.
How Much Does It Cost to Buy a Business in Thailand?
In addition to the purchase price itself, transaction costs for SME acquisitions in Thailand typically range between 4% and 8% of the deal value. These costs usually include legal fees, financial and tax due diligence, government filing fees, translations, and transaction structuring advice. More complex acquisitions involving BOI structures, cross-border elements, or licensing issues may increase overall costs. At Lex Nova Partners, we can provide fixed-fee scopes for many SME acquisition transactions. See also our overview of Thailand’s SME policy updates.
How Long Does It Take to Buy a Business in Thailand?
A standard SME acquisition in Thailand typically takes between 3 and 6 months from signing the LOI to completion. Transactions involving BOI promotion, Foreign Business Licences, or complex restructuring may take between 6 and 12 months. The process usually includes initial negotiations, due diligence, transaction structuring, drafting the share purchase agreement, regulatory approvals where required, and completion filings with the Department of Business Development.
Is Buying a Business in Thailand a Good Investment?
Buying a business in Thailand can be a strong investment opportunity when the transaction is properly structured and fully reviewed during due diligence. Investors benefit from acquiring an operating business with existing staff, licences, supplier relationships, and customers already in place. However, acquisitions also involve risks, including hidden liabilities, employment exposure, Foreign Business Act restrictions, tax issues, and post-acquisition integration challenges. Careful legal, financial, and operational due diligence is essential before proceeding.
What Is the Difference Between a Share Purchase and Asset Purchase in Thailand?
In a share purchase, the buyer acquires the company itself, including its assets, liabilities, contracts, employees, and historical obligations. In an asset purchase, the buyer acquires only selected business assets while leaving the legal entity and many liabilities with the seller. The most appropriate structure depends on factors such as licensing requirements, employment considerations, tax exposure, operational continuity, and the buyer’s overall risk profile.
Do I Need BOI Approval to Buy a Thai Company?
Not always. BOI approval is generally only required if the target company already holds BOI promotion and the acquisition involves a change of control requiring BOI consent. In other cases, investors may choose to apply for BOI promotion after the acquisition if they need foreign ownership exemptions, tax incentives, or work permit support for foreign staff under Thailand’s investment promotion framework.
Can I Get a Work Permit After Buying a Business in Thailand?
Yes, provided the company satisfies the standard requirements for sponsoring foreign employees. In most cases, this includes at least THB 2 million in registered capital per foreign employee and a ratio of four Thai employees per foreign work permit. BOI-promoted companies may qualify for exemptions from these requirements. Depending on the structure involved, the visa and work permit process usually takes approximately 4 to 8 weeks.
What Taxes Apply When Buying a Business in Thailand?
Several taxes may apply depending on how the acquisition is structured. Share transfers generally attract stamp duty at 0.1% of the transfer value. Thailand does not levy a separate capital gains tax; gains on the sale of shares are taxed as ordinary assessable income. A non-resident individual seller is generally subject to 15 percent withholding tax, subject to relief under any applicable double tax treaty, while a corporate seller is taxed at the standard corporate income tax rate. Asset purchases may also trigger 7% VAT unless the transaction qualifies for a transfer-of-going-concern exemption under Thai tax rules.
Getting Started
Buying a business in Thailand can provide a faster and more practical route into the Thai market than building a company from scratch. However, a successful acquisition requires more than simply negotiating a purchase price. Corporate structuring, tax planning, employment liabilities, regulatory compliance, and immigration planning all need to be managed together from the beginning of the transaction in order to reduce risk and avoid costly issues after completion.
At Lex Nova Partners, our Bangkok-based team handles corporate, tax, employment, immigration, and regulatory matters together under one coordinated workflow. We regularly support SME and foreign investors in Thailand, with bilingual English and French support available throughout the transaction process.
Before signing anything or paying a deposit, it is often advisable to obtain legal and tax structuring advice first. To discuss a proposed acquisition in Thailand, contact our team at +66 (0)6 5527 6323 or [email protected], or visit our office at Ocean Tower 2, 14th Floor, Sukhumvit 19, Bangkok. You can also schedule a 30-minute structuring call through the Lex Nova Partners contact page.
Veuillez noter que cet article est fourni à titre d'information uniquement et ne constitue pas un avis juridique.
