You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

June 16, 2017

Thailand: Amendments to the Direct Sales and Direct Marketing Act

Subscribe to Updates

The Thai government has passed legislation that imposes more stringent rules and regulations to protect consumers from business operators engaging in direct sales and direct marketing. The amendments to the Direct Sales and Direct Marketing Act (No. 3), B.E. 2560 (2017) were published in the Government Gazette on May 17, 2017. When they enter into force 120 days after the publication date, the amendments will not only change the definition of “Direct Marketing,” but will also significantly alter the direct sales and direct marketing practices and provisions prescribed in the previous legislation. The key amendments to the Act are outlined below.

New Requirements for Direct Sales Registration

  1. A business applying for direct sales registration must be a partnership with a minimum registered capital of THB 500,000; or a limited company or a public limited company with minimum registered and paid-up capital of THB 1,000,000.
  2. Direct sale operators must be jointly liable to consumers who purchase goods or services from their independent distributors.

New Requirements for Direct Sales and Direct Marketing Registration

  1. Applicants are required to provide a guarantee to the registrar in the amount prescribed by the Ministerial Regulation.
  2. Applicants must not have had their direct sales and direct marketing registration revoked within a period of five years prior to the application submission date.
  3. Operators must notify the registrar of any office relocation within 15 days from the relocation date.
  4. Operators must prepare a sale and purchase document for goods or services in Thai which is easy to read and understand. The document must contain at least: (1) the name of the buyer and the seller; (2) the sale and purchase date; (3) the delivery date; and (4) the rights of the consumer to terminate the contract, whereby such termination right must be specifically stated so that it is visibly clearer than the other general information.
  5. Managing partners, managing directors, directors, or any persons who are responsible for the operation of the direct sales business must not have prohibited qualifications as stipulated under the Act, such as: (1) being declared bankrupt; (2) being adjudged to be incompetent or quasi-incompetent; or (3) being imprisoned by a final judgement, except imprisonment for negligence or misdemeanors.
  6. Any transfer or cessation of business operations must be approved by the registrar.

Violations of these provisions may result in imprisonment, fines, and/or a revocation of the registration. Furthermore, directors, managers, or any persons responsible for the business of the violating company may also be liable for punishment for stated offenses.

The amendments provide a transition period for operators who have already been registered for direct sales and direct marketing activities. These operators must comply with all requirements within the prescribed time frame stipulated under the new amendments—otherwise, their registrations may be revoked.

Related Professionals

Practices

Corporate/M&A

Location

RELATED INSIGHTS​ 

August 20, 2026
Vietnam’s Law on Bankruptcy and Rehabilitation No. 142/2025/QH15, passed by the National Assembly on December 11, 2025, does something many regional counterparts do not yet attempt: it instructs parties and arbitral tribunals on exactly what happens to an arbitration once a debtor becomes insolvent. Together with the Law on Commercial Arbitration No. 54/2010/QH12, the new law improves upon what used to be an uncertain area of practice, now providing an explicit, mandatory sequence of procedures. Suspension and Termination of Arbitration Proceedings Under article 40(2) of the law, once a Vietnamese court accepts a bankruptcy petition, any arbitration that concerns the debtor’s financial obligations must be temporarily suspended as soon as the tribunal receives the court’s notification. If the court subsequently issues a decision commencing bankruptcy proceedings, article 59(2) takes a further step: the suspended arbitration is terminated outright, and the underlying case file is transferred to the court handling the insolvency for resolution. The two provisions work as a sequence: first suspension, then termination and transfer, rather than as independent triggers. Meanwhile, article 60(4) reinforces this effect by vesting the bankruptcy court with exclusive jurisdiction over all claims against the debtor from the date the petition is accepted. Notably, this mechanism operates automatically, without the need for the insolvency court to issue a separate anti-arbitration order. The tribunal simply suspends or terminates the proceeding by operation of law once notified; however, Vietnamese law currently provides no procedure by which a party can apply to the insolvency court for permission to continue the arbitration despite the statutory effect. Practitioners with a Vietnamese counterparty in arbitration should treat notification of a bankruptcy filing as something to flag to the tribunal immediately since continuing to arbitrate a claim that has become subject to article 40(2) or 59(2) risks producing an award vulnerable
Read More
August 20, 2026
Thai law contains no provision that speaks directly to what happens to an arbitration when one of the parties becomes insolvent. The interaction between arbitration and insolvency is derived instead from the general operation of two separately drafted laws: the Bankruptcy Act B.E. 2483 (1940) and the Arbitration Act B.E. 2545 (2002). Because Thai courts have had few opportunities to interpret how these two statutes apply together, the practical answer to many questions, such as who represents an insolvent party in arbitration, whether an award will be enforced, and what happens to a foreign proceeding, depends on inference from general principles of insolvency, arbitration, and procedural law rather than on settled rules. Liquidation and Restructuring The Bankruptcy Act governs both liquidation, which winds up a debtor’s affairs, and restructuring (rehabilitation), which aims to preserve a business. The consequences for arbitration differ accordingly. In liquidation, the debtor’s assets vest in the official receiver, who alone can conduct or continue any arbitration affecting the estate; the debtor loses the authority to act on its own behalf. In restructuring, the plan preparer or administrator takes over that role, but there is more room for the debtor to remain involved, since the objective of rehabilitation is to keep the business operational. Restructuring carries an automatic stay that takes effect once the Bankruptcy Court accepts the restructuring petition. This stay can halt an arbitration regardless of where it is seated. In contrast, liquidation does not work through a stay; instead, the debtor’s loss of authority over its own assets and disputes is what constrains the arbitration. Neither proceeding provides a party a formal route to apply for permission to continue arbitrating—the Bankruptcy Act contains no such mechanism—though in restructuring cases the Bankruptcy Court may allow proceedings to continue where doing so will not prejudice
Read More
August 20, 2026
As part of its membership in Lex Mundi, Tilleke & Gibbins has released the latest edition of its Guide to Doing Business in Thailand, providing an overview of the legal, regulatory, and commercial considerations for companies establishing or expanding operations in Thailand. The 2026 edition offers practical insight into the country’s business environment, investment framework, and operational requirements. The guide covers a wide range of topics relevant to foreign and domestic investors, including: Investment incentives and promotion schemes Financial facilities and banking regulations Exchange controls and money transfers Import and export regulations Business structures and incorporation options Requirements for establishing a business Operational and compliance considerations Business cessation and insolvency procedures Employment and labor laws Taxation Immigration and visa requirements Prepared by Tilleke & Gibbins lawyers across multiple practice areas, the publication outlines key aspects of doing business in Thailand, including foreign investment restrictions, regulatory compliance obligations, corporate structures, employment requirements, and recent legal and economic developments affecting investors. The publication forms part of Lex Mundi’s Country Guides series, a global collection of jurisdiction-specific reference materials prepared by member firms around the world. Together, these guides help companies evaluate opportunities, compare regulatory environments, and plan international business activities across multiple markets. The full Guide to Doing Business in Thailand 2026 is available through the button below.
Read More
August 18, 2026
The Bank of Thailand (BOT) is seeking public comment on proposed amendments that would significantly expand know-your-customer (KYC) and customer due diligence (CDD) requirements for cash-related transactions at financial institutions (FIs) and specialized financial institutions (SFIs). Released on August 5, 2026, the proposed regulation would supersede BOT Notification No. 16/2569, which focused primarily on cash withdrawal transactions. The public comment period is open through September 3, 2026. The amendments reflect concerns that FIs and SFIs may be used to facilitate the movement, concealment, and conversion of criminal proceeds, potentially damaging institutional operations and public confidence in the financial system. Expanded Scope of Covered Transactions The most significant change is the broadening of the definition of “cash-related transactions.” Previously, the regulation covered only cash withdrawals and uncrossed check withdrawals. The amended regulation extends coverage to include: Cash deposits, check deposits, or receipt of funds from the public not in the form of deposit accounts; Thai baht (THB) banknote exchange (different denominations); Receipt of cash for issuing checks and drafts; and Purchase, sale, or exchange of foreign banknotes. Mandatory Identity Verification and Risk Management For all cash-related transactions, FIs and SFIs must require customers, or authorized or delegated persons, to present identification or verify their identity before every transaction, including one-time (walk-in) transactions. Specific identification requirements vary by transaction type, customer nationality, and channel (branch vs. electronic). FIs and SFIs must also establish comprehensive risk management processes and procedures for cash-related transactions. These requirements include identifying customers or authorized representatives in accordance with transaction-specific verification standards, analyzing customer behavior, implementing risk-management measures proportionate to the customer’s risk profile, and recording abnormal behavior in relevant systems. The BOT also encourages institutions to proactively guide customers toward transaction channels that offer greater traceability than cash. For corporate customers in high-risk business sectors—including foreign
Read More