In recent years, Thailand has witnessed significant developments in its personal finance sector, particularly in alternative lending options. This article explores two key concepts in the Thai financial landscape: nano finance and personal loans. These alternative lending models, regulated by the Bank of Thailand (BOT), aim to provide more accessible financial services to individuals and small entrepreneurs who might have limited access to traditional funding sources. Nano Finance: Empowering Small Entrepreneurs The nano finance scheme under the BOT’s supervision is designed to provide funding to small entrepreneurs who might have limited access to traditional financial resources. One of the key features of this scheme is the ability of licensed nano finance providers to use alternative data in assessing loan applicants’ ability to repay (information-based lending). To implement this approach, nano finance providers must have an internal policy on credit approval that supports: Identifying scope and processes for utilizing alternative factors or technologies in determining debt repayment capacity, credit line limits for each loan applicant and total credit limits, and acceptable debt repayment targets; Having resources and personnel with sufficient knowledge, capability, experience, and expertise to operate efficiently and effectively, as well as clear checks and balances; Establishing guidelines for selecting and analyzing factors or financial models to evaluate or predict loan applicants’ ability and willingness to repay; Having an internal sandbox to test key success factors of the selected factors or models; and Having a process for monitoring and reviewing the application of the selected factors or models in assessing debt repayment capability. This approach allows nano finance providers to make more informed lending decisions based on a broader range of data, potentially increasing access to finance for small entrepreneurs who may not have traditional credit histories or collateral. Personal Loans The personal loan scheme under BOT supervision aims to solve loan-shark problems by providing the public with access to

The General Department of Customs and Excise (GDCE) in Cambodia’s Ministry of Economy and Finance launched a trial phase of its Intellectual Property Rights Recordation System (IPRRS) on September 1, 2024. The system compiles necessary information and documents related to intellectual property rights in the country, enabling customs authorities to swiftly access these documents and enhance their ability to identify and intercept potential parallel imports and infringing goods at the border. This will also better facilitate ex-officio actions by customs authorities. The system is currently referred to as being in a “trial phase” to support further amendments or updates to address any potential technical errors that may arise from public use. However, the IPRRS is already fully operational. Types of Recordation Currently, the IPRRS allows two types of recordation: Intellectual property recordation is available for trademarks, geographical indications, copyrights, and related rights that are protected in Cambodia. It allows IP owners, authorized representatives, and legal representatives to record information and documents relating to such rights, including information on possible or potential counterfeit goods, with the GDCE. Recordation will give customs authorities quicker access to the information and enable them to promptly take action against potential counterfeit or infringing goods. Exclusive distributorship recordation is meant to streamline the process that takes place after the Ministry of Commerce issues a notice of the recordation of exclusive rights. Under the current practice, after receiving a copy of a notice of the recordal of an exclusive distributorship issued by the Ministry of Commerce (MOC), the GDCE needs to enter the information into their system manually to enable them to promptly identify or stop potential parallel importation at the border. This reportedly causes delays in border officers’ access to the necessary information. Recordation through the IPRRS, on the other hand, allows local exclusive distributors and their authorized or legal

On September 12, 2024, the Bank of Thailand (BOT) Notification Re: Virtual Bank Supervision Criteria took effect. According to this notification, virtual banks must adhere to standards for traditional commercial banks, along with additional requirements tailored to address virtual banks’ digital nature and corporate structure. Specific Requirements The concepts of supervision remain unchanged from the consultation paper titled “Criteria for Supervising Virtual Banks”. Some of the key additional provisions and details on supervision criteria relate to the following: Financial business groups: The notification identifies virtual banks as financial businesses, subject to the BOT’s regulations on financial business group supervision. If a virtual bank is a part of another financial institution’s financial business group, the virtual bank must be under a solo consolidated group. After the “initial phase” (see below), other financial institutions and companies within the financial business group are prohibited from extending credit to or engaging in transactions similar to lending activities with the virtual bank. Capital fund requirements: If other financial institutions’ investment in a virtual bank increases the capital fund in the financial system beyond a safe level and this poses a risk to other financial institutions, the BOT may order the relevant financial institution to maintain capital funds as the BOT deems appropriate. Service channels and outsourcing: Virtual banks must provide services solely through digital channels, except when necessary. For example, with the BOT’s approval, a virtual bank may use other commercial bank electronic branches via an ATM pool system, use a banking agent to serve customer needs for cash, or occasionally provide on-site services. Initial Phase The “initial phase” runs from the date that the virtual bank commences its operations until it receives the BOT’s approval to become fully operational. During this period, certain BOT supervisory requirements are relaxed as follows: Governance: Virtual banks in the initial phase may request permission from the BOT to appoint a manager

Following the endorsement of the report on the study of opening entertainment complexes by Thailand’s House of Representatives and Cabinet in early 2024, the draft Entertainment Complex Bill, B.E. … (the “Entertainment Complex Bill”) finally became open for public hearing and is now under the consideration of the Ministry of Finance. The Entertainment Complex Bill aims to liberalize and facilitate the establishment of entertainment complexes that include casinos, allowing participation from domestic and foreign investors alike. Key Takeaways Under the Entertainment Complex Bill, an “entertainment complex” is a venue that operates at least four types of entertainment businesses alongside a casino. These may include five-star hotels, restaurants and bars, game centers, and department stores, among others. Based on the information publicly available as of the date of this publication, the Entertainment Complex Bill and its prospective subordinate legislation should encompass the following key requirements. Licensing requirements: Business operators seeking to operate an entertainment complex business must first obtain a license. To qualify, applicants must: (1) be a company incorporated in Thailand and (2) have a minimum paid-up capital of THB 10 billion. This license will operate as a “super license” covering not only casino activities but also other operations within the complex, such as hotels, restaurants, bars, and game centers, which, under normal circumstances, may require separate licenses or permits. The license will be valid for 30 years and may be renewed for an additional 10-year term upon expiration. The license fees may depend on the location of the entertainment complex. Minimum investment requirements: Based on the preparatory works by the drafting committee, entertainment complex business licenses may be classified into four different categories based on the size of the investment: small, medium, large, and extra-large. At this stage, licenses for the extra-large category, requiring an investment of THB 100 billion, are anticipated to

On July 23, 2024, the State Bank of Vietnam (SBV) published a draft circular regulating the implementation of open (publicly available) application programming interfaces, or Open APIs, in the banking industry (Draft Circular) to collect public comments. Open APIs in the banking sector are APIs of banks that allow third parties to process data for their own use or to provide products and services to customers. Urgent need Currently, the development of Open APIs in Vietnam is fragmented, with each bank using different API standards and security standards. There is no common standard for information technology systems, information storage, security, connectivity, or legal frameworks. Therefore, the promulgation of a regulation on Open APIs is urgently needed to create a clear legal basis and guidance for electronic banking transactions, especially in connecting to bank information systems and processing customer data safely, and creating new, innovative products and services to meet the increasing needs of customers. Cooperation of banks required The Draft Circular requires banks to provide Open API services to third parties for connection to the bank system and data processing. Banks have the right to refuse or suspend Open API services if third parties do not meet specified conditions. However, banks will be responsible for ensuring the quality and security of data, providing tools for customer data queries and revocation of third-party data processing rights, and coordinating with third parties and authorities to resolve issues. The Draft Circular standardizes Open API functions for all banks according to the Open API function list and the technical standards list specified in the Draft Circular. Open API service contract The template Open API service contract between banks and third parties using Open API services must have certain required contents such as provisions regarding confidentiality, data use purpose, and that the security level of information systems connecting to the bank

2024年7月17日、タイは、退職した従業員に対する退職手当に関する個人所得税の非課税金額を引き上げるために、歳入税に関する歳入法に基づく省令394号（B.E.2567）（Ministerial Regulation under the Revenue Code regarding Revenue Tax No. 394 (B.E. 2567)）を公布しました。 本省令に基づき、退職した従業員は、60万タイバーツを上限として、過去400日間の賃金に相当する退職手当の金額を上限として、退職手当の個人所得税が免除されます。この非課税措置は、定年退職又は有期雇用契約の満了に関する退職手当には適用されません。 従前、1998年から適用されていたこの非課税措置は、過去300日分の賃金に相当する金額にのみ適用され、上限は30万タイバーツでした。これにより、労働保護法（Labor Protection Act B.E.2541 (LPA) ）に規定された退職手当の最高賃金率と一致させていました。しかしながら、2019年にLPAが改正された際、退職手当の最高賃金率は、10年以上勤務した者の過去300日分の賃金に相当する率から、20年以上勤務した者の過去400日分の賃金に相当する率に引き上げられました。現在の省令は、改定された退職手当の賃金率に合わせるとともに、タイのインフレ率の上昇を考慮して制定されました。 新しい非課税率は、2023年1月1日以降に受領した課税所得に適用されます。2023年に源泉徴収され、2024年に申告された退職手当の超過分については、税務局の説明に従って、個人は税務局に還付を請求することができます。これは、所得税申告書への申告期限から3年以内に、適用される手続に従って行う必要があります。 退職手当の非課税措置、又はタイの雇用法に関する詳細については、Pimvimol Vipamaneerut（[email protected]）、Ketnut Pukahuta（[email protected]）、Dusita Khanijou（[email protected]）、又はChomanut Arif（[email protected]）までお問い合わせください。   備考：本和文は英文記事を翻訳したものです。原文については、以下のリンクをご参照ください。 Thailand Adjusts Income Tax Exemption for Severance Pay

In recent years, Thailand has witnessed a significant transformation in its financial landscape, particularly in the rapid adoption of financial technology (fintech). At the forefront of this evolution are electronic payment systems and services, which have revolutionized how individuals and businesses conduct financial transactions. This transformation has been driven by both traditional financial institutions and alternative financial service operators. Overseeing this dynamic landscape are two primary regulators: the Bank of Thailand (BOT) and the Securities and Exchange Commission (SEC). This article explores the development of electronic payment systems in Thailand, with a particular focus on the Payment Systems Act (PSA) of 2017 and its role in shaping the fintech ecosystem. Payment Systems Act In October 2017, Thailand took a significant step forward in regulating its burgeoning electronic payment sector by adopting the Payment Systems Act. This landmark legislation was designed to create and ensure electronic payment system stability and enhance consumer protection in the digital financial realm. The PSA establishes a comprehensive framework by categorizing electronic payment businesses into two main categories: payment systems and payment services. Electronic Payment Systems under the PSA The PSA recognizes two types of electronic payment systems that require specific licenses or registration: Central or network systems. These include systems that act as a center or network between service users for fund transfers, clearing, or settlement. Examples include: Inter-institution Fund Transfer System Payment card networks Settlement systems Systems of public interest. This category encompasses any other payment systems that may affect public interest, public confidence, or the stability and security of the payment infrastructure. Electronic Payment Services under the PSA The PSA also identifies several electronic payment services that require specific licenses or registration: Credit cards, debit cards, and ATM cards Electronic money E-payments Acquisition Payment facilitation Receipt of payment on behalf of others Electronic fund transfer Other payment services that may affect financial systems or public interest Looking Ahead As Thailand continues to embrace digital transformation

The popularity of the franchise business model has been growing rapidly in Southeast Asia in recent years, with some of the world’s top brands becoming common sights in the commercial districts and shopping malls of major regional cities in Cambodia, Indonesia, Laos, Myanmar, Thailand, and Vietnam. While for most countries in this part of the world, franchising has not been explicitly mentioned in legislation, well prepared franchise business operations can comfortably adapt to each country’s regulatory framework, and the growth is poised to continue even as the global retail sector redesigns and redoubles its efforts in the wake of the COVID-19 outbreak. In fact, the franchise business model, which is both global and hyper-local at once, is one of the most promising solutions that entrepreneurs are turning to in their quest to overcome the challenges of the new economic reality. The Regional Guide to Franchising Law in Southeast Asia provides key, up-to-date insights into the legal frameworks regulating franchise operations in these Southeast Asian countries, and helps brand owners understand the most relevant laws, authorities, and procedures for their business. Some of the essential topics covered for each jurisdiction include considerations in negotiating and designing franchise agreements, protecting intellectual property rights, and important information on judicial and arbitral procedures should a dispute arise between franchisor and franchisee. Practitioners from Tilleke & Gibbins’ offices in Cambodia, Indonesia, Laos, Myanmar, Thailand, and Vietnam contributed to guide—not only by providing legal expertise on the laws and mechanisms applicable in each jurisdiction, but also by examining strategies for establishing and running resilient franchise operations in Southeast Asia. The full guide can be accessed as a PDF through the button below.