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

December 13, 2021

Bank of Thailand to Update Foreign Exchange Business Regulations

Subscribe to Updates

On November 23, 2021, Thailand’s cabinet approved in principle the amended Ministerial Regulation No. 13 issued under the Exchange Control Act, B.E. 2485 (1942), as amended (ECA).

The ECA is an integral instrument of the Bank of Thailand (BOT) for regulating businesses relating to foreign means of payment (i.e., foreign exchange business) and controlling inward and outward remittances as well as exchange and conversion between Thai baht and foreign currencies. Under the current ECA, no party may purchase, sell, lend, exchange, or transfer foreign currencies except for authorized juristic persons (bank and non-bank entities) or authorized individuals who are licensed by the Ministry of Finance.

The major amendments to Ministerial Regulation No. 13 of the ECA introduce a number of changes to the current regulations for foreign exchange business operations:

  • Expansion of the scope of foreign exchange business
    The scope of a foreign exchange business is currently limited to purchasing, selling, lending, and exchanging foreign currency in the form of banknotes, coins, and travelers’ cheques (i.e., banknotes-to-banknotes conversion only). The new amendments will expand the scope of foreign exchange business to include more foreign currency payment types. For instance, foreign travelers will be able to use credit or debit cards issued by a foreign commercial bank to exchange for cash (i.e., card-to-banknotes conversion).
  • Additional modes of authorizing foreign exchange businesses
    Licensing is currently the only mode of authorization for a foreign exchange business in Thailand. Under the amended regulations, there will be two options for authorization: licensing or registration. While the exact requirements and definition of “registration” will become clearer after the actual amended regulation and any subordinate legislation become available, this indication of an additional mode of authorization may imply varying requirements and burdens in the application process.
  • Allowance of a foreign exchange business license to cover all branches and channels
    A license is currently granted for a fixed location or channel (i.e., one-to-one), which means each additional branch of business operations requires a separate license. Under the amendments, licenses will no longer be tied to a specific location or channel but will cover all locations of business operations (i.e., one-to-many). However, the new registration mode is one-to-one, meaning that every business branch or service channel will have to apply for separate registration.
  • Relaxation of foreign-source income rules
    Current regulations require those who earn income in foreign currencies from foreign sources to either sell the currency to a commercial bank in Thailand or deposit it into a foreign-currency account. The amended regulations allow such foreign currencies to also be used for other transactions, such as payment of trade debts. In addition, it will be possible to use foreign-source income in foreign currencies for transactions (other than selling or depositing) with any authorized juristic person or authorized money exchange operator that has successfully applied for a foreign exchange business license or registration in Thailand.
  • Removal of possibility for individuals to apply for a foreign exchange business license
    Currently, both individuals and juristic persons (e.g., companies) can apply for a license to engage in a foreign exchange business—and as of October 19, 2021, BOT statistics indicated that 114 of the 2,326 authorized foreign money exchange operations in Thailand were individuals. Under the new regulations, however, individuals may no longer apply for a license. Only juristic persons will be able to apply for a license to engage in the foreign exchange business. Individuals who are currently holding a license will be allowed to continue their business operation for up to three years from the effective date of the amended ECA; beyond that they will no longer be allowed foreign exchange business operations in Thailand.
  • New possible disqualification for directors, management, and majority shareholders
    Under the current rules, individuals are disqualified from serving as directors, managers, and major shareholders of a license holder by bankruptcy, imprisonment for a foreign exchange violation, or a sentence for a money-laundering or counter-terrorist financing crime. The amended regulations add another offense to the list of possible disqualifications: conducting a foreign exchange business without a valid license or registration.

The expected modernizing effects of this draft amendment on the regulatory regime for foreign exchange businesses come in response to the fast development of the fintech industry and emerging innovative means of payment. The draft also adopts more stringent requirements and international standards in order to achieve good governance.

Following the cabinet approval, the draft amendment to Ministerial Regulation No. 13 under the ECA will undergo consideration by the Council of State, after which it will take effect. This process will likely be completed in the coming months.

For guidance on any aspect of exchange control or foreign investment regulations in Thailand, please contact Kobkit Thienpreecha at [email protected] or +66 2056 5534, Nutavit Sirikan at [email protected] or +66 2056 5510, or Thammapas Chanpanich at [email protected] or +66 2056 5561.

Related Professionals

Practices

Banking and Finance

Capital Markets

Corporate/M&A

Location

RELATED INSIGHTS​ 

April 3, 2025
Thailand has proposed amendments to the Anti-Money Laundering Act B.E. 2542 (1999) as the country steps up its efforts to combat economic crimes and corruption. One of the primary objectives of the amendments is to enhance the effectiveness of measures curbing the use of nominees to help foreign nationals operate restricted or prohibited businesses in violation of the law. If these proposed updates are implemented, they will substantially strengthen existing legislation related to the use of nominees and bribing government officials, including officials of foreign governments and international organizations. These offenses would be treated as predicate violations under the amended legislation. The draft amendments are currently open for a public comment period, which is set to conclude on April 25, 2025. Highlights of the proposed amendments are detailed below. Predicate Offenses The draft amendments propose adding the concept of a “predicate offense” covering the following: Bribery: Giving, offering, or promising to give assets or benefits to Thai or foreign public officials, or officials of international organizations. Acting as a nominee: Assisting, supporting, or engaging in the business operations of a foreign national who is not permitted to operate that business; jointly operating a business with a foreign national under the guise that it is solely owned by the Thai national; or holding shares on behalf of a foreign national in a partnership, limited company, or any other legal entity to help the foreign national conduct business without the permits required under the Foreign Business Act. Under the draft amendments, Thai individuals or juristic persons who have agreed to take any of these actions, as well as foreign nationals who allow such assistance in their business operations, will be liable for committing a predicate offense under the Anti-Money Laundering Act. The draft proposes a prescription period of 15 years from
Read More
March 28, 2025
On October 25, 2024, the State Bank of Vietnam (SBV) issued Circular No. 49/2024/TT-NHNN (“Circular 49”) amending and supplementing certain provisions of Circular No. 11/2022/TT-NHNN dated September 30, 2022, on bank guarantees (“Circular 11”). However, shortly thereafter, the SBV replaced both Circular 11 and Circular 49 with Circular No. 61/2024/TT-NHNN (“Circular 61”) dated December 31, 2024, which incorporates most of the updates from Circular 49 while introducing further amendments to bank guarantee regulations to align with the 2024 Law on Credit Institutions and 2023 Law on Real Estate Business. Circular 61 has an effective date of April 1, 2025. Below, we highlight some new regulations on bank guarantees under Circular 61, including those that were adopted from Circular 49. Updated Definitions Circular 61 broadens the definition of “customer” in bank guarantee relationships, introducing the possibility of a fourth party. Traditionally, a customer would request a credit institution to guarantee its obligations. Under the revised framework, a customer may also request the credit institution to issue a guarantee for another party, such as a parent company requesting a guarantee for its subsidiary. This change establishes a broader scope of parties involved in a bank guarantee relationship, which now includes the customer, the guarantor, the guaranteed party, and the beneficiary. Circular 61 also updates the definitions of “bank guarantee”, “cross-guarantee”, and “guaranteed party” to align with the term “bank guarantee” as defined in the 2024 Law on Credit Institutions. This includes requirements on mandatory debt acknowledgement. Bank Guarantees for Sale of Off-Plan Housing Circular 61, in alignment with Circular 49, the Law on Credit Institutions, and the Law on Real Estate Business, allows foreign bank branches and commercial banks (the “Guarantor”) to guarantee off-plan housing with a detailed procedure. The guarantee agreement between the Guarantor and the real estate project investor
Read More
March 21, 2025
Vietnam’s Law on Securities of 2019 was one of several laws amended (“Amended Securities Law”) under the wide-ranging Law No. 56/2024/QH15 passed by the National Assembly on November 29, 2024. The amendments came into force on January 1, 2025, with certain provisions related to professional securities investors and the eligibility criteria for public companies becoming effective on January 1, 2026. Below are some of the key points of the Amended Securities Law. Changes to Professional Securities Investors Professional securities investors (PSIs) are investors who have adequate financial capacity or securities qualifications and can participate in private placements and private funds, among other investment activities. Under the Amended Securities Law, foreign investors, including individuals and organizations, are now automatically classified as PSIs, without having to meet any requirements regarding financial capacity. This loosening of requirements is expected to attract more foreign investment. However, from January 1, 2026, individual PSIs will only be able to purchase, trade, and transfer privately placed corporate bonds that: (i) have been given credit ratings and are secured by collateral, or (ii) have been given credit ratings and covered by payment guarantees from credit institutions. Meanwhile, institutional PSIs will not be bound by these restrictions relating to privately placed corporate bonds. Protecting Shareholders in Private Securities Issuance The Amended Securities Law introduces additional conditions for private issuance of shares, convertible bonds, and warrant-linked bonds by public companies, and revises the required contents in the issuance plans from “criteria and number of investors” to “number of shares, offering price, or principles for determining the offering price.” This change promotes shareholder supervision and protects minority shareholders from overly powerful boards of directors. Expanded Powers of SSC The Amended Securities Law grants the State Securities Commission (SSC) new powers to suspend and cancel private placements of securities and adds
Read More
March 21, 2025
Thailand is continuing on its path toward comprehensive legislation to address climate change. In November 2024, the country’s Ministry of Natural Resources and Environment (MNRE) launched a public hearing on a new draft Climate Change Act following revisions made after an earlier hearing on a previous draft of the act. The revised version strengthens Thailand’s climate policy framework by introducing the Carbon Border Adjustment Mechanism (CBAM), modeled after the EU’s system of the same name. The new draft also restructures the planned Emissions Trading Scheme (ETS) and enhances carbon-tax provisions. These initiatives aim to minimize carbon leakage, promote fair competition for domestic industries, and encourage lower greenhouse gas (GHG) emissions. As of March 2025, the Department of Climate Change and Environment, under the MNRE, is awaiting the Ministry of Finance’s input on the draft act’s establishment of the Climate Fund, a fund to support business innovation in responding to climate change. After incorporating this feedback, the department will submit the refined draft for cabinet approval, expected in 2025. The legislation will then undergo Council of State review, with implementation expected in 2026. Key Provisions The draft Climate Change Act contains a number of provisions that will affect businesses. Some of the most relevant are discussed below. Mandatory ETS The ETS is a mandatory mechanism designed to control GHG emissions by setting emissions caps for designated industries in alignment with national targets. Under this system, businesses receive emissions allowances allocated through free allocation or auctions. This scheme incentivizes emissions reductions by allowing businesses that emit less than their allocated allowances to sell their surplus allowances. The specific business sectors covered by the ETS have not yet been identified in the draft act, as details are expected to be in subordinate legislation. However, it is anticipated that the sectors will align
Read More