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

January 11, 2013

Regulation of Investment Advisors in Thailand

Bangkok Post, Corporate Counsellor Column

Many people in Thailand are now focused on their personal investments. Investors want to know the products in which to invest and how to plan their finances. They are therefore increasingly turning to investment advisors. Given the increasing demand for these services, it is worthwhile to examine how investment advisors are regulated.

The Securities and Exchange Act includes investment advisory services within the scope of the securities business, which is subject to regulation by the Finance Ministry and the Securities and Exchange Commission (SEC). The Act defines “investment advisory service” as giving advice to the public, whether directly or indirectly, about the value of securities or the suitability of investing in those securities and the purchase or sale of any securities, for a fee or other remuneration. Specific SEC notifications may specify ways in which advice can or cannot be given.

Subject to certain exceptions, the law stipulates that securities business can be undertaken only by a limited or a public limited company, or by a financial institution established under other laws, and holding a license granted by the finance minister, on the SEC’s recommendation.

The licensing process is rigorous. The applicant must show the SEC that it meets all relevant requirements, such as not having financial hardship or any deficiencies in necessary controls and sound business conduct. The applicant must also show how it will maintain capital funds and set aside reserve capital as required.

The licensing process also gives consideration to the characteristics of the major shareholder(s) and any director, manager, or person with managerial authority. For example, such managerial personnel must not be or have been bankrupt, nor imprisoned by a final judgment for an offense related to property.

A securities company must comply with the rules, conditions, and procedures specified in the notification of the Capital Markets Supervisory Board. The board may also specify fees and/or service charges that the company may charge its customers.

Once licensed, the company’s appointment of personnel to perform the duties of analyzing investments and giving investment advice is subject to SEC approval. Such investor contacts must meet criteria with respect to education, experience, and/or examination requirements. As with management personnel, investor contacts must have good character. They must not have any record of deceitful, fraudulent, or dishonest management of assets or any improper behavior that materially affected any clients, investors, companies, shareholders, or the money or capital market as a whole. The relevant regulations go into greater depth as to the specifics.

The company must also have in place systems that demonstrate its readiness to undertake the business, including internal controls for the giving of advice and a system for monitoring investments of the advisory company and its employees. It must also have a compliance supervisor in charge of rules related to prevention of conflicts of interest and internal controls as well as to supervise investor contacts for compliance with the law, notifications, and standards of professional conduct.

An investment advisory company, in contacting and soliciting clients, must prepare client information and take into account each client’s investment objectives, knowledge, and understanding related to investment, acceptable risks, and other factors when providing expertise. An agreement to provide advisory services must specify the client’s right to receive clear and sufficient information relating to the provision of those services.

Any term or condition that may cause any conflict of interest between the client and the advisory company and its related persons requires the client’s consent. Advisors must disclose the information necessary for making investment decisions sufficiently and within an appropriate period of time. In this regard, the information must be correct and up to date and must not have any characteristics that mislead or distort facts. There are also extensive record-keeping requirements.

The company must also maintain a system for handling complaints about services promptly and must fulfill reporting obligations to the SEC.

Collateral and/or liquid assets must also be maintained to compensate customers for damage arising from incorrect or incomplete performance of the advisory service. This can include, for example, an insurance policy, a letter of guarantee issued by a financial institution, or other collateral as prescribed by the SEC.

In brief, Thai investment advisors are subject to a robust regulatory regime, which features substantial protection for investors. But it is important to bear in mind that SEC regulations provide a number of exceptions and additional requirements. Derivatives advisors are also subject to a regulatory regime, analogous to the above, when advising on derivatives.

Anyone intending to provide investment advisory services or giving advice on derivatives in Thailand should consult counsel to ensure compliance with applicable laws. As for individual investors, they should make certain they are doing business with licensed advisors so that they benefit from the SEC’s protection.

RELATED INSIGHTS​ 

December 26, 2025
The Bank of Thailand (BOT) has released the Guidelines for Digital Fraud Management, which took effect on December 17, 2025, incorporating certain amendments to the draft guidelines issued in March 2025. These official guidelines aim for end-to-end digital fraud prevention, with a particular focus on mule accounts, to enhance trust and security in Thailand’s financial system. The guidelines apply to “financial service providers,” including: Financial institutions and special financial institutions under the Financial Institution Business Act; and Operators of Inter-institutional Fund Transfer System e-money services and e-fund transfer services under the Payment Systems Act. Besides commercial banks and e-money operators that offer fund-transfer services, other providers may adopt requirements based on risk proportionality and baseline standards set out in the guidelines (for instance, an e-money operator that does not offer e-fund transfer services could consider implementing a fraud monitoring and detection system according to the risk level of its service). The guidelines establish the following key requirements: Policy and oversight. Directors and senior executives of financial service providers must adopt appropriate “end-to-end” fraud management policies and KPIs to manage digital fraud, covering prevention, monitoring, detection, management, resolution, and support for affected customers. The fraud management policy must be regularly reviewed, and whenever there is a situation or change that significantly affects the efficiency of the fraud management. Any significant update to the policy must first be approved by the board of the financial service provider. The BOT also encourages providers to collaborate in establishing industry standards aligned with applicable laws and regulations to ensure consistency and best practices across the sector. Fraud management processes. Financial service providers must establish a clear framework for managing digital fraud throughout the customer lifecycle—from customer onboarding to service termination—covering at least the following processes: Know your customer (KYC) and customer due diligence (CDD):
November 24, 2025
A recent warning from the Central Bank of Myanmar (CBM) against cryptocurrency use upholds the country’s ongoing strategy of enforcing strict prohibitions on unauthorized cryptocurrency activities while also promoting the controlled development of a central bank digital currency (CBDC). The CBM’s warning, issued November 16, 2025, reminded the public of announcements in May 2019 and a notification in May 2020 confirming that all online and offline cryptocurrency transactions are strictly prohibited. The CBM also clarified that no financial institution in Myanmar is authorized to deal with digital currencies. The warning highlighted global risks, such as money laundering, scams, tax evasion, hacking, and severe financial losses caused by price volatility and insufficient regulation. The CBM urged the public to use only legitimate banking channels and avoid illegal cryptocurrency activities. The warning comes five months after the CBM issued a notification announcing the formation of the Central Committee for the Issuance of a Central Bank Digital Currency. This committee includes senior CBM officials, representatives from relevant ministries and the banking sector, and technology experts. Its main role is to research CBDC models, test secure digital payment systems, and ensure that any future implementation aligns with Myanmar’s monetary policy and financial stability objectives. Taken together, these two actions illustrate the CBM’s continued pursuit of its dual strategy to promote innovation through CBDC development while prohibiting cryptocurrency use. Businesses should note that while CBDC pilot programs may appear in the future, cryptocurrencies remain off-limits.
September 24, 2025
On September 12, 2025, the Bank of Thailand (BOT) officially released its AI Risk Management Guidelines for Financial Service Providers, building upon the draft guidelines issued in June 2025. The guidelines reflect a balanced approach, encouraging innovation while safeguarding financial stability and consumer protection. The guidelines are targeted at all financial service providers, including financial institutions and special financial institutions under the Financial Institution Business Act, as well as payment providers under the Payment Systems Act. The guidelines apply to both AI systems developed in-house and those developed by third parties that are adopted for use by financial service providers. AI Risk Management Guidelines The two main pillars in managing AI risk are (1) governance of AI system implementation and (2) AI system development and security controls, consisting of the following key elements: 1. Governance Stakeholder roles and responsibilities. Boards and senior management assume accountability for decisions and operations involving AI systems, and are responsible for defining roles and responsibilities for AI oversight. This includes establishing an AI system usage policy, designating personnel responsible for AI risk management, and building awareness of AI-related risk within the organization. Organizations are expected to foster internal capabilities to use AI securely and avoid overreliance that could compromise business continuity or customer service. AI system usage policy. Policies governing AI usage should align with organizational goals, regulatory obligations, and recognized responsible AI frameworks—such as the FEAT principles (fairness, ethics, accountability, and transparency). These policies should be reviewed regularly to respond to technological advancements and evolving risk profiles. Risk management throughout the AI lifecycle. Risk management should encompass the entire AI lifecycle, from establishing risk appetite to implementing continuous risk assessment and control measures tailored to specific use cases. Financial service providers should assess risks and impacts of AI usage on operations and customer services.
September 12, 2025
On September 10, 2025, Vietnam’s National Credit Information Center (CIC) reported to the Vietnam Cybersecurity Emergency Response Team (VNCERT) a suspected significant cybersecurity incident involving unauthorized access to the CIC’s credit information database. A hacker group has claimed responsibility and allegedly posted over 160 million records for sale, including sensitive personal and financial data. Implications for Banks and Financial Institutions Companies that share customers’ or potential customers’ personal data with the CIC for credit scoring or other purposes—and continue to act as a data controller for such data—may be obligated under Vietnam’s Personal Data Protection Decree (PDPD) and related regulations to: Notify A05 (Department of Cybersecurity and High-Tech Crime Prevention) and the State Bank of Vietnam without delay. Inform affected individuals if their personal data is at risk. Recommended Actions Companies that could be impacted by this data breach should take the following actions: Conduct an internal review of CIC-related data in their systems, and identify whether and how the systems have been affected by this incident. Assess whether to notify regulators and customers/potential customers. Enhance cybersecurity controls, monitor for suspicious activity, and implement additional safeguards to prevent secondary breaches.