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

May 9, 2025

Thai SEC Eases Rules on Fundraising, but Risks Remain

Subscribe to Updates

Thailand’s Securities and Exchange Commission (SEC) has recently amended its regulation on the definition of professional investors, which aids in the issuance of notes to broader private funds by not requiring looking through to the qualifications of the actual investors. However, issuers of notes will still need to take care to comply with existing regulations.

Notes under the Thai Regulatory Framework

The topic of promissory notes was recently in the Thai news after being raised in a no-confidence debate against the government, so this is a fitting time to review the use of notes (in particular bills of exchange and promissory notes) as commonly used financial tools for lending in commercial transactions. These instruments serve as a means of debt settlement and can also be used for fundraising purposes. When using notes, issuers must consider not only tax laws but also fundraising regulations under the Securities and Exchange Act B.E. 2535 (1992).

The SEC has classified notes issued to raise funds from more than 10 persons as securities requiring approval from the SEC and an effective filing of a prospectus, with certain exemptions. These exemptions include instances that are not considered “public fundraising,” such as notes issued:

  • For debt settlement,
  • For management of cash flow, which is common in commercial transactions,
  • As evidence for lending within group companies (intragroup issuance), or
  • For lending from financial institutions.

In addition, private placement of notes is another route considered as having been deemed approved (i.e., not requiring an approval process if the required criteria have been met) and may be exempt from filing requirements, depending on the types of investors being offered notes.

Private placement includes offering notes with a minimum face value of THB 10 million for each and maturity not exceeding 270 days from the issue date to professional investors, which will be considered as having been deemed approved, with a filing exemption for foreign professional investors and only minimal disclosure required for Thai professional investors. Professional investors are limited to persons specified in the SEC Notification No. GorJor. 39/2564.

Recent Regulatory Amendment

Prior to the regulatory amendment from the SEC, professional investors included private funds with look-through criteria ensuring that the actual investors were qualified, being financial institutions or having financial status equivalent to ultra-high-net-worth or high-net-worth investors.

The regulatory amendment that came into force May 1, 2025, amended SEC Notification No. GorJor. 39/2564 to simply designate private funds as one of the specified types of professional investors, eliminating the need to scrutinize the actual investors. The SEC considers fund managers as possessing the necessary expertise and a fiduciary duty to manage investments appropriately on behalf of their clients, making additional look-through requirements unnecessary. This can better accommodate issuance of notes to private funds without requiring another layer of scrutiny of funds’ beneficial owners, which can also apply to both domestic and international private funds.

This regulatory change makes funding more accessible for issuers, as private funds alone can be considered professional investors, making them qualified for private placements. This approach aligns more closely with standard loans, facilitates shorter negotiations by eliminating the need for detailed loan agreements, and allows for commercially agreeable terms with private funds through the issuance of notes.

Related Professionals

Practices

Capital Markets

Location

RELATED INSIGHTS​ 

July 8, 2026
The Stock Exchange of Thailand (SET) has issued new oversight and disclosure rules, effective July 1, 2026, overhauling the previous requirements. The reforms apply to listed companies, REITs, and property and infrastructure funds, and aim to enhance transparency, align with international standards, and ensure timely investor information. The key changes and practical implications are highlighted below. Major Shareholder Reporting When a shareholding change reaching or crossing 5% or any subsequent multiple of 5% is reported under section 246 of the Securities and Exchange Act or a tender offer is completed (except for voluntary delisting), listed companies must disclose an updated shareholder list for the month in which the triggering event occurred. The list must be compiled within five business days after month-end and disclosed within 14 days thereafter. Noncompliance will trigger a “notice pending” (NP) sign. This replaces the previous requirement to disclose shareholder lists only at annual general meetings or on record dates. Companies should coordinate with their share registrars to meet the new event-driven timelines. New Financial and Internal Control Disclosures The new rules require disclosure of material impairment, expected credit losses, and unreturned business deposits when these reach specified thresholds. Companies must also disclose events or indicators that may materially affect their internal control systems. Boards and audit committees should expect to escalate accounting and internal-control issues earlier, as these matters may now trigger standalone SET disclosure obligations—not just financial statement treatment. Backdoor Listing With the Securities and Exchange Commission’s regulation on material transactions (MTs) taking effect on July 1, 2026, and now serving as the primary, standalone framework governing acquisitions and disposals, the SET needed to issue a standalone rule on backdoor listing matters. These matters had been covered by a previous regulation on MTs issued by the SET. The key differences between the SET’s
Read More
June 29, 2026
Thailand’s Securities and Exchange Commission (SEC) is seeking public input on significant amendments to the Securities and Exchange Act B.E. 2535 (1992) that would address recurring market abuses and eroded investor confidence observed by the SEC. Published on June 24, 2026, the consultation document targets share-pledging disclosure failures, hidden beneficial ownership, and fraudulent transactions by listed companies, all of which are issues that have threatened share prices and market stability across the Thai capital markets. Comments on the proposals are due by July 24, 2026. Mandatory Disclosure of Short Sales and Share Pledges The draft amendments introduce new reporting obligations for both short sales and share pledges. Persons who sell listed securities without having such securities in their possession (“short sales”) must comply with rules prescribed by the Capital Market Supervisory Board, ensuring standardized practices and preventing risks from such transactions. Major shareholders who pledge or encumber their shares in significant amounts must report those arrangements to the SEC, which may then disclose the information to the public. These amendments directly respond to recent market abuses, including short selling without proper safeguards and instances where directors or major shareholders have pledged large share blocks without disclosure to investors, only to have those shares forcibly sold when collateral was called, causing dramatic share price declines and disrupting ownership structures and market stability. Reportable transactions for share pledges include the following: Shares used as margin account collateral Shares pledged as loan security, with immediate transfer upon default Shares formally pledged under the Civil and Commercial Code or registered with the Thailand Securities Depository Failure to report share pledges triggers criminal penalties, as does failure to comply with short sale requirements. By requiring advance disclosure and standardized short sale procedures, the SEC aims to enable investors to assess ownership stability and default
Read More
June 18, 2026
Thailand’s Securities and Exchange Commission (SEC) has released a detailed draft notification expanding its oversight to cover the funding sources behind major shareholdings in licensed securities and digital asset business operators. Published on June 8, 2026, as Public Hearing Document No. 30/2569, the draft builds on funding-source principles introduced in an April hearing and on recently amended Ministry of Finance notifications issued in February 2026 that broadened the definition of major shareholder of licensed securities and digital asset business operators. A public comment period on the draft closes on June 23, 2026. An earlier version of the SEC’s proposal brought the issue of funding behind significant shareholdings within the SEC’s regulatory perimeter, signaling intent to look beyond shareholding to the persons and capital ultimately financing major shareholdings in licensed securities and digital asset business operators. The concern is that control may be exercised through financing arrangements rather than through equity ownership alone. The draft notification advances that initiative into a more detailed regulatory framework, as summarized below. Expanded Definition Captures Funding Sources Throughout Ownership Chains The draft regulation introduces a “material funding source” concept. A material funding source is the principal capital that enables a major shareholder to acquire its shareholding, without which the shareholding could not be obtained. Under the proposed rules, any person who provides such funding, whether directly to the major shareholder or indirectly through any tier of the ownership chain above the operator, is deemed a controller subject to SEC approval. The draft also captures any person acting as a conduit or intermediary in facilitating financial assistance to a major shareholder, deeming each of these persons to be a material funding source and aggregating it into the same control group as the ultimate funding source. The definition covers not only cash loans and equity investments,
Read More
May 25, 2026
After several years of policy discussion and continued efforts led by the Ministry of Commerce (MOC) to relax the list of reserved businesses under the Foreign Business Act B.E. 2542 (1999) (FBA), the reform process has now reached a significant milestone. On May 12, 2026, the Thai cabinet approved in principle two draft subordinate legislative instruments aimed at delisting certain reserved business activities under the FBA and reducing licensing requirements for foreign business operators. These developments signal a renewed and concrete effort by the government to modernize Thailand’s business regulatory framework in order to attract foreign investment and boost Thailand’s competitiveness in the global market. Nine Businesses Set for FBA Delisting Below is a list of the nine businesses that are being targeted for delisting from the FBA’s restrictions. A draft ministerial regulation would delist the first eight reserved businesses, while a royal decree has been drafted to delist the ninth business: Telecommunications services (Type 1 license only, covering operators without their own telecommunications infrastructure), under the supervision of the Office of the National Broadcasting and Telecommunications Commission. Treasury center services subject to the Foreign Exchange Control Act B.E. 2485 and under the supervision of the Bank of Thailand. Securities-collateralized lending, pursuant to the laws governing securities and exchange and derivatives regulated by the Securities and Exchange Commission. Agency, dealer, advisory, or fund management services relating to derivatives where the underlying assets fall outside the scope of the Derivatives Act B.E. 2546 (2003) Intra-group shared services, including administrative, human resources, and IT functions Intra-group domestic debt guarantee services Leasing of partial space for installation of financial service machines and automatic vending machines for employee use Petroleum drilling services Trading of agricultural product derivatives through a futures exchange, with physical delivery or receipt of agricultural products at a futures exchange–designated
Read More