Thailand’s Office of the Consumer Protection Board (OCPB) has initiated a sweeping regulatory review of licensed direct sale and direct marketing businesses in Thailand and is in the process of notifying business operators to submit their annual business report and financial statement to the OCPB as part of their postlicensing obligations. This move marks a significant escalation in the government’s efforts to enforce compliance and transparency in the sector, which has faced growing scrutiny in recent years.

Key Regulatory Considerations

All businesses holding a direct sales or direct marketing license are required to submit their audited financial statement along with their business operation report to the OCPB within 60 days from the end of their fiscal year (extendable for up to 30 days by request, if necessary).

The OCPB is currently conducting license audits as part of its enforcement duties. The office aims to complete audits for at least 90% of the 2,983 registered businesses that have obtained their license since 2022. This includes a review of the business conduct of the license holder.

New license applications are also under scrutiny. Applicants are currently being subjected to background checks, and the OCPB has signaled a more rigorous vetting process moving forward.

Impact of Noncompliance

Failure to comply with these reporting obligations may result in escalating enforcement actions, including:

1. Official notice to rectify noncompliance within a specified timeframe.
2. Revocation of business registration, if the operator fails to respond.

Revocation of business registration could result in a five-year prohibition on reapplying for a direct sales or direct marketing license following the revocation.

The OCPB has already initiated outreach efforts, including SMS and email notifications, and has hosted seminars to raise awareness of these obligations. These measures are part of a broader initiative to enhance transparency and consumer trust in the sector.

Businesses operating in the direct selling and marketing space should take immediate steps to:

• Ensure timely submission of financial reports in accordance with the Direct Sales and Direct Marketing Act and OCPB directives.
• Review internal compliance frameworks to align with the Direct Sales and Direct Marketing Act and related consumer protection laws.
• Prepare for potential audits and maintain clear documentation of business activities.