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

September 3, 2019

Thailand’s SEC Provides Legal Clarity with Equity Crowdfunding Regulations

Subscribe to Updates
Informed Counsel

Crowdfunding in Thailand has generally been regulated by the Securities and Exchange Commission (SEC), and this covered a narrow scope of crowdfunding activities, including offering newly-issued shares via “electronic systems or networks.” Recently, the SEC issued new regulations expanding the scope of permitted crowdfunding activities to include other parts of equity crowdfunding. SEC Notification Tor Jor. 21/2562 Re: The Offering of Securities for Sale through Crowdfunding Portals and related regulations came into force on May 16, 2019, and replaced the previous SEC notifications on crowdfunding. The new SEC crowdfunding notification expands previous restrictions, including allowing issuers to offer “plain vanilla” debentures as well as shares, and adjusting the specific restrictions on issuing securities to retail and non-retail investors.

Crowdfunding Portals

The new SEC crowdfunding notification defines crowdfunding portals as websites, mobile apps, or other similar electronic media developed for offering securities for sale. Crowdfunding portals must be incorporated in Thailand, must have a minimum paid-up registered capital of THB 5 million, and their systems must be ready for use upon applying to the SEC for approval to operate.

After receiving approval from the SEC, crowdfunding portals must operate within the scope of their license and comply with the standards and requirements of the notification. This includes an obligation to record information relating to the issuing of securities on the platform and keep that information for at least two years after the date of offering. Crowdfunding portals are also required to disclose transaction summary reports to the SEC.

Crowdfunding portals are responsible for complying with Know Your Customer procedures relating to their investors and must also assess each investor’s knowledge and abilities regarding investment in shares and debentures. Crowdfunding portals must also provide investors with information about investment, including the benefits and risks of investing in shares and debentures, rights of cancellation, and information on the issuers.

Issuers

Under the new SEC crowdfunding notification, an issuer must not be listed on the Stock Exchange of Thailand, must be a company incorporated under Thai law, and must intend to use the proceeds of newly-issued shares and debentures to fund the company’s operations, or for refinancing. Qualifying issuers will be exempt from licensing requirements; however, they must only offer securities through one crowdfunding portal unless they receive approval from the SEC to do otherwise. Issuers must also file the results of offering crowdfunding securities with the SEC and must appoint a securities registrar.

Issuer compliance with SEC crowdfunding regulations is generally the responsibility of the crowdfunding portal on which the issuer is offering securities. Crowdfunding portals are responsible for screening issuers wishing to offer crowdfunding shares or debentures via the crowdfunding portal, in order to determine whether the issuer complies with the requirements under the SEC crowdfunding notification. If the crowdfunding portal discovers, or has reason to believe, that an issuer violates the provisions of the notification or other law, the crowdfunding portal must reject the issuer and inform the SEC of the violation immediately.

Investors

Non-retail investors include institutional investors, mutual fund companies and venture capital investors, angel investors, and other crowdfunding portals. The term “angel investors” refers to private individuals who either:

  • have invested directly in shares for a period of at least one year, and (i) have net assets of at least THB 50 million, not including the property value of that person’s residence, or (ii) have an annual income of at least THB 4 million; or
  • have knowledge and skill relating to business operation or investment, experience assessing the value of business operators, or experience advising on business development

An issuer may not offer crowdfunding securities to more than 50 different angel investors and crowdfunding portals in any 12-month period.    

Retail investors are individual investors who do not meet the criteria listed above. The value of crowdfunding securities offered by an issuer to a retail investor must be no more than THB 100,000 to each retail investor. The value of crowdfunding securities offered by an issuer to all retail investors must be no more than THB 20 million within 12 months of the first offering of crowdfunding securities, and the total value of crowdfunding securities that may be offered to individual investors starting from the date of first offering is capped at THB 40 million.

Conclusion

Thailand’s embrace of crowdfunding and innovative crowdfunding platforms is a further strengthening of the increasingly active and profitable fintech sector in the country. While tech entrepreneurs had already been taking steps in the equity crowdfunding space, the SEC’s actions have codified the process, aiming to facilitate grassroots financing through crowdfunding initiatives in a way that mutually benefits both entrepreneurs and their supporters (i.e., investors) as well as the platform operators who bring these groups together. The effect of this development will become clear in the coming years, but in principle it should smooth out challenges, remove uncertainty, and provide legal clarity for greater crowdfunding innovation in the country.

Download Full Article

Practices

Banking and Finance

Capital Markets

Location

RELATED INSIGHTS​ 

May 9, 2025
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,
Read More
May 5, 2025
On April 29, 2025, the government of Vietnam promulgated Decree No. 94/2025/ND-CP with regulations on a controlled “sandbox” for innovative fintech solutions in the banking sector (Decree 94). The decree aims to promote innovation, modernize banking, and enhance financial inclusion while assessing risks and benefits of fintech solutions in a controlled testing environment. Fintech Sandbox Currently, the fintech sandbox focuses on three specific areas: Credit scoring Open API data sharing Peer-to-peer (P2P) lending Eligible participants for the fintech sandbox include: Credit institutions and foreign bank branches (except for P2P lending) Fintech companies operating in Vietnam Cross-border supply by foreign providers is not included in the sandbox framework. Eligible participants are permitted to provide fintech solutions only within the scope specified in the Certificate of Sandbox Participation issued by the State Bank of Vietnam in consultation with other ministries. P2P lending companies face specific restrictions within the fintech sandbox, including prohibitions against: Providing security for customer loans Operating as a customer (i.e., P2P lender or borrower) Providing P2P lending solutions to pawn shops The maximum sandbox period is two years, with the possibility of extension as permitted by law. The outcomes of the fintech sandbox will serve as a practical basis for authorities to develop and refine future fintech regulations. It is worth noting that participation in the sandbox does not guarantee that participants will meet relevant business and investment conditions that may be stipulated in future regulations. Decree 94 will take effect on July 1, 2025, signaling that the Vietnamese government intends to take a proactive approach to fostering fintech development. Implications Parties interested in participating in the fintech sandbox should begin preparing now to be ready to apply for a Certificate of Sandbox Participation when the decree takes effect.
Read More
May 2, 2025
Attorneys from Tilleke & Gibbins have updated the latest edition of Doing Business in Thailand, a Q&A-style guide from Thomson Reuters Practical Law that offers an overview of key legal considerations for companies operating in jurisdictions worldwide. The contribution outlines the country’s legal and regulatory framework for foreign investment and business operations and reflects the latest legislative developments. The chapter addresses the following core topics: Legal system: Structure of the courts and the codified nature of Thai law. Foreign investment: Business restrictions under the Foreign Business Act, sector-specific regulations, exchange control rules, and investment incentives. Business vehicles: Overview of partnerships, private and public limited companies, and other legal entities. Employment: Labor protections, employment contracts, foreign worker requirements, and termination procedures. Tax: Corporate and personal income tax, indirect taxes, and tax obligations for residents and non-residents. Intellectual property: Registration and enforcement of patents, trademarks, designs, and copyrights. Data protection: Key provisions of the Personal Data Protection Act and related compliance obligations. Competition law: Regulatory framework under the Trade Competition Act. Anti-bribery and corruption: Relevant legislation and enforcement mechanisms. E-commerce and digital business: Legal regime for online transactions and digital platforms. Marketing and advertising: Consumer protection laws and regulations affecting advertising and marketing practices. Product regulation and liability: Safety standards, liability regimes, and roles of enforcement authorities. Practical Law, a legal reference resource from Thomson Reuters, publishes a range of guides for hundreds of jurisdictions and practice areas. The insurance and reinsurance guide is a valuable resource for legal practitioners, covering numerous jurisdictions worldwide. To view the latest version of the guide, please visit the Practical Law website and enroll in the free Practical Law trial to gain full access.
Read More
April 30, 2025
With a favorable crypto climate from the Trump administration in the United States, Thailand is ready for digital asset platforms and has market appetite. This article highlights the country’s regulatory initiatives supporting the growth of digital assets like crypto, stablecoins, and smart contracts, along with efforts to establish clear oversight. Bank of Thailand Sandbox Stablecoins used as a medium of payment, particularly those pegged to the Thai baht (THB) for public use, are considered as mirroring fiat currency, which violates the Currency Act B.E. 2501 (1958). These can also be classified as e-money under the Payment Systems Act B.E. 2560 (2017). The Bank of Thailand (BOT) urges issuers to engage in preconsultation prior to implementation, due to concerns about stablecoins being used in place of THB currency. Other FX- or asset-backed stablecoins are not recognized as legal tender under Thai law, and users must bear their own risks. The BOT recognizes the potential and benefits of these technologies in reducing operational costs for financial service providers and addressing the needs of financial service users. Consequently, the BOT issued a sandbox framework in June 2024. In particular, the enhanced regulatory sandbox allows nonlicensed entities to test financial innovations in controlled conditions. These tests must have a clearly defined duration (usually under one year) and involve a limited user group with an exit strategy. Several programmable payment projects—automated transactions with predefined conditions for the payment of goods and services—were piloted under this sandbox, which closed for applications in September 2024. Eight participants are planning to launch their test runs this year, some of which include asset tokenization or exchange global stablecoins in their programmable payment projects. Thai Securities and Exchange Commission Sandbox Given that digital asset businesses fall under the Royal Decree on Digital Asset Businesses B.E. 2561 (2018), supervised by
Read More