Thailand’s Securities and Exchange Commission (SEC) has updated its regulations regarding public initial coin offerings (ICOs) that exhibit debt-like or infrastructure-backed characteristics. These new regulations are set to transform the landscape for digital fundraising, ensuring enhanced investor protection and risk mitigation. The introduction of these regulations is a major move toward cultivating a more transparent and secure digital token market in Thailand. It highlights the importance of comprehensive information disclosure and aligning digital-asset fundraising practices with established financial standards. The adjustments require more collaboration between token issuers and ICO portals to comply with the developing regulatory environment. The key features of the new regulations, which took effect on November 16, 2023, are summarized below. Debt-Like ICOs Debt-like digital tokens are digital tokens for which a fixed rate of return is predetermined. The rate does not vary based on the performance of the project or enterprise, but it may be supplemented by extra returns. To ensure that investors have access to adequate and essential information prior to making informed investment decisions, and to evaluate the risk of default by the issuer, the regulation requires disclosure of the project’s creditworthiness and risk assessment factors, as detailed below. Project creditworthiness. Disclosures about project creditworthiness should include information about the credibility assessment of the project, which should be conducted reasonably by an ICO portal or an independent expert. Risk assessment factors. Disclosures should include information about the factors considered in the assessment of risks—particularly the financial capability to repay the investment project’s debt. Infrastructure-Backed ICOs Infrastructure-backed digital tokens are issued for investment in infrastructure assets or to earn a share of the revenue stream from infrastructure projects. The regulations for the ICOs of these infrastructure-backed tokens have been revised to align with those for infrastructure trusts. These regulatory updates cover various aspects: Definition

Thailand’s Ministry of Industry (MOI) has issued a notification adopting the polluter-pays principle for generators of industrial waste in factories. The Notification of the Ministry of Industry on Management of Waste or Unused Materials B.E. 2566 (2023), enacted under the Factory Act B.E. 2535 (1992), marks a pivotal shift in the responsibilities and liabilities of factory operators as waste generators, which under the new notification no longer end when the waste is collected by a third-party waste processor. The notification, which was first issued in May 31, 2023, took effect on November 1, 2023, after the expiration of a grace period set by the MOI. The new MOI notification extends waste generators’ responsibilities and liabilities for management and disposal of waste from the time the waste is generated until it is properly and completely disposed of. These responsibilities include delivering the waste to the waste processor and overseeing the waste disposal processing, as well as undertaking proper measures in the event of failure by the waste processor, accident, or loss of the waste. Similar to the rules under the previous MOI notification on factory waste, the transport of waste outside the factory premises for disposal still requires permission from the Department of Industrial Works (DIW). However, the permission under the new MOI notification can now be applied for either electronically via its customer registration system (“i-Industry system”) or in person at the DIW. The MOI’s adoption of the polluter-pays principle for industrial waste heralds a significant shift in waste management liability and the costs of pollution prevention to the waste generators, who now need to ensure compliance with the rigorous criteria and compliance procedures outlined in the new MOI notification. For more details on the new rules, or on any aspect of Thailand’s waste management or environmental regulations for

On October 3, 2023, Thailand’s Board of Investment (BOI) issued a new regulation clarifying the eligibility criteria for investment promotion under the BOI category “5.10 Development of software, platforms for digital services, or digital content.” To be eligible for BOI promotion under the digital activity category, projects must meet criteria related to local development, minimum investment amount, machinery and equipment, and development processes. These criteria for category 5.10 activities, along with the latest clarifications from the BOI, are detailed in the table below. Tax Incentives The BOI also clarified the method for calculating corporate income tax (CIT) exemptions. The CIT cap amount is calculated on an annual basis from the prescribed expenses incurred after applying for BOI promotion and occurring during the year for which the CIT exemption is claimed. The allowances include 100% of expenses for salaries for newly hired Thai IT personnel, technology-related training, and obtaining quality standards (such as ISO 29110). The revenue of projects that qualify for CIT exemption must be from sales or services directly related to software, platforms for digital services, or digital content developed as promoted by the BOI, including licensing fees, subscription fees, pay-per-use expenses, in-app purchase fees, usage fees, revenue sharing, advertising fees, and so on. For more details on BOI promotion for digital activities, or on any aspect of investment promotion in Thailand, please contact Athistha (Nop) Chitranukroh at [email protected] or +66 2056 5600, Napassorn Lertussavavivat at [email protected] or +66 2056 5662, or Thammapas Chanpanich at [email protected] or +66 2056 5561.

Thailand has announced tax exemptions for issuers and holders of depositary receipts (DRs) of listed foreign securities to encourage DR transactions, create more investment products in the Thai capital markets, and promote and offer opportunities for retail investors to invest in foreign securities. The exemptions are laid out in the Royal Decree under the Revenue Code B.E. 2481 (No. 775) B.E. 2566 (Royal Decree No. 775), which came into force on August 16, 2023. DRs are certificates representing underlying foreign securities listed on a foreign exchange, but DRs are listed and traded on the Stock Exchange of Thailand (SET). Holders of a DR can receive the same benefits payable from the underlying listed foreign securities as direct holders of the listed foreign securities. According to the relevant notifications from Thailand’s Securities and Exchange Commission (SEC), DRs include the following: Certificates that confer the right to receive financial benefits equivalent or in reference to the received financial benefit from certain underlying listed foreign securities held by the certificate’s issuer; Unitized instruments having the same terms and conditions for each unit and issued by a custodian for the purpose of representing the holder’s right to claim for the deposited underlying listed foreign securities subject to the deposit agreement, or other rights as described by the custodian in the instrument. Issuance of a DR is subject to similar approval and disclosure requirements as those the SEC sets for general securities issued in Thailand. The recently announced tax exemptions for DR issuers and holders—which also apply to fractional DRs (also called DRx)—are detailed below. Corporate Income Tax Exemption Under Royal Decree No. 775, companies or registered partnerships that issue a DR in accordance with the Securities and Exchange Act B.E. 2535 (1992) (SEA) are exempt from paying corporate income tax (CIT) for income