BANGKOK, Thailand -- Foreign owners of companies in Thailand will probably find it more difficult doing business in the country following a decision by Thailand's military government to new rules that will restrict international investors to stakes of less than 50 percent in the nation's companies.
Thailand's Financial Minister Preidiyathorn Devakula said foreign companies that have circumvented limits on direct investments by acting through Thai nominees will have to reduce their stakes, Bloomberg.com reported.
The tighter rules affect investments in about 15 publicly traded companies, mostly in the telecommunications and property sectors.
According to Bloomberg.com, the new move is designed to eliminate foreign control of companies under so-called list one and two of the Alien Business Act which includes media, telecoms, mining, aviation and agriculture businesses.
Overseas investors have a year to disclose their holdings in Thai companies and an additional 12 months to reduce their stakes to less than 50 percent based on voting rights.
Story Continues Below
The Thai Commerce Ministry said the revised law will "not affect foreign businesses in the industrial sector, export and those under investment privileges."
The new rules are the latest announcement Devakula, the former central bank governor, has made since he was appointed financial minister in Oct. 2006. Last month he defended a series of currency controls he announced he said were imposed to save the country's export-dependent economy. With exporters complaining about the strengthening baht, Devakula said he had to do something to rein in speculators who he asserted were behind the surge and protect the Thai economy.
Thailand has been trying to boost confidence in its economy after a Sept. 19 coup.
© NewsMax 2007. All rights reserved.
Editor's note:
Correction In India's Markets Makes This A Great Time To Buy!
Discover Asia's Newest Tiger - Click Here Now
Chief Economist: India Is Best Investment In Asia
