According to the Securities and Exchange Commission ("SEC"), Thai individuals will be allowed to invest abroad directly starting from September 2007. Currently, the Bank of Thailand allows only mutual funds, provident funds and proprietary portfolios of securities and asset management companies to invest abroad.

Full Update

The SEC will provide more flexibility for offshore investments by domestic investors. We discuss below who will be allowed to invest abroad directly, the level of overseas investment allowed under the new rules, and what kind of listing and trading of foreign securities will be allowed in Thailand.

Retail Investors

Retail investors are individuals who purchase small amounts of securities for themselves. They will be allowed to invest a quota of up to US$5 million abroad in overseas stock markets. However, investments in securities listed on regulated exchanges must be made through authorised securities brokers.

Institutional Investors

Institutional investors are entities with large amounts to invest, such as investment companies, mutual funds, brokerages, insurance companies, pension funds, investment banks and endowment funds. They will be allowed to invest a quota of up to US$50 million only when offshore investments are made through authorised securities brokers or purchased from authorised securities dealers.

Authorised securities business operators shall report their clients' offshore portfolios in compliance with the Bank of Thailand's rules and regulations.

Foreign currency-based offshore securities shall be solicited exclusively to local institutional investors and private funds through securities business licensees in compliance with the SEC's securities issuance regulations.

The SEC will allow listing and trading of foreign securities in local currency in the following two forms:

Transferable Custody Receipts

Transferable Custody Receipts ("TCRs") are issued by financial institutions, which will raise funds from individuals to invest in foreign securities. Each TCR will be listed on the Stock Exchange of Thailand ("SET"), to accommodate trading liquidity. TCRs of such products as leading foreign stocks and those of Exchange Traded Funds ("ETFs)", which are open-ended mutual funds that can be traded anytime during the day, will be allowed for listing and trading.

Foreign companies' stocks listed on the SET

Foreign companies' stocks listed on the SET, the rules and conditions for which are still under the SEC's consideration.  

By allowing these two forms, the SEC will increase product diversification on the SET and business opportunities for local securities firms.


These new criteria mean more alternatives for private funds as well as for institutional and retail investors to invest abroad with the benefit of professional services and advice. Likewise, asset management and securities companies will be able to make the most of diverse business opportunities.

For further information, please contact:

Name: Iain G.O. Melville
Phone: +662 677 7555
Fax: +662 677 7599

Name: Sathaporn Jumsuk
Phone: +662 677 7555
Fax: +662 677 7599

Name: Carolin A. Rost
Phone: +662 677 7555
Fax: +662 677 7599