Thailand will soon allow freer foreign investment in four businesses: commercial banks, representative offices of foreign banks, life insurance and non-life insurance.
The draft ministerial regulations have been vetted by the Council of State and will go to the cabinet for approval, said Pongpun Gearaviriyapun, director-general of the Business Development Department.
Once the regulations are officially published in the Royal Gazette, foreign investors in those four segments will no longer have to ask for a foreign business licence from the department.
The draft regulations come after the cabinet agreed in principle last May that the four business types should be removed from the annexes for List 3 of the Foreign Business Act (FBA).
List 3 is a group of businesses in which Thais are deemed not ready to compete with foreigners. Foreigners seeking to engage in List 3 activities are required to apply for and obtain a foreign business licence before beginning operations.
Mr Pongpun said removing the four categories from the annexes for List 3 would help promote competition, particularly in commercial banking and insurance services, and support investment in the country.
Innovative products and services are expected to be launched once the two businesses are thrown open to foreign investment, he said.
In November 2014, reports circulated of possible changes to the FBA, raising alarm bells among foreign chambers of commerce and embassies.
The proposed revisions would have redefined the term "foreign" and affected voting rights as well as the proportion of shareholdings, capital and management control.
The FBA currently stipulates that Thai nationals must hold more than 50% of the shares in a joint venture for it to qualify as a local company. Foreigners are allowed to form the majority on the board of directors.
Speculation over the revisions was given credence when Mitsugu Saito, a Japanese ministerial official, voiced concern that the amendment would affect 99% of Japanese companies in the service sector here.
The foreign community drew a parallel with the previous military government's capital control measures.
The Commerce Ministry afterwards assured foreign investors that amendments to the FBA would only involve investment promotion, simplifying business procedures and facilitating trade and investment.
It also insisted that any amendments would have no impact on existing businesses.
Prime Minister Prayut Chan-o-cha eventually appeared to end all speculation, saying in December 2014 that the government had shelved plans to amend the FBA.