The amendment to the regulations related to the provision of NVDR transaction services by securities companies aims to enhance clarity and serve the original intent of the introduction of NVDR to support foreign investors’ participation in the Thai capital market without being subject to the foreign limit. The amendment also aims to prevent the misuse of NVDR securities as a tool for evading compliance with relevant regulations such as the compulsory reporting on acquisition and disposition of securities, or for concealing shareholding information, which could lead to inappropriate behaviors in the capital market or a lack of information that may affect investment decision making of investors. The key points of the amendment are as summarized below:   

(1) Prohibiting local securities companies from accepting orders of purchase, transfer or exchange of securities that would result in Thai investors gaining more possessions of NVDR unless in the case where the rights arise from holding NVDR securities before the amendment becomes effective or in the case of transfers in accordance with the law;     

(2) Requiring local securities companies to notify their clients who are foreign securities companies, foreign custodians or service providers to other entities of the service limitations under (1) and requiring such clients to disclose the true identity of all beneficiaries involved in NVDR transactions who are of Thai nationality. In this regard, the local securities companies are required to submit a report to the SEC at the end of each month and upon the closing of the shareholders register.    

The notification related to the amended regulations* has been published in the Government Gazette and has become effective as from 1 April 2024.

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Remark: 

* Notification of the Capital Market Supervisory Board No. Tor Thor. 8/2567 Re: Standard Conduct of Business, Management Arrangement, Operating Systems, and Providing Services to Clients of Securities Companies and Derivatives Intermediaries (No. 17), dated 21 March 2024: (https://publish.sec.or.th/nrs/10159s.pdf).