In more detail
Key amendments prescribed in the notification are as follows:
1. Registration of information on Offshore FIs
From 2017, Thai Intermediaries can collaborate with Offshore FIs to offer offshore capital market products to investors based in Thailand and facilitate offshore investments ("Collaboration Scheme"). Under the previous regulations, there was no requirement for a Thai Intermediary to register the information of the Offshore FIs with the SEC, but only the information on the personnel of Offshore FIs ("Offshore Personnel") set out in Clause 2 below.
However, the new regulations now require a Thai Intermediary, who would like to invite Offshore Personnel to provide information or advice on Offshore Products to Thai clients, to register information of the Offshore FI with the SEC in advance, in addition to the information on the Offshore Personnel set out in Clause 2 below. This is a one-time requirement, unless the Offshore FI changes its name.
2. Registration of information on Offshore Personnel
Under the previous regulations, the Thai Intermediary was required to register information of the Offshore Personnel (e.g., the product specialist) who will provide information or advice on Offshore Products to Thai clients, per the Thai Intermediary's invitation, with the SEC at least one business day in advance, unless the Thai clients are qualified institutional investors.
According to the new amendments, this registration requirement will be relaxed so that the Thai Intermediary will only be required to register information of the Offshore Personnel with the SEC within seven business days from the date of provision of the information or advice on Offshore Products to Thai clients who are not qualified institutional investors, regardless of the method used for provision of such information or advice (e.g., physical meeting, online meeting, two-way communication, one-way communication). This registration must be conducted each time the provision of information or advice of the Offshore Products takes place.
The Thai Intermediary must ensure that the Offshore Personnel who will provide information or advice on Offshore Products to Thai clients possesses all required qualifications as prescribed by the SEC. For this purpose, the SEC encourages that there is a service agreement in place between the Thai Intermediary and the Offshore FI.
3. Relaxation of the maximum 90-day limit for Offshore Personnel
Under the previous regulations, the Thai Intermediary could invite each Offshore Personnel to provide information or advice on Offshore Products to Thai clients for up to 90 days per calendar year, unless the Thai clients are qualified institutional investors.
To support this Collaboration Scheme, the maximum limit of 90 days per calendar year has been repealed. Under the new regulations, the Thai Intermediary can now invite Offshore Personnel to provide information or advice on Offshore Products to Thai clients as deemed necessary, without a prescribed maximum limit per year.
Endnotes
Given that these amendments may impact Thai Intermediaries and Offshore FIs offering Offshore Products under the Collaboration Scheme, it is worthwhile to look out for the new changes.
For more details, please contact our team at Baker McKenzie.
1 The local licensed intermediary must hold securities brokerage, dealing and/or underwriting license, or derivatives brokerage and/or dealing license under Thai law, as applicable.
2 The Notification of the Capital Market Supervisory Board No. TorThor. 41/2566 re: Provision of Services to Clients regarding Investment in Capital Market Products Denominated in Foreign Currency is issued to further amend the Notification of the Capital Market Supervisory Board No. TorThor. 1/2560 Re: Provision of Services to Clients regarding Investment in Capital Market Products Denominated in Foreign Currency, as amended.
3 Offshore financial institution refers to (i) offshore securities issuer or offerer; and (ii) offshore securities or derivatives business operator, as applicable.
