Thailand's Draft Startup Act Could Expand Funding Options for Young Companies

Cabinet approval starts the next legal stage

The September 8 decision approved the bill in principle and sent it onward for legal review by the Office of the Council of State. The Cabinet also instructed the Department of Business Development to prepare changes to company-law provisions and related legislation so they can accommodate newer fundraising and ownership structures.

That procedural status matters for anyone structuring a Thai startup today. Cabinet backing gives the proposal political and administrative momentum, but it does not itself activate the fundraising tools described in the draft. Eligibility rules and technical details can still be revised as the bill moves through the legal and legislative process.

**The draft targets a defined group of startups**

Government materials describe the proposed regime as optional rather than a replacement for the rules applying to every company. Among the draft criteria are being a limited company established for no more than 10 years, having average revenue of no more than THB 300 million over the previous three years, never having paid a dividend, and not being controlled by another company. Qualifying businesses would be able to self-certify electronically with Thailand's National Innovation Agency.

The proposal would provide a five-year window of rights and benefits for admitted startups. The tools listed by the government include public share offerings and debentures, debt-to-equity conversions, conversion of preferred shares into ordinary shares, vesting arrangements, and holding treasury shares for allocation under employee or investment arrangements. NIA has also said that qualifying deep-tech businesses could potentially receive an extension taking the support period to as long as 10 years.

For practical context, see Thailand economy and finance. This development also connects with Thailand backs e-Tax incentives through 2027, drafts pending.

Existing deals still have to follow current law

For founders and investors, the draft is most useful today as an indication of where Thailand may loosen constraints around private-company financing. It may affect how parties think about future convertible instruments, employee equity and later fundraising rounds, particularly when a transaction is expected to close after the legislative process advances.

It is too early, however, to draft or execute a transaction on the assumption that the proposed regime is already available. Agreements signed now remain subject to the law currently in force. Where a deal depends on one of the draft's new mechanisms, the practical approach is to identify that dependency explicitly rather than treating future legislation as a completed legal change.