Securities companies have been prohibited from buying, selling, or exchanging foreign currency directly with its clients as they were not permitted to hold foreign exchange licenses. This is despite the fact that securities companies can act as investment agents for Thai clients for making investment in foreign currency-denominated securities and derivatives ("FCY Products"). With the growing popularity of investment in foreign currency instruments, the Bank of Thailand (the "BOT") recently issued a new regulation which will allow securities companies to apply for foreign exchange licenses with a limited scope to buy, sell, or exchange foreign currency for its clients for investment in FCY Products (a "Limited FX License").
In this alert:
- Who is eligible for the Limited FX License?
- Scope of permissible FX businesses
- Consideration period
- What are the benefits to Thai investors?
- Post-licensing obligations?