Thailand Regulator to Modify Royal Decree to Facilitate Digital Assets’ Growth
The Securities and Exchange Commission (SEC) of Thailand is planning to amend the royal decree on businesses related to digital assets next year. This move is aimed to facilitate the growth of cryptocurrencies but at the same time protect investors from risk, reported Bangkok Post on Nov. 25th. Ruenvadee Suwanmongkol, secretary-general of the SEC said,
“The regulator must be flexible to apply the rules and regulations in line with the market environment,”
“For example, laws should not be outdated and should serve market needs, especially for new digital asset products, and be competitive with the global market. We need to explore any possible obstacles.”
This royal decree took effect on May 14, 2018, and listed four types of businesses; ICOs, dealers, brokerage firms, and crypto exchanges. The ICO portals must be approved by the SEC while brokers, dealers, and exchanges are required to apply for a license from the Finance Ministry.
At that time Rapee Sucharitakul, the former SEC secretary-general said the legislation aims to protect investors from the risk of fraud, deception, money laundering, and exploitation of crypto assets for illegal financial transactions.
Companies have Already Started Applying for License
Five companies have already been awarded the cryptocurrency exchange licenses, as per SEC data. Out of these companies, Bitcoin Co shut down its operation in August while Bitkub Online Co Ltd and Satang Pro Corporation are currently operating. Huobi Thailand and Bitherb have yet to start operations.
Three of the digital asset brokers have obtained authorized licenses with two yet to be launched. Coin TH Co Ltd meanwhile is the only digital asset dealer to win SEC approval.
As for the companies that list ICOs, Longroot Thailand Co Ltd, T-BOX Thailand Co, and SE Digital Company Ltd. are three companies that got approved by the SEC.
According to the royal decree, those setting up unauthorized operations to solicit crypto investment and sellers of unauthorized digital currencies will be fined twice the value of the digital transactions or at least 500,000 baht. They could also face a jail term of up to two years.
Investors making cryptocurrency-related transactions are liable for a 7% value-added tax (VAT) payment along with a 15% withholding tax on capital gains and return on such investments.
However, retail investors trading digital assets on exchanges through exchanges are exempt from the VAT. In the case of no capital gains, investors will be required to only pay VAT.