Thailand Tightens Oversight on Direct Sales and Direct Marketing

Thailand’s Office of the Consumer Protection Board (OCPB) has initiated a comprehensive regulatory review of licensed direct sales and direct marketing businesses. As part of this process, business operators are being notified to submit their annual business report and audited financial statement to the OCPB, in line with their post-licensing obligations. This marks a significant escalation in the government’s efforts to enforce compliance and transparency in a sector that has faced increasing scrutiny in recent years.

Key Regulatory Considerations

All businesses holding a direct sales or direct marketing licence must submit their audited financial statement together with their business operations report to the OCPB within 60 days of the end of their fiscal year. This deadline may be extended by up to 30 days upon request, if necessary.

The OCPB is also conducting licence audits as part of its enforcement role. The office has set a target of completing audits for at least 90% of the 2,983 businesses licensed since 2022. These reviews include an assessment of the licensee’s business conduct.

New licence applications are likewise under closer scrutiny. Applicants are now subject to background checks, and the OCPB has indicated that a more rigorous vetting process will be applied going forward.

Impact of Non-Compliance

Failure to comply with these reporting obligations may trigger escalating enforcement actions, including:

1. An official notice requiring rectification of non-compliance within a specified timeframe.

2. Revocation of business registration if the operator fails to respond.

Where registration is revoked, the business will be prohibited from reapplying for a direct sales or direct marketing licence for five years.

The OCPB has already begun outreach efforts, including SMS and email notifications, as well as hosting seminars to raise awareness of these obligations. These measures form part of a broader initiative to enhance transparency and build consumer trust in the sector.

Action Points for Businesses

Operators in the direct sales and marketing sector should act promptly to:

• Ensure the timely submission of financial reports in accordance with the Direct Sales and Direct Marketing Act and OCPB directives.

• Review internal compliance frameworks to ensure alignment with the Act and relevant consumer protection laws.

• Prepare for potential audits and maintain clear, accessible documentation of business activities.

By Tilleke & Gibbins, Thailand, a Transatlantic Law International affiliated firm. 

For further information or for any assistance please contact thailand@transatlanticlaw.com

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