For decades, paper share certificates have served as the primary legal evidence of ownership in companies. Although most modern securities markets already rely on electronic records for trading and settlement, the legal framework in many jurisdictions still requires paper documentation at certain stages of issuance and corporate administration.

‍

Thailand is now taking a decisive step toward changing this model. In June 2026, the House of Representatives approved in principle amendments to the Securities and Exchange Act that would introduce a legal framework for digital securities traditional securities issued and existing entirely in electronic form. Unlike cryptocurrencies or security tokens, these instruments remain conventional securities regulated under Thailand's capital markets legislation, but without the need for physical certificates or paper-based recordkeeping.

‍

The proposed reform represents far more than a technological upgrade. By enabling fully digital issuance, transfer, pledge and settlement of securities, Thailand aims to modernize its capital market infrastructure, reduce administrative costs, improve access to capital, particularly for SMEs, and strengthen its position as one of Southeast Asia's leading financial centers.

‍

What has driven these reforms?

‍

The proposed reform forms part of Thailand's broader strategy to modernize its capital markets and align the country's legal framework with the realities of an increasingly digital financial ecosystem. Although most securities transactions are already processed electronically, the existing legal framework still retains certain paper-based requirements that increase administrative burdens and reduce operational efficiency throughout the securities lifecycle.

‍

According to the Securities and Exchange Commission of Thailand (SEC), the current framework creates unnecessary costs for issuers, intermediaries and other market participants, while limiting the further digitalization of Thailand's capital market. The proposed amendments are therefore intended to establish a comprehensive legal framework allowing securities to be issued, transferred, pledged and maintained entirely in electronic form.

‍

The reform is expected to simplify corporate and securities-related procedures, reduce administrative costs, accelerate market transactions and enhance overall market efficiency. More importantly, it represents a strategic step toward developing a modern digital capital market infrastructure capable of supporting innovation, improving access to capital, particularly for small and medium-sized enterprises, and strengthening Thailand's position as one of Southeast Asia's leading financial centers.

‍

The digital securities bill: what exactly is Thailand proposing?

‍

The legal foundation of the reform is the Draft Act Amending the Securities and Exchange Act B.E. 2535 (1992), which the Thai Cabinet approved to modernize the country's securities legislation and establish a legal framework for issuing and circulating securities in digital form. The proposed amendments are intended to align Thailand's capital markets with technological developments while strengthening the legal infrastructure for digital financial services.

‍

On 10 June 2026, Thailand's House of Representatives approved the Bill in principle at its first reading and referred it to a parliamentary committee for detailed consideration. Before becoming law, the Bill must complete the remaining stages of the legislative process, including the second and third readings, approval by the Senate (where applicable under Thailand's legislative procedure), and Royal Assent. As of the date of writing, the Bill has not yet entered into force, and no official effective date has been announced. Accordingly, the proposed amendments remain subject to further legislative review.

‍

Despite this, the Bill already represents one of the most significant reforms of Thailand's capital markets legislation in recent years. Rather than introducing a new category of financial instruments, its primary objective is to digitalize the existing legal framework governing the issuance and circulation of traditional securities by modernizing the Securities and Exchange Act.

‍

The cornerstone of the reform is the introduction of a legal framework for Digital Securities, traditional securities that exist exclusively as electronic records. Under the proposed legislation, shares, debentures, investment units and other eligible securities may be issued directly in digital form without the need to create or maintain physical certificates. Ownership rights and all relevant information relating to such securities would be recorded and maintained through electronic systems operating in accordance with standards prescribed by the Securities and Exchange Commission of Thailand (SEC).

‍

Beyond digital issuance, the Bill also establishes a legal basis for the electronic lifecycle of securities. Registration of ownership, transfers of title, creation of pledges, and other legally significant transactions involving securities could be completed entirely through electronic systems without reliance on paper documentation. In practical terms, the proposed framework seeks to digitalize the entire lifecycle of a security from its issuance to its transfer, encumbrance and ongoing administration.

‍

Importantly, the Bill expressly clarifies that Digital Securities are not a new category of digital assets. They remain conventional securities regulated under the Securities and Exchange Act and continue to fall under the supervision of the SEC. The legal rights attached to these instruments, as well as the regulatory requirements applicable to them, remain unchanged. The reform affects only the legal form in which such securities are issued, held, and transferred, replacing paper certificates with legally recognized electronic records.

‍

In addition, the proposed amendments authorize the SEC to adopt subordinate regulations establishing the technical and operational requirements for the digital securities ecosystem. These implementing regulations are expected to govern matters such as electronic recordkeeping systems, infrastructure operators, operational standards, and other practical aspects necessary for the effective implementation of the new legal framework.

‍

Which securities are covered by the reform and how will their legal framework change?

‍

One of the key features of the proposed legislation is that it does not introduce a new category of financial instruments. Instead, it extends the possibility of digital issuance to securities that are already recognized under the Securities and Exchange Act B.E. 2535 (1992). According to the Securities and Exchange Commission of Thailand (SEC), these include shares, debt securities, investment units, as well as other types of securities governed by Thailand's capital markets legislation. Consequently, the reform is not limited to corporate shares but applies to a broad range of traditional financial instruments.

‍

At the same time, the Bill fundamentally changes how these securities are issued, recorded and transferred. Under the current legal framework, ownership rights are generally evidenced through paper-based certificates or other documentary procedures. The proposed amendments replace this approach by allowing such rights to exist exclusively as electronic records maintained within systems that comply with standards prescribed by the SEC. In other words, the legal nature of the security remains unchanged; only the form in which it exists is transformed from paper to digital.

‍

The proposed framework further enables the entire lifecycle of securities to be conducted electronically. In particular, electronic systems will support:

‍

• the issuance of securities;
• the recording and maintenance of ownership rights;
• the transfer of ownership;
• the creation and registration of pledges or other security interests over securities.

‍

As a result, the complete lifecycle of a security—from its issuance and subsequent transfer to its use as collateral—may be carried out digitally without the need for physical certificates or paper-based documentation. At the same time, all such securities will continue to be regulated under the Securities and Exchange Act, remain subject to the supervision of the SEC and be governed by the existing legal framework applicable to Thailand's capital markets.

‍

This represents one of the defining characteristics of the reform. Rather than establishing a separate regulatory regime for digital assets or creating a new class of investment instruments, the Bill modernizes the existing securities framework by replacing paper-based processes with legally recognized electronic records. The objective is to improve operational efficiency, reduce administrative costs, and modernize Thailand's capital market infrastructure while preserving the same legal rights, investor protections, and regulatory safeguards that currently apply to traditional securities.

‍

Conclusion

‍

For investors, the proposed reform primarily changes how their rights in securities are evidenced and exercised. Once the amendments take effect, ownership and other rights will be confirmed through electronic records maintained in accordance with the requirements of the Securities and Exchange Commission of Thailand (SEC), rather than through paper certificates or other document-based procedures. This will allow transfers of ownership, registration of pledges and other legally significant actions to be completed electronically.

‍

The reform does not change the substance of investors’ property or corporate rights. Holders of Digital Securities will retain the same rights as holders of securities in traditional form, including ownership rights, entitlement to income, participation in corporate governance where applicable, and other rights provided by law. The Bill changes the form in which these rights are recorded and transferred, not their legal nature.

‍

In practical terms, this may simplify investors’ participation in the capital market. The removal of paper certificates reduces the risks associated with their loss, damage or the need to complete physical documentation for individual transactions. Electronic record-keeping may also make it easier to verify ownership, transfer securities and use them as collateral.

‍

Accordingly, the Bill does not expand the scope of investors’ rights, but it may make those rights easier to exercise. If the reform is fully implemented, investors will be able to carry out the main legal actions involving traditional securities within a digital environment while remaining protected under Thailand’s existing securities legislation and SEC supervision.

‍

Connect with TUCC

‍

Stay updated with the latest market insights, legal guides, and networking opportunities within the Thai-Ukrainian business corridor.

‍

Website: thaiukraine.org

‍

Email: info@thaiukraine.org

‍

LinkedIn: Thai-Ukrainian Chamber of Commerce