Thailand approves electronic securities bill

The Thai Cabinet approved the draft Electronic Securities Bill to support the issuance of assets via digital platforms on June 10, aiming to facilitate the use of security tokens and bonds based on modern technologies.

This move is expected to help modernise the legal framework and promote the use of technology to make financial transactions more efficient and accessible for the public.

Pornanong Busaratrakul, Secretary-General of the Securities and Exchange Commission (SEC), revealed that this will lay the foundation for Thailand’s capital market to enter the digital era. The new bill will simplify the trading of securities, such as equity instruments, investment units, and debt instruments, making it easier for retail investors to buy and trade assets, and providing better protection for investors.

The bill will make the entire securities trading process electronic, from recording and transferring data to collateral management. This will replace the old script-based system and the traditional use of paper certificates with an electronic format that can be used as the official record, Pornanong said.

The SEC will also implement secondary regulations that will enable the issuance of electronic securities in place of physical certificates. These measures are expected to be in force by 2025 after approval by the Parliament.

Furthermore, the SEC is preparing secondary regulations to support electronic securities, ensuring that digital assets replace traditional paper documents. They are collaborating with relevant agencies to set transaction standards and build infrastructure to facilitate digital capital markets.

This initiative aims to allow seamless electronic transactions from the issuance and sale of securities to transfers and collateral management. The SEC sees the adoption of innovation and technology as a key factor in advancing Thailand’s capital markets, increasing efficiency and fostering competition and innovation in the financial sector.

These bills were sent to the Office of the Council of State for review, with a key focus on incorporating appropriate technologies for capital market transactions, enhancing regulatory clarity, and improving the effectiveness of legal enforcement.