Five Illegal Phuket Hotels Raided and Named Over License Breaches and Nominee Ownership Crackdown by Deputy Interior Minister

Thailand Hotel News: A major enforcement operation led by Thailand’s Deputy Minister of Interior has resulted in the raid of five illegal hotels across Phuket, with investigators now widening their probe into suspected nominee ownership arrangements involving foreign investors. The coordinated crackdown targeted unlicensed accommodation businesses operating in Phuket Town, Kathu and Thalang, reinforcing the government’s commitment to protecting legitimate hotel operators and maintaining fair competition in one of Thailand’s most important tourism destinations.

Acting on the instructions of Prime Minister and Interior Minister Anutin Charnvirakul, Deputy Minister of Interior Polpeera Suwannachawi, who also heads the Special Task Force for Social Order Enforcement, led the July 23 operation alongside Phuket Governor Chotinrin Kerdsum, officials from the Department of Provincial Administration, the Investigation and Legal Affairs Office, and district administrative officers. This Thailand Hotel News report understands that the operation formed part of a broader nationwide effort to eliminate illegal hotel businesses while investigating suspected violations of Thailand’s foreign ownership laws.

Five Hotels Found Operating Without Licences

The enforcement team inspected five hotels, all of which were found to be operating without the hotel licences required under Thailand’s Hotel Act B.E. 2547 (2004). Authorities immediately arrested the managers or operators responsible for each property and initiated legal proceedings.

Among the hotels inspected was The Proud Karon Beach Phuket Trademark Wyndham, a 157-room property located in Phuket Town. Investigators allege the hotel was operating without a license and are examining its ownership structure after discovering that approximately 49 percent of the shares were held by Russian interests while 51 percent were held by Thai shareholders. Authorities are investigating whether the arrangement may constitute the illegal use of Thai nominees to conceal foreign control.

The second property, Phuket Moonlit Bay Seaview Resort & Spa or Phuket Moonlit Patong Bay Hideaway Hotel, a 45-room hotel in Phuket Town, was also found to be operating without the required license. Initial investigations revealed that the company is owned by two Thai shareholders holding a combined 74 percent stake, while a Chinese shareholder controls the remaining 26 percent. Officials have confirmed that further investigations into the company’s ownership and business activities are continuing.

Authorities also raided Charm Resort Phuket, a 246-room hotel in Kathu District. Although all registered shareholders are Thai nationals, investigators found that the property had been operating without the legally required hotel license.

The operation also extended to Citygate Kamala Resort, a 374-room property in Kathu District, where officials found another unlicensed hotel business operating in breach of Thai law.

The fifth establishment, The Wood Terrace, a 20-room property in Thalang District, was likewise discovered to be operating without a hotel license, completing the sweep of five illegal hotel businesses across Phuket.

Managers Arrested and Evidence Seized

Following the inspections, managers and operators of all five hotels were arrested and charged with operating hotel businesses without licenses in violation of the Hotel Act B.E. 2547 (2004). Investigators also seized company documents, business records and other materials as evidence to support criminal proceedings.

Under Thai law, anyone convicted of operating a hotel without a license faces imprisonment of up to one year, a fine of up to 20,000 baht, or both. In addition, offenders may be ordered to pay daily fines of up to 10,000 baht for every day the illegal operation continues.

Officials said the enforcement action was designed to ensure fairness for legally licensed hotel operators who comply with Thailand’s regulatory requirements, while preventing illegal businesses from gaining an unfair commercial advantage.

Nominee Ownership Investigation Expands

Authorities confirmed that the operation is now moving beyond licensing violations as investigators examine whether some of the businesses may have breached Thailand’s foreign ownership regulations through nominee shareholding structures.

Investigators are scrutinizing shareholder records, financial transactions, company structures and related business activities to determine whether additional offences have been committed. The inquiry is being conducted in cooperation with several government agencies responsible for corporate regulation, financial oversight and law enforcement.

Officials have indicated that further legal action may follow if evidence emerges linking the hotels or associated companies to other violations of Thai law.

Tougher Enforcement Across Phuket’s Tourism Industry

The latest operation demonstrates the government’s increasingly firm approach towards enforcing hotel licensing regulations and investigating suspected nominee ownership in Thailand’s tourism sector. Phuket remains one of the country’s premier tourism destinations, making regulatory compliance particularly important for maintaining investor confidence, visitor safety and fair competition within the hospitality industry.

Authorities stressed that businesses operating legally should not be placed at a competitive disadvantage by operators who ignore licensing requirements or attempt to circumvent foreign ownership restrictions. The crackdown also serves as a warning that enforcement efforts are expected to continue across key tourism provinces as officials work to eliminate illegal accommodation businesses and strengthen confidence in Thailand’s hotel sector.

Readers should be aware that the raid and checks are ongoing and with a lot more properties being discovered each day.

For the latest developments in the hotel industry in Phuket, keep on logging to Thailand Hotel News.