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http://www.fightersonlymag.com/content/news/15911-thailand-government-bans-mma

(Haven't found any other sources for this though, just other forums reposting the same article)

I'm going with the article in that if this is true this seems to be motivated by other reasons rather than MMA being "too brutal" though surely MMA must be big business in Thailand? I'd imagine the gyms over there attract foreigners wanting to train Muay Thai for MMA.

"Everything has its beauty, but not everyone sees it." ~ Confucius

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The quote "mixed martial arts is “causing erosion” to the sport of Muay Thai " pretty much sums it up. This wouldn't prevent foreigners from training in the country to use it for MMA, but will protect Muay Thai from any sort of changes. Muay Thai is not only a big cultural thing, but a lot of money exchanges hands within the sport. People, and therefore governments, fear change...this is the easiest way to prevent it.

"A gun is a tool. Like a butcher knife or a harpoon, or uhh... an alligator."

― Homer, The Simpsons

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