The concern section at the Ministry of Commerce will assist you in starting your business in Thailand. However, if you are a non-Thai and depending on your business aims, you may need to apply for a foreign business licence in Thailand to conduct business. Proper business licences allow you to operate in a specific sector or industry, as well as in a specific place.
Depending on your line of business, you may need to apply for multiple licences in order to run your company legally. Local government offices are usually in charge of business permits.
According to the regulations and conditions stated in Thailand’s Foreign Business Act, foreign investors can choose from a wide selection of corporate business forms and structures. Whether a corporation engages in trade or non-trading activities, the requirements set forth by Thailand’s Foreign Business Act determine who owns a portion of the company.
General business types for foreigners in Thailand are –
- Partnership business (ordinary or limited)
- Limited liability company
- Foreign Branch office/Regional office
- Representative office
Foreign investors can form a company with 100 per cent foreign ownership if they meet the Ministry of Commerce’s conditions.
Board of Investment for Foreign Business in Thailand
A business that has been certified by the Board of Investment can have up to 100 per cent foreign ownership, corporate tax incentives, merit-based incentives, and other exemptions that the Board of Investment has approved.
Additionally, if your business complies with the framework of the BCG Economy model of Thailand, you can be eligible for greater benefits under BOI.
Thailand-US Amity Treaty
The treaty allows American individuals and businesses incorporated or doing business in Thailand to own a majority shareholding or entirely own a company in Thailand, allowing them to do business as if they were Thai nationals. These firms are also exempt from the majority of the foreign investment limitations established by the Thai Foreign Business Act of 1999.
Foreign Business License in Thailand
You can apply to the ministry of commerce for 100 per cent ownership of your company based on your venture’s contribution to the economy in terms of technology and know-how transfer, local job creation, investment, and other direct and indirect economic contributions.
The issuance of such permits, however, is contingent on meeting the criteria and categorising commercial activities as outlined by the Foreign Business Act of 1999.
Export and Manufacturing Business in Thailand
A trading entity with a 100 per cent export registration or a manufacturing firm with a 100 per cent manufactured product registration is suitable for entirely foreign ownership.
The Factory Act of 1992 is the key set of regulations for setting up manufacturing businesses in Thailand. The act governs all activities related to the construction, operations and expansion of any manufacturing unit along with setting the safety standards. This article intends to explain the legal framework governing the operations and expansion of the manufacturing business in Thailand.
The Department of International Trade Promotion says exports in Thailand will gradually expand in 2021. The prediction is on the basis of the economic recuperation worldwide and also the availability of the Covid-19 vaccine.
The director-general Mr Somdet Susomboon added to this that the exports will be growing by 4% by 2021’s end and will be in tune with the projections made by other private sector and public agencies. This can be good news if you are planning for export business in Thailand.
Representative or Branch Office in Thailand
A foreign entity can apply to open a representative office or a branch office to conduct business under certain conditions. The scope of business can be on operations and revenue creation.
Although the Representative Office cannot be established for revenue generation purpose, it can be used to settle a 100% foreign-owned business in Thailand. A representative office in Thailand is not subjected to CIT as it usually doesn’t do any business transaction. You may know that the funding generally comes from the Head Office to cover the overhead costs.
Are you are planning to have an overseas presence of your company and that too in Thailand? Then the representative office is a wise decision.
What Makes Foreign Business Registration Easier in Thailand?
You may have thought it to be difficult earlier. But, the article must have shown your paths to make your business registration process in Thailand easier. To sum up, let us enumerate the methods for your better understanding:
- Try to set up a Representative or Branch office in Thailand to extend your local business to Thailand. This method has relatively lesser formalities involved.
- You must have Thai acquaintances or family relationship with Thai nationals. This will make your task much easier.
- Transform your business idea to comply with the BCG Economy model of Thailand. If you are successful in this, you can easily register your business in Thailand with BOI support.
- If you are from the United States of America, then it is already easy for you. All you need to know is about the Thai-US Treaty of Amity. Similar treaties are applicable for nations like Japan and Australia.
But the most important step is to get proper legal counsel in the process to register your business in Thailand. Law firms like Konrad Legal can assist you in the process. All you have to do is to write to us at officer@konradlegal.com. We are one of the premier full-service law firms in Thailand with a 99% international client retention rate.
