Foreign investors are welcome in Thailand. In fact, the Thai government is continuously encouraging foreign investment in the country by offering some incentives to those who qualify to operate a business in Thailand under specific terms.
For many foreigners who have no background in Thailand laws and regulations, they need to do some research on the available business registration options in order to fully understand what a specific company type entails in terms of registration, benefits, etc. The best is to consult with business lawyers based in Thailand so all the details may be explained in full. Without the background knowledge, it will be normal to hear foreigners say that foreign business registration in Thailand is apparently difficult. The foreign company will have to be registered with the Department of Business Development in Thailand.
However, with the proper guidance and advice, a foreign investor can successfully register a company according to the type of company desired or suitable for the business. There are four types of companies a foreign investor can choose from:
This is the most popular type of Thai company preferred by most foreign investors. In this type, the liability of the investor is limited to the amount of unpaid shares subscribed by them. This type requires a minimum of three promoters who will file a memorandum of association, convene a statutory meeting and register a company. After registering the company, a tax identity card will be obtained by application.
Sole Proprietorships
Not usually recommended for foreign investors, sole proprietorship will get the sole owner exposed to unlimited liability of the business.
Partnerships
Similar to sole proprietorships, a partnership is not usually recommended to foreign investors due to the liability exposure, same as in sole proprietorships.
Branch Office
Foreign investors may opt to operate their existing foreign company in Thailand as a Branch Office. Another option is to set up a representative office, but this type does not allow the representative office to earn income in Thailand.
The Thailand Foreign Business Act BE2542 (1999) stipulates the conditions to be satisfied by the foreign investor in order to be able to register a company and operate a business in Thailand. Provisions of the Thailand Foreign Business Act spell out the criteria to meet to qualify as a foreigner, the type of business allowed by the Thai law to be operated by foreign investors, etc. and they clearly define what type of business are disallowed for foreign companies to engage in.
Coordinating with Thai lawyers or even foreign lawyers who have been practicing in Thailand and is well-versed with Thai law and its language will help foreign investors ease up the process of business registration. Looking for qualified lawyers in Thailand is easy as long as the investor know the prerequisites of business registration and the qualifications of the lawyer or law firm that will assist their company.
