Starting a business in Thailand usually requires a law firm who understands corporate law in Thailand. You need to understand how to register a Thai company and what the options are. The reason being that you are not allowed as a foreigner to own your company 100%. Registering a company in Thailand can take the form of many types of businesses. You could either register a Limited Company, Partnership or a representative office.
The Foreign Business Act has been changed a few times over the last few years and they have been closing many of the loopholes. There have been objections to the limitations and these can be best summed up as follows:
- The draft proposes to extend the definition of alien (foreign individuals or companies) as being that any company where foreigners hold half or a majority of the voting rights would be classified as alien and thereby restricted from participation in businesses regulated under the Foreign Business Act.
- limited grandfathering is included. All foreign owned companies as under the new definition and that have been operating for a year have to apply to the Ministry of Commerce for a certificate with a year. Once the certificate has been issued they have to adjust their shareholding or voting profile to conform to the new definition of the act within 3 years. This would exclude most service businesses.
- 100% foreign ownership was allowed for retail and wholesale businesses under the Foreign Business Act with the condition that 100 million Baht capital was fully paid or 20 million Baht per shop. That has now been abolished under the new Foreign Business Act.
If you are considering registering a Thai company speak to one of our attorneys at any of our branches. Getting the latest changes to foreign ownership laws is important even to you if you are considering buying a condo or house in the name of a Thai company.