Setting up a Company in Thailand
Setting up a Company in Thailand is not that difficult but you will need an experienced lawyer who specializes on this field and has an experience assisting a foreign investor to give you the right advice. Establishing a company for a Thai Citizen and a foreigner is totally different, it varies in processes and requirements such as you may need to obtain visa and work permit, the number of shareholders or some business may need specific license for the foreigner. There’s quite an obstacle for Foreign investors in Thailand as the Kingdom does not easily give permission and allow foreigners to build their empire here in Thailand. Although a foreigner can only hold 49% of the company’s total shares (Not unless a U.S. Citizen), a lot are still considering on setting up a company here in Thailand.
In this matter, we are recognized as one the leading law firms that provides solution and advice on company establishment and other corporate transactions as we are able to combine exceptional transaction skills with specialist expert in antitrust, employment, benefits, environmental, intellectual property, visa, work permit and tax. This enables us to handle the numerous issues that can arise in a single corporate transaction. We have an exceptional track record in every sector and particular strengths in highly regulated industries.
Table of Contents
In order for you to establish and set up your company in Thailand successfully here are some of important reminders you should consider:1. What you should consider before you set up a company in Thailand? 2. Proprietorship. 3. Types of Partnership in Thailand. 4. Joint Venture. 5. Limited Company. 6. Register a Company. 7. Siam Attorney can help you with Setting Up your Company in Thailand.
1. What you should consider before you set up company in Thailand?
I. Choose your business structure.
Before you register your business in Thailand, it’s important to consider which company structure will best suit your needs. There are several different options:
- Sole proprietorship
- Partnership (unregistered, registered or limited)
- Company (public or limited)
- Joint venture
- Sole proprietorship
The sole proprietorship is a registered business owned by one person, who is also the operator of the business. In Thailand there are some professions in which a sole proprietor is prohibited from working, specifically in banking and finance. By law only limited companies can do this type of work.
Whether or not you’re able to set up this sole trader business structure in Thailand will also depend on your nationality. A US citizen, for example, is able to set up a sole proprietorship business because of the Treaty of Amity between Thailand and America. Other nationalities may find some business areas restricted to them.
3. Types of partnerships in Thailand:
– Unregistered ordinary partnerships whereas all partners are jointly and wholly liable for all debts of the partnership
- Registered ordinary partnerships whereas the partnership becomes a legal entity and its legal personality is separated and distinct from the individual partners
- Limited partnerships whereas the liability of each individual partner is restricted to the amount of capital invested to the partnership.
a) Unregistered Ordinary Partnership
With this partnership, all partners will be jointly liable for all obligations of the partnership. Also, the Unregistered Ordinary Partnership isn’t considered a legal entity. The partners are still held accountable for any mishaps.
b) Registered Ordinary Partnership
This kind of partnership requires registration with the authorities. With Registered Ordinary Partnerships, the business has legal rights, duties, and liabilities separate from all partners.
c) Limited Partnership
This kind of partnership has two types of partners: Unlimited Liability Partners and Limited Liability Partners. The Limited Liability Partners will be liable only to the amount of capital that the said partners contributed to the partnership. The Unlimited Liability Partners will be liable no matter how much capital the partners contributed to the partnership.
Even though registering partnerships is easier than registering other business structures, the partnerships, whether Unregistered, Registered, or Limited Ordinary Partnerships, can’t give work permits to foreigners. The also can’t open corporate bank accounts under the company’s name.
4. Joint Venture
A joint venture refers to a group of persons entering into an agreement in order to carry on a business together. Although it has not yet been recognized as a legal entity under the Civil and Commercial Code, income from this business structure is subject to corporate taxation.
5. Limited company
There are two types of limited companies – private or closely held companies, and public companies. The first is governed by the Civil and Commercial Code, the second by the Public Company Act.
A private limited company is formed by registering a Memorandum of Association (Articles of Incorporation) and Articles of Association (By-laws), as its constitutive documents. Shareholders enjoy limited liability, i.e., limited to the remaining unpaid amount, if any, of the par values of their shares. A minimum of seven shareholders is required at all times. A private limited company may be wholly owned by aliens. However, in those activities reserved for Thai nationals, aliens’ participation is generally allowed up to a maximum of 49 percent.
Public Limited Companies registered in Thailand can offer shares, debentures and warrants to the public and may apply to have their securities listed on the Stock Exchange of Thailand (SET). The board of a public limited company must have a minimum of five members, at least half of Them are Thai nationals. Shares must have a face value of at least five baht each and be fully paid up.
(1) What is your business objective?
Because some businesses may be entitled to apply privileges from BOI and this will give you a lot of benefit such as 100% of the share can be owned by a foreigner and the privilege to apply for visa and work permit without 4 Thai employees restriction, etc.
You can check if your business is entitled for the Board of Investment privilege by clicking to this link: Board of Investment (BOI).
(2) What is the company “registered capital”?
In case you obtain Visa and Work Permit, our government requires 2million THB registered capital per one foreign staff (including the director or owner).
(3) Does this business require specific license after set up company or not?
Some businesses need to obtain specific license after you set up the company such as tourist/travel business, hotel business, restaurant and bar business etc. but do not worry because here at Siam Attorney, we make sure that we will establish your business hassle-free.
6. Register a Company
Companies in Thailand have to be registered with the Department of Business Development, Ministry of Commerce.
Registering a company takes around seven days for a private company and up to 30 days for a public company. The first step is to select and reserve a company name, which is then valid for 30 days.
- Some of the documents needed include:
- Articles of Association
- Memorandum of Association
- Application form and list of shareholders
- New director form signed by each director
- Declaration of Business Operation form
- Company name reservation
- Details of the offices and branches of your business
Before you can register your business, you’ll also have to pay at least 25 per cent of the initial investment capital into a corporate bank account.
7. Siam Attorney can help you with Setting Up your Company in Thailand.
Siam Attorney can professional advice and we boast an enviable geographic footprint. Our corporate team spans all of our offices and works seamlessly with a global community of relationship with law firms giving us access to many countries. This platform provides our clients with the confidence that they will receive the highest quality of advice in both their domestic markets as well as when they expand into new territories.
Here’s what we can do for you:
- Set up the company
- Provide legalized documents
- Translating all legal documents and business related documents
- Process the non-immigrant visa and work permit for foreign employees (if any)
- Accounting services
For any question or advice regarding doing business in Thailand you can call us through Tel: +66 (0) 2-258-1763 or Mobile: +66 (0) 95-750-0888 or email us via email@example.com.
We will answer you with the best approach on how to start business in Thailand and maximize your benefit.
Here at Siam Attorney we value a strong teamwork and efficient working practices as well as uniform approach that enables us to manage cross-border deals effectively.