An overview of foreign investment in Thailand
According to many studies, foreigners predominantly choose their investment destinations that are emerging quickly like the Kingdom of Thailand. For years, Thailand has been among the best nations in Asia for pulling in Foreign Direct Investment (FDI) and many International organizations continue to rank Thailand as a lucrative investment destination. Also, the government plays a major and active role in promoting foreign investments in the form of incentives offered by the Board of Investment (BOI).
Brief information on Thailand BOI policy
The Act of Investment Promotion, B.E. 2520 (1977) has authorized the BOI to push domestic and foreign investments that are beneficial for the social and economic development of Thailand. After 15 years, Thailand has finally updated its investment policy which came into effect this year and will last until the end of 2021. It aims to reconstruct the Thai economy to a more focused form of investment promotion.
Why invest in Thailand? This is one place which provides expats with development prospects like market size, the overall efficiency of work, the accessibility, etc; and macro-environmental opportunities such as economic growth, low inflation rate, cheap labour, etc.
Which project to invest in? The most common investments for expats in Thailand are:
- Stock market
- Real estate (Even though foreigners living in Thailand are unable to own a land, but there are still exceptions to certain types of real estate’s.)
- Software development
- Digital services
- Food business
- Tourism services
Procedure for foreign investment:
- Choose a type of business venture
- Fill up the BOI application form and keep all required documents handy
- Contact the BOI officials within 10 days of application submission to make an appointment for project evaluation.
- Pay the fees
- Submit the company establishment documents within 6 months of approval.
Criteria for Project Approval:
- The value-added must be at least 20 percent of sales revenue
- Modern machinery should be used. If using old, it should be approved by the BOI.
- Obtain a certificate if your project has a capital investment of THB 10 million or above within two years from the start-up date.
What investment incentives can you get?
The incentive depends on the sort of business venture you decide on to line up in Thailand. The BOI provides special privileges to projects that are expected to be extremely helpful to the country. Hence, the BOI encourages projects with Activity-based and Merit-based incentives.
In the case any person violates or fails to comply with the conditions set forth by the BOI, then the BOI will have the right to withdraw the grants and incentives given to that person.
PS: Whether you want to purchase stocks or make investments in any other profitable project, you will require a little bit of local knowledge about the procedures. Hence, getting in touch with a Thai legal firm will be of a great help.
