If you want to build your business presence in Thailand, the easiest and most economical way is to set up a representative office in Thailand. But the major constraint is that you can not carry out any commercial activities through a representative office. For that, you can set up a Branch Office in Thailand.
This is one of the preferred business structures for foreign business owners in Thailand. It needs relatively lesser investment and timeframe in the registration process than a Thai Limited Company, Go through this FAQ article to get an idea of how this form of business can be useful for your venture in Thailand.
Can foreigners establish a branch office in Thailand?
Yes, foreign companies can establish their branch, officially in Thailand. The branch office is considered an extension of the parent company and is subject to Thai laws and regulations.
What are the requirements for setting up a branch office?
The requirements may vary depending on the specific circumstances, but generally, you will need to provide the following documents:
- Certified copy of the parent company’s incorporation documents
- Certified copy of the parent company’s financial statements
- Letter of appointment for the authorized director(s) of the branch office
- Power of attorney empowering the authorized director(s) to act on behalf of the parent company
Do I need a Thai partner or shareholder?
No, you do not need a Thai partner or shareholder to establish a branch office in Thailand. However, the branch office must appoint at least one authorized director who is ordinarily a resident of Thailand.
What is the minimum capital requirement?
Unlike a Thai company limited by shares, there is no specific minimum capital requirement for an official branch. However, you should ensure that the branch office has sufficient funds to cover its operations and activities in Thailand.
Can a branch office conduct business activities in Thailand?
Yes, a branch office can conduct business activities in Thailand, but it is limited to the scope of the parent company’s business. The activities must be related to and in support of the parent company’s operations.
Are there any tax obligations for such a business entity?
Yes, a branch office is subject to Thai corporate income tax on its net profits. The current corporate income tax rate in Thailand is 20%. The branch office may also be subject to other taxes, such as value-added tax (VAT) and withholding tax, depending on its activities.
Can a branch office hire employees?
Yes, a branch office can hire employees. However, it must comply with Thai labor laws and regulations, including registering with the Social Security Office in Thailand and providing mandatory benefits to employees.
How long does it take in the process?
The timeframe for setting up a branch office can vary, but it generally takes a few weeks to complete the registration process and obtain all the necessary approvals and permits.
Please note that the FAQs in this article can perfectly address the general requirements of setting up a branch office in Thailand. In case, your business perspective is different, you must consult a reliable corporate law firm in Thailand. Simply email us your requirements at [email protected] and get your branch office registered in Thailand within a few weeks!
