Thailand is rapidly growing to be a hub of global investors. Foreign Direct Investment in Thailand increased by 50409.04 THB Million in the third quarter of 2023. This indicates the tenacity of foreign investors in exploring business opportunities and going for their company registration in Thailand, which will continue in 2024 as well.
Are you one of such investors and planning to establish or expand your business empire in Thailand? Then this article will guide you throughout the process of company registration in Thailand in 2024 illuminating the crucial points of legal and statutory compliance.
What makes Thailand favorable for Foreign Investors in 2024?
For a long time, Thailand has been recognized as a desirable business destination because of its strategic location in Southeast Asia. It serves as a gateway to other markets in the region and has a well-connected transportation infrastructure.
In addition, the startup and tech industry in Thailand is booming, with large corporations establishing accelerators to drive growth in various sectors such as e-commerce, medical technology, and financial technology. The country also offers ease of doing business, a vibrant community of startups and digital businesses, and the necessary infrastructure for company growth.
Additionally, there are certain Board of Investment announcements made in 2023 that will surely make the process of company registration in Thailand easy for foreign investors in 2024. Click the image below the learn about them from our published article –
What should I consider when starting a company in Thailand?
Before launching a business in Thailand, it is essential to identify the most appropriate form of company for your undertaking.
Thai Limited Company
A Thai Limited Company is the most popular choice for international investors.
Under the Thai Civil and Commercial Code, companies can be 100% foreign-owned, depending on the type of business.
The Foreign Business Act (FBA) regulates foreign investment to safeguard Thai businesses. The FBA specifies which industries are open to foreign investment and what conditions they must follow.
For roughly 50 types of businesses, such as services and consulting, foreign companies cannot own more than 49.99% unless they obtain a Foreign Business License or a BOI promotion, which allows 100% foreign ownership.
Therefore, in these cases, they will need a Thai partner to hold the majority stake.
Board of Investment (BOI) Promotion
It is highly recommended to get a Board of Investment (BOI) certification when starting a company in Thailand. The primary purpose of the BOI, a government agency, is to attract foreign investment by providing unique advantages and benefits that are not available to regular businesses. These benefits include 100% foreign ownership, tax breaks, simplified visa procedures, and other perks.
A BOI certification can significantly speed up an entrepreneur’s entry into the Thai market and create a favorable climate for doing business. However, BOI certifications are only available for certain business activities.
Understanding Legal Requirements
Complying with the legal requirements is essential to starting a business in Thailand. Here are some key points to consider:
Foreign Business Act
Familiarize yourself with Thailand’s Foreign Business Act, which outlines activities foreign companies cannot conduct. The FBA restricts foreigners or foreign-owned companies from undertaking over 50 categories of business activities in Thailand.
For more information on the Foreign Business Act of Thailand, please click here.
Learn about Thailand’s Foreign Business Act, which lists the activities foreign companies are prohibited from conducting. The FBA restricts foreigners or foreign-owned companies from undertaking over 50 categories of business activities in Thailand.
For more information, please read our blog post on the subject here.
Thai Company Registration
Starting a business in Thailand requires you to register your company. This is a crucial step, and there are a few things you need to do to complete the process.
First, you will need to reserve a company name. You can do this through the Department of Business Development (DBD). Once you have reserved a name, you will need to prepare the necessary documents. These include the Memorandum of Association (MOA) and the list of shareholders.
The MOA is a legal document that outlines the structure and operations of your company. It includes information such as the company’s name, address, purpose, and capital structure. The list of shareholders is a document that lists the names and contact information of all of the shareholders in your company.
Once you have prepared the necessary documents, you can submit them to the DBD for registration. The DBD will review your documents and, on approval, will issue a certificate of incorporation. This certificate is proof that your company holds official registration and can legally operate in Thailand.
Work Permits and Visas
Foreigners working or intending to work in Thailand must have the proper work permits and visa type.
It is important to note that Thailand has a broad definition of work and employment, which may or may not relate directly to revenue or income. For example, a foreigner can be a shareholder and/or a company director and not require a work permit. However, if they do something such as sign a document on behalf of the company, this will be considered work, and they must have a work permit.
To work in Thailand, you must apply for a Non-Immigrant ‘B’ or Business Visa and apply for a work permit upon entering Thailand.
Paid-Up Capital and Bank Account
To legally work in Thailand, you may need to meet a minimum paid-up capital requirement. Opening a bank account with a commercial bank is also necessary.
What is the Process to Register a Business in Thailand?
Here is a breakdown of the process of registering your business in Thailand, which involves several steps. Go through our 10-point checklist that comprehensively covers you through the process of company registration in Thailand in 2024 –
How can Konrad Legal help?
For more information about how to start your business in Thailand in 2024, why not talk to one of our experts now?
Please note that this article is for information purposes only and does not constitute legal advice. For best results, email us at [email protected].
