Language barriers make Thailand incorporation a difficult prospect for many foreign investors. Consequently, the majority of business people engage a professional services Firm to handle all aspects of Thailand incorporation, from company set up to assistance with opening a bank account, managing tax and accounting formalities and even obtaining work and residence permits for the investor and his expatriate staff. Important elements to note with the Thailand incorporation process include:

The majority of foreign entrepreneurs incorporate a Thai private limited company. A Thai private limited company can be 100% foreign-owned, although it requires at least seven shareholders. Company incorporation in Thailand typically involves:

i) reserving company name at the Department of Business Development;

ii) submitting Memorandum and Articles of Association to the Department of Business Development;

iii) injecting 25% of the registered capital;

iv) paying statutory Thailand incorporation fees;

v) tax registration and VAT registration (if required).

It is also possible for international investors to register partnerships. There are two types of official partnerships in Thailand:

i) An ordinary partnership is a shared unlimited liability structure with a minimum requirement of two joint partners. All partners involved are jointly and wholly liable for all obligations of the partnership. If registered, an ordinary partnership is a legal entity separate and distinct from the individual partners.
ii) A limited partnership is similar to an ordinary partnership with the exception that it requires compulsory registration. The prime advantage of a limited partnership is that creditors cannot sue individual partners unless the partnership is dissolved. Consent is needed from all partners for new partners to enter into the partnership.

Some investors open a Representative Office in Thailand. However, the scope of permitted activities of a Representative Office make this an uncommon form of Thailand incorporation. A Representative Office is predominantly used to provide local market information/conduct market research and feasibility studies on behalf of a foreign head office. The information is then used by the foreign parent when making a decision on whether to invest in a fully-fledged operation in Thailand.

For more information on Thailand company set up, purchase our Asia Business Setup book. Alternatively, contact email@healyconsultants.com or call us in Singapore (+65) 6735 0120.

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