Companies & & Goverbment changes to Companies in Thailand

SETTING UP A COMPANY:

Rules for work permit holders. New companies wishing to have work permits need to show their share capital in the Bank? FOR EVERY FOREIGNER wishing to join an existing Thai company you must now show 2m baht in the bank when they go to register. For each additional foreigner you need to show 2m baht per each. Company rules came into being regarding share capital when forming a new company. Its a lot easier to buy a second hand company now then have a new company as the Thai director must have access to the Company Bank account; all the shareholders will be interviewed on work roles so you cannot have nominees and the Thai shareholders must have bank accounts. Your premises will be inspected as well. One work permit 2m baht and you need WP3 form from the labour Office to apply for a work permit and increases of 2m baht per work permit after that. A 1m baht company does exist again for foreigners regardless if married to Thais or not but you cannot use to have work permit and you will not get a non immigrant B visa as you need WP3 or Tor Tor 3 form if you go to an embassy away from Thailand etc. THIS MEANS YOU MUST HAVE A COMPANY SET UP ALREADY.

You are not allowed to form a Company just to hold a house or property under. The law states that you must carry on a business and in March 2006 the authorities set about investigating companies and their employees. A Company must file yearly audit; have 7 shareholders and the Thai workers. This old law was enforced on May 25th 2006 and now Companies who have properties must prove where the money came from & all new house sales under Companies will be looked at. With housing developments foreigners have benefited themselves on property sales so this practice is now under investigation and especially in high level property sales in Samui, Pattaya, Phuket. Many foreigners & small property owners are affected by this now but like anything if you do things right in Thailand you will be OK but always ask second opinions!!!! It may save you in the long run.

In a company you need 7 partners & foreigners can only hold 49% shares but you can according to the investment control 100% via B.O.I. (Board of Investment) or if American have an Amity company. Foreigners as from 2001 can make up 6 out of 7 shareholders but Thais still hold 51% of the shares. What one does not know until they decide to form a company is that certain businesses are closed to foreigners. These businesses are categorized into 2 different areas with 3rd open. So when you form a company make sure it doesn't come under the following or write to us.

The Alien Business Law (N.E.C. Announcement 281). Business activities falling in categories A & B are generally closed to foreigners. Under category C you must obtain a permit prior to commencing business. Businesses outside these categories are exempt. The Ministry of Commerce will also help applications of non trading offices.
Category A: 1.Agriculture: rice farming; salt farming. Commercial Business: Internal trade in local agriculture products, Land trade. Service business: Accounting, farming animals, architecture, advertising, brokerage, auctioning, Barber, hair dressing & beautician. Building industry.
Category B. 1. Agriculture Business: orchids, cultivation, animal husbandry including silk worm raising, timbering, fishing. 2. Industrial & Handicraft: Rice milling, Flour making, sugar, alcohol & non alcohol drinks, Ice cream, Pharmaceutical manufacturing, cold storage, timber, gold, silver and inlaid stone, wood carving, lacquer-ware, match making, cement etc, Dynamiting rocks, Manufacturing garments & shoes, Printing, newspaper publishing, silk weaving or silk printing, manufacture of finished products in silk.3. Commercial: all retailing not in category C. Ore trading not in Category C, selling food an drinks, trading of antiques & fine arts.4 Service Industry: Tour agency, Hotels except Hotel management, photography, laundering, dress making and service jobs.5. Land, water & ie. transport.
Category C. You are allowed to do the following. Exporting, all wholesale trades not in A & B. retiling machinery, equipment & tools, selling food, beverages that promote tourism. Industrial & handicraft Business: manufacturing animal feeds, vegetable oil extraction, textile manufacturing, dyeing, fabric printing, glass ware manufacturing, making plates and bowls, stationary & printing paper, rock salt mining, mining.
Service: anything not in A or B.

Costs 25,000 baht plus you need to have 7 shareholders in place; Bangkok is usually more up to 54,000baht . Prices may not include Govt fees & ID tax code for you or VAT reg. If you use our services we outline in English each step you are paying for & no hidden costs are included. We welcome any questions or queries you have.

IF INTERESTED WE DO HAVE AUDITED COMPANIES FOREIGNERS WISH TO SELL. POA.

When forming a company you needed ex Thai shareholders (now changed to 6 foreigners & one Thai OR ANY COMBINATION ). Those early companies used lawyers who in turn used their staff as nominees or Thais off the streets. Once paid off then that's the end of those nominees, or you thought. However one must remember that if you make a yearly profit you must pay dividends to all the share holders. But, where are they: "the inevitable, my lawyer will take care of it"?? A lawyer is not an accountant so make sure you differentiate between having both when you start a Company. If you are not paying VAT, Social Welfare tax & no yearly audits you will be fined. If you own a property and use a company you must carry on a business & run into profit mode after 3 years.

One can transform a Thai company into a foreign firm. For some of these companies it is to risky to maintain the Thai status as the intention violates the Alien Business Law. It is now difficult for small and medium foreign companies with capital registration of less than Thai Baht 100 million to get a wholesale license, service license and/or retail of machinery-equipment license as the application has to be approved by a 21 persons committee comprising of high-ranking authorities from various ministries etc. This committee will protect small and medium Thai Business.

COMPANY NAME: Cannot be a country or city name & must end with the words: Company Limited (Co. Ltd); Corporation Limited (Corp.Ltd); or Limited (Ltd). [ CHECK SETUP COSTS ]

COMPANY REVIEWS 2007 BY THE GOVERNMENT : 25th July 2007

The National Legislative Assembly is considering management control as one aspect to define any company as foreign under the Foreign Business Act (FBA), according to Skol Harnsuthivarin, a Commerce Ministry official. The amended draft FBA this week passed first reading from the NLA and a new subcommittee was set up to rectify the draft, he said. According to Mr Skol, some committee members want to include management control in addition to voting rights, which would be taken into account in the definition of a foreign company. The draft is due to be tabled soon for its second and third readings in the NLA and is likely to be passed by the interim government, he believes.

AMITY TREATY COMPANY:

Only open to USA companies and individuals but you can own 100% of your company. You need a company first and then you apply to the USA Embassy in Bangkok. To see what you must do go to [ Amity treaty ].

We now offer a Thai work permit, Thai company & Thai limited partnership. Ask us for more information. or go to [ LAWYER ]

THAILANDS AUCTION & CLASSIFIEDS:

www.thaitrademe.com

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