Thai Company Setup

What is a Thai Company?Company Setup

A Thai company is usually referred to as a Limited company with at least 51% Thai and 49% foreign shareholding.

Why is a 51% Thai shareholding required?
Thailand introduced a Foreign Business Act which simply spoken forbids or restricts most professions to foreigners. The government requires a minimum 51% of Thai shareholders to award the company the status of a Thai company which is then licensed to conduct its desired business.

How can I protect my investment since I only own 49% of the shares?
In Thailand it is legal to create a two tire share structure. In practice this means that you can have shares with quite different voting rights so technically you can’t own it but you can control it!

What can I do with this kind of company?
For a foreign investor it opens a wide range of possibilities of business activities that he or she can conduct.

Common work permit question for this setup:

Do I have to hire Thai staff for my work permit?
Yes, the standard obligation is having 4 Thai employees and paying taxes to the Social Security.

How much registered capital do I need for a work permit?
The standard rule is 2 million Baht registered capital. There is an exception for people married to a Thai citizen to be only 1 million Baht registered capital.

Is there something else to consider?
It is quite common that a foreign investor forgets the requirement of having a registered address and to maintain it. This is important as the Ministry of Labour does require an actual physical working space. In addition to this Thai law does require to the company to keep a minimum of 3 shareholders at all time.

Even operating your business with a Thai company does sound rather simple there are several exceptions to the above mention i.e. license requirements, higher Thai shareholding requirements, Thai directorship or even more favorable structures.

We are looking forward to help you grow your business and as well to receive your inquiry soon.

*It is possible to apply for an alien business license which we found to be a lengthy and more expensive process.

Legal Disclaimer: All information displayed on this site are compiled with the most amount of care. As law and life is bound to changes we cannot warrant that all information is accurate at all time and intended to be a guideline. In order to provide you a correct and up to scratch information please do contact our experienced business lawyers.