Recent studies show that the Kingdom of Thailand is the best country to start a new business, according to The US News and World Report global perception-based survey. The survey included five voting pillars – affordability, bureaucracy, low manufacturing costs, global connection and access to capital. The survey looked across the board at agriculture, manufacturing, textiles, electronics and tin.
Data from the Trading Economics ranked Thailand 21st out of 190 world economies in The Ease of Doing Business. The index ranks countries against each other based on how the regulatory environment is beneficial to business operations. Thailand is a convenient hub in the ASEAN region.
The Thai Government is keen to increase investment year-on-year and frequently offers incentives to the business world. Joint ventures are openly encouraged for more profitable opportunities.
Thailand has various legal structures in place so that foreigners can undertake a range of business within the Kingdom. Upon understanding your business organization, International Business Consultants will advise you on the appropriate legal structure required to operate your business within the country.
There are three primary forms of commercial business organizations in Thailand that you will need to consider;
- Unregistered ordinary partnerships. Each partner is wholly and jointly liable for all obligations of the partnership.
- A registered ordinary partnership is a legal entity that allows separation and distinction for individual partners.
- Registered limited partnerships afford individual partners restricted liability to the amount of capital contributed to the partnership.
- Private Limited Companies allow shareholders to enjoy limited liability. A board of directors manages the limited company under the company’s Articles of Association and by-laws. There should be a maintained minimum of three shareholders at all times.
- Public Limited Companies registered in Thailand are subject to compliance. The company may apply to have their securities listed on the Stock Exchange of Thailand (SET). The Board of Directors must have a minimum of five members, and at least half of them must be Thai nationals.
Although not yet recognized as a legal entity under the Civil and Commercial Code the joint venture agreement may be described as a group of persons that form a general practice. Income is classified as a single entry and is subject to corporate taxation under the Revenue Code.
International Business Consultants would be pleased to discuss a suitable structure for your operation and to point out the legal and tax implications for each form of structure.