Company Registration in Thailand

Company Registration in Thailand Thailand offers a structured and relatively efficient company registration framework governed by the Civil and Commercial Code (CCC), with oversight from the Department of Business Development (DBD) under the Ministry of Commerce. While the process is straightforward for Thai nationals, foreign participation is regulated under specific laws including the Foreign Business Act B.E. 2542 (1999) and investment promotion laws.

This article provides a deep dive into the company formation process, including required documents, registration stages, legal limitations for foreign investors, and post-registration compliance.

I. Legal Forms of Business Entities

Foreign and local investors may choose from several entity types, depending on business objectives:

1. Private Limited Company (Co., Ltd.)

  • Most common form for commercial activity

  • Must have at least 3 shareholders

  • Liability limited to capital contributed

  • Can be wholly Thai-owned or majority Thai-owned with foreign shareholders

  • Board of Directors manages day-to-day operations

2. Public Limited Company (PLC)

  • Used for companies listed on the Stock Exchange of Thailand

  • Requires minimum 15 promoters and 5 directors

  • Suitable for capital-intensive businesses or IPO planning

3. Branch Office

  • Acts as an extension of a foreign company

  • Can earn income, but is taxed as a Thai company

  • Must be registered with the DBD and obtain a Foreign Business License for restricted activities

4. Representative Office

  • Non-revenue-generating

  • Limited to activities such as market research, sourcing, or quality control

  • Funded entirely by the foreign head office

  • Requires minimum capital of THB 2 million

5. Regional Office

  • Coordinates operations of affiliated companies in ASEAN

  • Cannot earn income or sign sales contracts

II. Pre-Registration Considerations

A. Company Name Reservation

  • Submit at least three name choices to the DBD via their online portal

  • Names must not resemble existing registered companies

  • Approved name is reserved for 30 days with no extension

B. Registered Office Address

A physical address in Thailand is mandatory. A lease or ownership document must be submitted during registration. Virtual offices are not accepted for certain regulated sectors.

C. Shareholding Structure

Under Thai law:

  • Thai individuals must hold more than 50% for the company to be considered Thai-owned

  • If foreign shareholders exceed 49%, the company may need a Foreign Business License (FBL) unless exempted under:

    • The US-Thailand Treaty of Amity

    • The BOI (Board of Investment) promotion

    • Special Economic Zones

Bearer shares are not allowed. All shareholders must be identifiable.

III. Company Registration Process

Registration with the DBD involves several stages. As of 2023, the process can often be completed within 3–5 business days, provided documents are in order.

Step 1: Reservation of Company Name

Filed online with the DBD. The name must comply with naming regulations and avoid terms like “royal,” “state,” or “national.”

Step 2: Filing of Memorandum of Association (MOA)

The MOA must include:

  • Company name and location

  • Business objectives

  • Registered capital and number of shares

  • Names and addresses of promoters (at least 3)

  • Liability limitation clause

No minimum capital is legally required unless the business falls under restricted categories. However, THB 2 million is the general threshold for foreign ownership under the FBA.

Step 3: Statutory Meeting and Articles of Association

Promoters call a meeting to:

  • Adopt the Articles of Association (AoA)

  • Appoint directors and auditors

  • Allot shares and fix payment terms

In many cases, this step is consolidated with registration to save time.

Step 4: Company Registration with the DBD

Within 90 days of MOA filing, the company must be formally registered. Required documents include:

  • MOA and AoA

  • Minutes of statutory meeting

  • List of shareholders

  • Directors' declarations

  • Proof of office address (e.g., lease agreement, utility bill)

  • Identification documents of shareholders and directors

Registration fee: THB 5,000 per THB 1 million capital, capped at THB 250,000.

IV. Tax Registration and VAT

After company formation:

  • Obtain a Taxpayer Identification Number from the Revenue Department

  • If expected income exceeds THB 1.8 million annually, register for VAT

  • Register for Social Security if hiring employees

A corporate bank account can then be opened. Banks may require director presence, corporate documents, and proof of business activity.

V. Foreign Business License (FBL) and Investment Promotion

Foreigners engaging in restricted businesses (under the FBA Schedule 1–3) must apply for a Foreign Business License. Examples of restricted activities include:

  • Retail and wholesale

  • Services (broadly defined)

  • Construction (unless public utilities)

  • Accounting, law, and engineering

Approval may take several months and is discretionary.

BOI Promotion

The Board of Investment can issue foreign investment privileges, including:

  • 100% foreign ownership

  • Exemption from FBL

  • Tax holidays and duty exemptions

  • Facilitated visas and work permits

BOI approval is merit-based and requires project proposals aligned with targeted sectors (e.g., tech, R&D, renewable energy).

VI. Post-Registration Compliance

A. Annual Filings

  • Submit financial statements within 5 months of fiscal year-end

  • Conduct an Annual General Meeting (AGM)

  • File shareholder list (Form Bor. Or. Jor. 5) with DBD

B. Corporate Income Tax

  • 20% flat rate

  • SMEs with under THB 3 million profit may benefit from reduced rates

C. Withholding Tax and VAT

  • Withhold tax on services, interest, rent, and dividends as required

  • File monthly VAT returns and payments (if registered)

D. Social Security

  • Employers must register within 30 days of hiring an employee

  • Contributions required monthly (5% of salary, capped)

VII. Restrictions on Nominee Shareholding

Thai law prohibits nominee structures, where Thais hold shares on behalf of foreigners without real investment or control. This is a criminal offense under both the FBA and Anti-Money Laundering Law.

Indicators of nominee structures include:

  • Thai shareholders lacking income/assets to match investment

  • Use of identical addresses or bank accounts

  • Side agreements transferring control or dividends

Foreign investors must exercise genuine control and risk over their shareholding, or pursue lawful structures such as BOI promotion or Amity Treaty registration.

VIII. Corporate Governance and Liability

Thai companies are managed by a Board of Directors. Directors have fiduciary duties and can be personally liable for:

  • Fraud or misrepresentation

  • Violations of tax or labor law

  • Failure to file required documents

Shareholders have limited liability, but can also face veil-piercing in cases of fraudulent use of the corporate form.

Conclusion

Company registration in Thailand offers a structured but regulated environment for both local and foreign entrepreneurs. While the basic process is procedurally clear, foreign-owned entities face significant legal, financial, and regulatory scrutiny, especially under the Foreign Business Act.

Understanding the nuances of entity selection, capital structuring, licensing, and compliance is critical to long-term operational viability. Given the potential legal consequences for missteps—especially regarding foreign ownership—it is highly advisable to work with qualified Thai legal counsel and corporate service providers when setting up and running a business in Thailand.

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