Thailand is an attractive investment destination as it is the second largest economy in south East Asia. Many foreigners prefer to invest in the country because of the low costs of labour and favourable investment environment.
Sole proprietorship is a business owned by a single individual. Though it is possible for foreign nationals to incorporate sole proprietorship firms, they have to meet strict requirements to do so.
Partnerships is an agreement between two or more partners to do business and share the profits or losses in predetermined shares. There are three different types of partnerships in Thailand. Unregistered ordinary partnership, registered ordinary partnership and limited partnership. Foreigners are allowed to open limited partnerships with Thai partners.
Most of the foreigners in Thailand prefer to incorporate a limited company in the country. A limited company can hire foreign nationals and apply for work permits. There are public and private limited companies in Thailand. The capital requirements for both the companies differ depending on their composition, Thai majority companies and Thai minority companies. All the companies are governed by the Foreign Business act 1999 and strict adherence to the provisions in the law is recommended. Any failure will result in steep fines and imprisonment. Foreigners can also opt to set up Thailand BOI promoted companies to enjoy incentives offered by the board.
Most of the foreigners are now looking to invest in the country through Thailand BOI because of the attractive incentives and guidance offered by the board of investment. The BOI promotes businesses according to the industries. It prioritizes companies that add value to the local economy and aid in the faster growth of the economy. Thai BOI promotes companies which invest in research and development and use high end technologies that aid in the development of local infrastructure and the growth of exports.
The Thailand BOI offers attractive tax and non-tax incentives to the companies promoted by them. Foreigners can incorporate hundred percent foreign owned businesses through this route. However, the companies should apply to the BOI and get selected by them to receive the BOI promoted status. Companies promoted by the Board of Investments are required to submit various reports to the board regularly.