Expats interested in starting a business in Thailand must thoroughly understand the FOREIGN BUSINESS ACT, B.E.2542 (1999). This Act outlines the types of businesses that foreigners are permitted to put up as well as the requirements, fees, and restrictions on doing so. Some restrictions involve purchasing property as foreigners.
It is important to note that foreigners who fail to comply with any of the stipulations of the Act will be held liable to either a fine or imprisonment as well as the cessation of business operations.
Types of Businesses:
The Foreign Business Act B.E. 2542 (FBA) lists 3 types of business activities:
List 1: Businesses Not Permissible to Foreigners by Special Reason
List 2: Business related to National Safety or Security or having impacts on Arts, Culture, Traditions, Customs and Folklore Handicrafts or Natural Resources and the Environment
List 3: Business in which Thai nationals are not ready to compete with foreigners
Businesses under List 1 are strictly prohibited to aliens. Those under List 2 are prohibited to foreigners unless permission is granted by the Cabinet while those under List 3 are prohibited to foreigners unless permission is granted by the Director-General of the Commercial Registration Department.
The minimum capital required for a foreigner to operate a business in Thailand shall not be less than two million Baht. For businesses specified in the Lists that require permission, the minimum capital must be at least three million Baht.
For business under List 2, an application must be submitted to the Minister or Director-General and the Council of Ministers. For those under List 3, an application must be submitted to the Director-General.
There are different fees that need to be paid starting with the applications for Licenses, the License itself, the Certificate, and for the Appeals in case there is an order refusing to grant permission.
The rates for both the application and the licenses vary depending on the type of business to be put up and on which section in the FBA it falls under. Applications will cost 1,000 – 2,000 Baht. Cost of licenses also varies depending on whether the applicant is a natural person or a juristic person.
For a complete list of fees and businesses activities specified in each of the three lists, you may refer to the Foreign Business Act B.E. 2542 (FBA).