Thailand foreign business restrictions

The following data are types of industries restricted to foreign investors to conduct in Thailand as prescribed in the Foreign Business Act:

List 1:  List of businesses that are exclusive to Thai nationals

• Newspaper publication, radio broadcasting and TV station
• Land trading
• Trading and auctioning of Thai antiques or Thai historical objects

List 2:  This list of businesses is grouped into 3 categories and is permitted to foreign investors under special conditions.

Category 1 – Business affecting national safety or security businesses

• Production, selling, repairing of firearms, gun powder and explosives
• Production, selling, repairing of ships, aircrafts or military vehicles
• Domestic land, waterway or air transportation, including domestic airline business.

Category 2- Business affecting arts and cultures, traditional and folk handicrafts

•  Trading of antiques or handicrafts
•  Production of Thai musical instruments
• Production of goldware, silverware, nielloware, bronzeware or lacquerware

Category 3- Business affecting natural resources or environment

• Manufacturing of sugar from sugarcane
• Mining, including stone blasting or crushing
• Wood fabrication for furniture and utensil production.

List 3 – List of prohibited international competitive business which Thai nationals are still unequipped to compete with.

• Production of plywood, veneer board, chipboard or hardboard
• Production of lime
• Engineering service business
• Architecture service business
• Legal and accounting service business
• Tour agency
• Selling food or beverages

Obtaining a Thailand Foreign Business License

Thailand companies with majority of foreign ownership require obtaining a foreign business license from the Foreign Licensing Department of the Ministry of Commerce. The process is often facilitated when Thai BOI approval is obtained. A foreign business license may potentially grant non-Thai nationals 100 % ownership for types of businesses under certain categories of otherwise prohibited businesses. Factors affecting the approval and issuance of a Thai foreign business license may include the impact on Thai employment, transfer of technology, benefits to the public and the ability of Thai nationals to perform the activity, among others. Generally, the application process for a Thailand foreign business license is very lengthy and complex. It may take a minimum of four months for foreign companies to receive a decision on its application.

Thailand BOI Incentives

The Thailand BOI incentives are classified into the following types:

• Tax Incentives

 A BOI promoted company in Thailand may be eligible to receive an exemption or reduction of import taxes duties and may also be eligible to be exempted from a juristic person’s tax and dividends, as well as double deductions from the cost of transportation, electricity, water and project’s infrastructure installation.

• Non-Tax Incentives

Local and foreign businesses certified by the Thai BOI are eligible to hire foreign skilled workers and experts. Further, the BOI provides for express non-immigrant visa and work permit processing through “One-stop Visa”. Non-tax incentives may also permit foreign freehold landownership to businesses involved in industrial related projects.

Setting up a Thai BOI Promoted Company

Investors seeking to do businesses in Thailand may apply for a Thai BOI promotion. The BOI categorizes industries according to types and provides application forms specific to each industry.  Generally, companies that are given priority for Thai BOI licensing are those involved in technology and innovation, manufacturing and export and other investments showing potential business growth.   Non-industrial businesses such as nursing homes for the aged and movie productions are also promoted by the Thai BOI with investment incentives.