Businesses involving foreign investors in Thailand are typically registered as a Limited Company and must have the status of a Thai legal entity. This means that more than 50% of the company’s shares must be held by Thai citizens or Thai companies.
Legal Framework
This requirement is based on the Foreign Business Act.
If 50% or more of the shares are owned by foreign shareholders, the company is classified as a foreign legal entity.
The law includes a list of business activities restricted to Thai entities, divided into three categories:
Restricted Business Categories
Category 1 — Completely Prohibited for Foreign Companies
- media (press, radio)
- agriculture
- land trading
Category 2 — Related to National Security, Culture, or Natural Resources
- weapons industry
- antiques
- mining and natural resource extraction
Foreign companies may engage in these activities only with special permission.
Category 3 — Businesses Where Thais Are Not Ready to Compete
- accounting services
- legal services
- architecture
- advertising
Foreign companies may operate in these sectors only after obtaining a Foreign Business License.
Practical Reality
These lists cover almost all types of business activities:
- Category 1 → completely closed to foreign businesses
- Categories 2 & 3 → require a Foreign Business License, which is difficult to obtain
For example:
- companies promoted by the Thailand Board of Investment (BOI) may obtain such a license
- but only after receiving a BOI certificate
However, many common businesses do not qualify, including:
- real estate sales
- restaurants
- consulting services
- agency services
- guesthouses
New Regulation (June 25, 2019)
The Ministry of Commerce issued a regulation exempting certain activities from the Foreign Business Act. These relate to intra-group (operational) services, including:
- lending funds to affiliated or subsidiary companies
- leasing office space to branches or subsidiaries (including utilities)
- providing consulting services in:
- management
- marketing
- human resources
- information technology
to affiliated or subsidiary companies
Definition of Affiliated and Subsidiary Companies
The regulation defines such companies as those where:
- a company holds 25% or more of shares in another company
In such cases:
- a company may be 100% foreign-owned
- if its activities are limited to the exempted services listed above
For inquiries regarding registration of a 100% foreign-owned company, please contact:
+66 81 504 6625
Author: Alexandra Agapitova.
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