Weekly Recap: Legal Structures in Thailand
This week we covered the legal foundation every foreign investor needs to understand. Here's your quick reference guide.
Key Concepts Covered
The Foreign Business Act (FBA)
The main law governing foreign business ownership in Thailand. It defines who is "foreign" and restricts approximately 50 business categories.
The 49% Rule
In restricted categories, foreigners cannot own more than 49% of shares. But this rule can be bypassed legally through BOI, Treaty of Amity, or other pathways.
Restricted vs. Unrestricted
- Restricted: Hotels, restaurants, retail, real estate
- Unrestricted: Software, digital content, export manufacturing
Nominee Arrangements
Using Thai nationals to hold shares on your behalf is illegal and actively prosecuted. Penalties include deportation, fines, and imprisonment.
This Week's Case Study
An American software entrepreneur lost his entire business because he used a nominee instead of applying for BOI promotion—which he would have easily qualified for.
Key Takeaway
The legal structure you choose determines everything that follows: ownership rights, tax rates, work permits, and exit options. Get it right from the start.
Coming Next Week
We'll dive into BOI Promotion:
- What it is and why it matters
- Benefits for foreign investors
- Eligibility requirements
- The application process
Related Service: Company Registration & Legal Services — Expert guidance on choosing the right structure.
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