Forming a tourism company

[NOLA]

I am strongly thinking about relocating to Thailand and forming a specialty tour company there. I have looked at this site and the BOI site and I am still confused. Is tourism always a restricted activity for foreigners? Can anyone tell me if the Treaty of Amity for American companies makes this possible, even if it were not possible for other nationalities?

Also, if I were able to get a multiple entry visa for a year could I potentially run the company through the U.S. (initially) and then create the Thai company once I am a bit more established there? I would be using already existing U.S. tour companies to supply the actual on-site tour component, adding only my specialty component on top (so that all payment including my own would be paid for in the U.S.).

Any help that anyone can provide me in understanding these issues would be greatly appreciated!!

[george]

Nola, the Thai Gov't actually promotes investors to the Tourism sector, so it should not be a problem at all.

I will try to to get Khun Wisarut from BOI here asap.

[NOLA]

Thank you George.

I have been very confused by the list of proscribed buisness that I found on the BOI site and this site.  Clarification would certainly be appreciated...

[Wisarut]

Thank you to George… for mail me the topic… Nola, My question is, what is the specialty tour company you would like to form in Thailand. Take a look at this link…http://www.boi.go.th/english/boi/section7_2545.pdf.

There are two business categories 7.3 and 7.4 pertaining to the tourism promotion service. Basic requirement is 1 million bath minimum in investment exclude cash flow and land.

For the BOI promoted company, BOI will issue you the unlimited number of work permit as long as necessary for your business. The foreign shareholder can be up to 100 %. The income tax exemptions in both categories are varying to the location of your business.

The general guide tour is in the List three of Foreign Business Act B.E.2542 (1999). To run this business category, you must have foreign business license. The license can apply at Commercial Registration Department, Ministry of Commerce.

[NOLA]

Thank you Kuhn Wisaruth..

The company that I am exploring opening in Thailand, would provide photographic tours of Thailand and other S.E Asian countries.  Initially, I would most likely be working with existing U.S. tour operators who already do business with Thai nationals providing tours in Thailand. I would simply be adding my services on top of their existing tour services (so my payment would most likely comes from the U.S.). Eventually, I would want to also provide all services in Thailand through my company.

These are the portions of the Foreign Buisness Act that I understand would apply to such a business:

C. Businesses Subject to Regulation

Businesses that initiate activities that fall under Lists 1, 2, or 3 of the Foreign Business Act (listed below) are subject to the limitations imposed by the Act.  

Activities in List 3 are prohibited to aliens unless permission is granted by the Director General of the Department of Commercial Registration, Ministry of Commerce, by and with the approval of the Foreign Business Board.

An alien can engage in businesses in Lists 2 or 3 of he is a promoted investor in accordance with either the Investment Promotion Act, the Industrial Estate Authority of Thailand Act, or other laws.

List 3 - Businesses in which Thais are not ready to compete in undertakings with aliens:

(includes)

-Tourism-

Many American-owned enterprises have invoked the provisions of the Treaty of Amity and Economic Relations between Thailand and the United States to claim exemption from the Law. The treaty requires national treatment be granted to persons of each country by the other country. To receive protection, Americans must register under the Treaty. Although on paper the Treaty appears self-executing, the Thai Government will not recognize the American applicant until such applicant proves its American nationality.

I would appreciate your help in clarifying this for me.  As an American owned business using the Amity Treaty, would I be able to create a company that provided photographic tours of Thailand?  Would I still need the the Foreign Business License and would it likely be granted?  Also, do I understand that I would be required to have a minimum of 4 Thai Nationals as employees in my company in order to gain a work permit for myself? If instead, I were simply adding my own services and all other components of the tours were being provided by Thai Nationals being paid by U.S. tour companies, would I still need to create my own company?  I belive that the answer to this is yes, since I would need a work permit to perform the work in Thailand - is this correct?

Thank you once again for your kind assistance..  :laugh:

[NOLA]

Kuhn Wisarut

I also found this portion of a document on the BOI site, regarding work permitswhich confuses me even more.. could you be so kind as to explain this to me? Tourist guide or tour organizing agency is one of the restricted occupations and this is what my company would be doing.

F. Restricted Occupations

A Royal Decree in 1973 listed 39 occupations and professions that were then prohibited to aliens. This list has been amended on several occasions by subsequent Royal Decrees, the latest one in 1979.  

Labor  

Work in agriculture, animal breeding, forestry, fishery or general farm supervision  

Masonry, carpentry, or other construction work  

Wood carving  

Driving motor vehicles or non-motorized carriers, except for piloting international aircraft  

Shop attendant  

Auctioneering  

Supervising, auditing or giving services in accounting, except occasional international auditing  

Gem cutting and polishing  

Hair cutting, hair dressing and beautician work  

Hand weaving  

Mat weaving or making of wares from reed, rattan, kenaf, straw or bamboo pulp  

Manufacture of manual fibrous paper  

Manufacture of lacquerware  

Thai musical instrument production  

Manufacture of nielloware  

Goldsmith, silversmith and other precious metal work  

Manufacture of bronzeware  

Thai doll making  

Manufacture of mattresses and padded blankets  

Alms bowl making  

Manual silk product making  

Buddha image making  

Manufacture of knives  

Paper and cloth umbrella fabrication  

Shoemaking  

Hat making  

Brokerage or agency work, except in international business  

Dressmaking  

Pottery or ceramics  

Manual cigarette rolling  

Legal or litigation service  

Clerical or secretarial work  

Manual silk reeling and weaving  

Thai character type-setting  

Hawking business  

Tourist guide or tour organizing agency  

Architectural work  

Civil engineering work  

[Wisarut]

I don’t know exactly of the Treaty of Amity and Economic Relations between Thailand and the United. I will ask my friends at the Commercial Registration Department in tomorrow and tell you more.

As far as my experience, there are many American tour companies doing the business, in the list 3 and already got the business license. For the photographic tours, I don’t think It will have any difficulty since Thai government always arrange visit Thailand promotion activities by inviting foreign photographers to take picture in Thailand.

The advantage of your own company is that your can take control by yourself, and you can get customers royalty to your business. In my viewpoint, if you can reach the outcome, the easiest way is the best. Let me ask from my friend about the “Treaty of Amity” at the department, then tomorrow I will tell you more. Also I think you need the work permit to run the business.

“A Royal Decree in 1973 listed 39 occupations and professions that were then prohibited to aliens.” They prohibit to the persons who perform the work, but don’t prohibit the company to do the work. The example is that your company has to hire Thai guides to guide your customers to the place to take the pictures, but you can command your guide go to anywhere which is the most beautiful to take the picture. The work permit would be issue to be the “Photographer Specialist”, but cannot issue to be the “Tour Guide”.

Please don’t hesitate to ask more questions, or if it is involve business secret, e-mail me.

[Sunbelt]

Only the following business activities are excluded from protection under the treaty.

communications  

transportation  

fiduciary functions

banking involving depository functions

exploiting natural resources or land  

domestic trading in indigenous agricultural products

Tour Guide is not one of the restricted businesses. You simply become the Managing Director.

[NOLA]

Thank you Sunbelt..

Just to clarify.. are you saying that under the Treaty of Amity for Americans, these are the only restricted occupations?  If I did not choose to invoke the Treaty (which creates additional costs), would this then be a restricted occupation?

Thanks to all of you for your excellent help in this matter.. ::

[Wisarut]

Thank you Khun Naravadee. Then I have no need to ask other people.

[Sunbelt]

are you saying that under the Treaty of Amity for Americans, these are the only restricted occupations?

Yes

If I did not choose to invoke the Treaty (which creates additional costs), would this then be a restricted occupation?

Yes

By the way on the 6 restrictions for Americans, this was the USA's idea not Thailands.

Under the Amity, the USA in return gives Thais the chance to own a business in the USA under the E-2 visa. One of the reasons why the third largest population of Thais can be found not in Thailand but in the USA.

[ThaiAdventure]

I will certainly be having words with the British government about the American Treaty. Campared to what I have to go through....you've got it easy-I want one!!

[Sunbelt]

At the time this treaty was being negotiated and at the time it was ratified in 1968 by the United States both Thailand and the United States were allies in the Vietnam War. As a friendly gesture toward each other Thailand and the United States entered into a treaty of amity and economic relations. That’s how it came about... The Thais were scared of communism and wanted protection from their neighbor.

[TSC]

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