51% of a "Thai" Company is owned by another Thai Company that is 49% Foreign-Owned -- Is that legal?

[ElephantEgo]

51% of a "Thai" Company is owned by another Thai Company that is 49% Foreign-Owned -- Is that legal? It means that the supposedly "Thai" company is actually about 75% foreign owned.

 

I ask because because someone who committed an offense against my company has such a setup.

[treetops]

Who owns the other 49% of the first company?  If it's other Thais it means the company is about 25% foreign owned, not about 75%.

Edited May 19, 2023 by treetops

[Woof999]

51% or more of the parent company is owned by Thais.

 

51% or more of the subsidiary company is owned by Thais.

 

As with the above poster, I don't know where you're getting the 75% foreign ownership from. Thais have more say in both companies. If the combined foreigners in both the parent and subsidiary companies join forces, there is still a majority of Thais that could overrule them, assuming that all shares hold the same voting rights.

[ElephantEgo]

Thanks for your replies.

Who owns the other 49% of the first company? 
It is owned completely by a foreigner. So the foreigner has 49% of Company A which has 51% of Company B.

The foreigner is also a director of both companies and is the sole director of company B. In doing so, company B is 100% controlled by the foreigner + her nominees in company A.

Effectively then, company B is using nominees and company structures, and foreign ownership, in a way that may or may not be legal, and violate the law. Any guidance on this?

[Kwasaki]

There's always restrictions on what foriengners own and what foriengners can do in Thailand.

 

Hence the 49%.

[JBChiangRai]

13 hours ago, JakeR said:

Thanks for your replies.

Who owns the other 49% of the first company? 
It is owned completely by a foreigner. So the foreigner has 49% of Company A which has 51% of Company B.

The foreigner is also a director of both companies and is the sole director of company B. In doing so, company B is 100% controlled by the foreigner + her nominees in company A.

Effectively then, company B is using nominees and company structures, and foreign ownership, in a way that may or may not be legal, and violate the law. Any guidance on this?

Company A controls Company B, but Company A is controlled by Thai's owning 51% of it.

 

The Thai's owning Company A effectively control Company B, not the foreigner.

 

All perfectly legal.

[khunPer]

26 minutes ago, JBChiangRai said:

Company A controls Company B, but Company A is controlled by Thai's owning 51% of it.

 

The Thai's owning Company A effectively control Company B, not the foreigner.

 

All perfectly legal.

Agree, the juridical person company A owned by 51% Thais, is Thai in regard of company B's ownership; i.e. the 51%.

[Puccini]

18 hours ago, JakeR said:

51% of a "Thai" Company is owned by another Thai Company that is 49% Foreign-Owned -- Is that legal?...

Yes, this is legal.

 

Each of the two companies is controlled by its management.

 

In each company, the management is appointed by a majority vote of the shareholders at a meeting of the shareholders.

[TheFishman1]

That was really confusing. TIT.

[Woof999]

My logic above is wrong.

 

If the falang controls 49% of the voting rights in the subsidiary company and 49% of the remaining 51% (by controlling 49% of the parent company), then the falang does have effective control of the subsidiary. I can't see this being legal, but I'm not a Thai corporate lawyer, so I'd ask one.

[Puccini]

4 hours ago, Woof999 said:

My logic above is wrong.

 

If the falang controls 49% of the voting rights in the subsidiary company and 49% of the remaining 51% (by controlling 49% of the parent company), then the falang does have effective control of the subsidiary. I can't see this being legal, but I'm not a Thai corporate lawyer, so I'd ask one.

The farang (not falang), a natural person, owns 49% of the subsidiary company, The holding company (a juristic person) owns 51 % of the subsidiary company and presumably the manager of the holding company is delegated to vote these 51 % of the shares at the shareholders' meeting of the subsidiary company.

 

At the shareholders' meeting of the subsidiary company, a manager is appointed for the subsidiary company. This manager is in effective control of the subsidiary company.

 

Therefore, the real question is: whom does the shareholders' meeting of the subsidiary company appoint as its manager?

[Maestro]

Removed an off-topic post.

[FritsSikkink]

On 5/19/2023 at 11:48 PM, Woof999 said:

51% or more of the subsidiary company is owned by Thais.

 

No, it is not. It is owned by a company which is 49% foreign. So looks not legal to me. Best to ask a lawyer.

Edited May 21, 2023 by FritsSikkink

[fdsa]

13 hours ago, Maestro said:

Removed an off-topic post.

would you be so kind to explain why you treated my totally on-topic post as an off-topic please?

 

well I assume it was deleted because it described a method to own 100% of a Thai company, which might be considered illegal. But why you don't delete all those posts where people commit immigration crimes by "using an agent to show 800k in the bank"?

Edited May 21, 2023 by fdsa

[SuperSaiyan]

The starter post was totally clear. Parent company (49% foreigner / 51% Thais) owns 51% of a subsidiary company while the same foreign owns the 49% of both companies. It's legal. Only nominees who own the 51% of the parent company wouldn't be legal, if there are any nominees and if you can prove it (nearly impossible).