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%.

[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.

[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"?

[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).

 

 

[bluebird729]

On 5/19/2023 at 2:58 PM, ElephantEgo said:

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.

check your maths!

[Maestro]

32 minutes ago, bluebird729 said:

check your maths!

 

I wonder how helpful your reply to a post made almost two years ago is to the OP.

 

@ElephantEgo  I am curious to know if you got formal clarification on the legality of the status of company B.

[FritsSikkink]

On 5/20/2023 at 1:47 PM, 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.

already commented 2 years ago