Opening A Massage Shop.

[Yimmy]

Hi,

I'm planning to open a (relatively small) massage shop in october. Everything is set up bar the legalities of creating a company.

I'm working here and have a renewable non-imm B and WP for my job - I won't be working at the shop. My GF will manage the shop (on the floor) and I will organise/run everything from behind the scenes.

So legally setting up a company like this.... I know this is going to be complex but does anybody know of the steps I have to take to create a legal company.

Or for a Thai to create a legal company, if it makes it alot easier.

Thanks.

[blizzard]

just what thailand needs, another small massage shop. if your gf is hot you may be on to something.......lol.

can you tell me what you going to be doing behind the scene. not much to run , only few customers a day from what i see and these have prime sukhumvit locations.

[RAZZELL]

just what thailand needs, another small massage shop. if your gf is hot you may be on to something.......lol.

can you tell me what you going to be doing behind the scene. not much to run , only few customers a day from what i see and these have prime sukhumvit locations.

I think massage/hair/beauty salon is not the worst idea...

All those girls in Soi 4 like to look their best

RAZZ

[PattayaAddict]

Hope this helps

The laws in Thailand are pretty nationalistic. In the vast majority of cases, the company must be "majority owned" by Thais, in terms of shareholders. This means that the company can be no more that 49% foreign owned. Sometimes, it is a maximum of 39% foreign ownership, and occasionally even less. In most cases it's 49% foreign owned.

This is by far the most serious issue for the largest number of foreigners.

The exceptions -- majority foreign ownership -- require an Alien Business License a.k.a. a Foreign Business License from the Ministry of Commerce, normally granted with the blessings of the Board of Investment (BoI) on the basis of very large investments of money, very large numbers of Thais employed, and/or exceptionally strategic transfer of technology to Thais (such as in the energy field). There are also American Treaty Companies, which I will discuss later on this page. The ability to set up either kind of company depends on the sector of business you are in, and other factors.

I have seen some advertisements saying that you CAN set up a majority foreign-owned company. Sure you can. You can file papers with all foreign shareholders, 100%. You just can't do business with that company unless and until you get an Alien Business License.

However, control of a company, its money, property, decisions, etc., is not necessarily lost by not having "majority ownership". There are some simple measures whereby a foreigner can completely control the company. For example, let's say that you own just 39% of the stock, and the Thais 61%.

You are the sole Managing Director

Sole signatory authority -- the bylaws / Articles of Incorporation state that all decisions must be signed by this Managing Director

You split the stock between "ordinary" and "preference" shares whereby your "ordinary" shares each have 2 times (or more) the voting power of the "preference" shares (preferred for dividend payments, not for voting) (Note: This is changing in 2007, whereby this is disallowed in many sectors, but the guidelines are not yet clear.)

Notably, in addition, you should:

Set a quorum of shareholders at 65% (and thus, if you don't attend, there is no quorum and there are no surprises) so that the bylaws cannot be changed nor can the Managing Director be changed.

(Note: In Thailand, the definition of "ordinary" and "preference" shares varies from some other countries. Some give more voting power to preference shares. It's partly a matter of translation and definition, but there can be philosophical differences, too. In any case, in Thailand you clearly establish the different voting powers.)

The foreign Managing Director can, of course, be the largest shareholder.

Notably, with many law firms, it is common for foreigners to "pay off" the Thai shareholders whereby the Thai shareholders sign away their shares in an undated share transfer agreement right after setting up the company ... but for every Thai shareholder who "resigns" and makes available their share transfer deed, you must transfer the shares to someone else. Shares cannot just be left without an owner; they must be transferred, either to another Thai or else to yourself. If you transfer them to yourself, then you are violating the law by operating as an alien company, and subject to judgement. These law firms will point out that transferring the shares back to yourself "is a minor problem compared with other problems you could have". That depends ... However, in any case, if you go that route, you would just leave signed and undated share transfer agreements in your drawer untransferred and undated ... or in your safe, as that can be a huge risk. You must also report any share transfers in your Annual Report. You can give these shares to someone else as needed, but until someone else accepts these shares, the original shareholders still own them. Again, nobody can just sign away their shares without someone else accepting them.

Another questionable tactic is to have the law firm provide promoters/shareholders who never meet you and don't even know you. This is sometimes presented as "if they don't even know, that's another level of safety". It's illegal. Further, if your company gets rich or acquires property, then if you subsequently have an "unfortunate accident" (or are just murdered), guess who gets all that wealth and property (or arranges to have those shares transferred to them)? Do you really trust these people?

This is NOT to imply that others have such conspiratorial intentions. It is clear that they usually don't, and these things are rare. However, these things do happen occasionally, and these are risks you don't need to take. If you value a good night's sleep, then you might want to know and diversify your shareholders before they become shareholders.

It's also best to state clearly where the wealth of a company goes in case of the demise of the Managing Director, such as in your will, and that everyone knows this. It's also good to make sure that you keep some of your information confidential and safe.

Assigning the shares to your Thai wife and her family can be risky if you have problems with them later. Likewise, you don't want to assign shares to people who may want to take over your business or its assets, of course. It is best to assign these shares to a diversity of Thais who you think you can trust.

Most Thais don't understand their liability by owning company shares. If the shares are paid for, then there is no shareholder liability, generally speaking. That's the whole purpose of a company. If someone owns 500,000 baht of shares, and those shares are paid up, then they are not liable if the company loses money. However, if they own 500,000 baht of shares but only 200,000 baht are paid up, then if the company loses a lawsuit and owes money, they could lose up to 300,000 baht (the unpaid shares they own).

[sgthai]

Hi,

I'm planning to open a (relatively small) massage shop in october. Everything is set up bar the legalities of creating a company.

I'm working here and have a renewable non-imm B and WP for my job - I won't be working at the shop. My GF will manage the shop (on the floor) and I will organise/run everything from behind the scenes.

So legally setting up a company like this.... I know this is going to be complex but does anybody know of the steps I have to take to create a legal company.

Or for a Thai to create a legal company, if it makes it alot easier.

Thanks.

Registered a company under sole proprietorship ( For thai only and in your case your g/f's name)

Another thing to take note of.Your massage shop will need to have a massage certificate besides business registration.

Either your g/f must go for the course to get one or one of your trainer possess a qualify massage certificate.You'll have to hang it up for authority's check whenever they come around.

[lukez]

Registered a company under sole proprietorship ( For thai only and in your case your g/f's name)

Another thing to take note of.Your massage shop will need to have a massage certificate besides business registration.

Either your g/f must go for the course to get one or one of your trainer possess a qualify massage certificate.You'll have to hang it up for authority's check whenever they come around.

Does this mean that Farang cannot register a compaby under sole proprietorship? If so, how to "secure" the company so that it is not a major risk for gf to register it financially if something goes wrong?

[sgthai]

Does this mean that Farang cannot register a compaby under sole proprietorship? If so, how to "secure" the company so that it is not a major risk for gf to register it financially if something goes wrong?

Yes sole proprietorship is only for locals.

To be secure you'll need to register a company with 7 partnership.51% thai and 49% foreign.

Minimum paid up capital.

Subject to auditing by certified accounting co.Tax report is done every month.

For sole proprietorship you do your own balance sheet.You only submit your tax report once every 6 months.

To know more,it's better to secure the service of an accounting firm.

They'll be able to advise you on everything including workpermit,visa and so forth.

They also provide service for company registeration and all of the above.

Goodluck !

[blizzard]

give us the details on yr grand opening. free advertising here!

sgthai could always use a good massage as he states he visits poseidon massage parlour regularly.

[Yimmy]

Thanks. Especially PA and SGT.

[Jersey_UK]

Either your g/f must go for the course to get one or one of your trainer possess a qualify massage certificate.You'll have to hang it up for authority's check whenever they come around.

So am I right is saying that this required for all Massage places, both "Traditional" and "Monkey Business"?

And secondly, that for a "Monkey Business" massage parlour that no official licence is required, only a "licence" from the local "Powers that be"?

Just curious

[sgthai]

Either your g/f must go for the course to get one or one of your trainer possess a qualify massage certificate.You'll have to hang it up for authority's check whenever they come around.

So am I right is saying that this required for all Massage places, both "Traditional" and "Monkey Business"?

And secondly, that for a "Monkey Business" massage parlour that no official licence is required, only a "licence" from the local "Powers that be"?

Just curious

Hi Jersey_UK,

All traditional massage parlour needs to have a qualify massage certificate.

These I know is a fact as I've many friends who are owners in these business.

As for the "monkey business" massage ....I guess maybe you are referring to the turkish bath type.

Those big massage parlour whereby the girls sit behind a glass panel and customer view and choose them.

It's an open monkey business if you ask me lol.

Anyway I've no idea or information on this turkish bath massage parlour license as I never enquire about it.

It should be legal ( subjective ) since there are so many big ones around especially along rachadaphisek road.

I can only provide information on those that I have come across or have friends in the same trade.

Sorry I'm of no help on this one mate

As for the police......hmm....this is thailand.....only the street wise will know.

Those going by the book to do their business will find it very tough to set up shop ( any trade ) because without kick back ( to u know who ) you will encounter lots of problem like registration,getting approval etc.

It's simply a sad fact mate.

As long as one is doing business in china,indonesia,philippines,thailand and even malaysia these are the unspoken rules.

Many farang will deems it as illegal but if one were to do it legally he'll find it is so much tougher getting around.He may even face many hassle along the way.

I guess to succeed in other country one will just have to follow the culture and street rules.

To avoid all sort of inconvienience one just have got to be smart. ( hey mr americanguy..do you get it !!! )

Edited July 22, 2007 by sgthai

[blizzard]

does anyone notice this guy only states the obvious. we know you have to pay to do busnit in thailand.

[lukez]

Yes sole proprietorship is only for locals.

To be secure you'll need to register a company with 7 partnership.51% thai and 49% foreign.

Minimum paid up capital.

Subject to auditing by certified accounting co.Tax report is done every month.

For sole proprietorship you do your own balance sheet.You only submit your tax report once every 6 months.

To know more,it's better to secure the service of an accounting firm.

They'll be able to advise you on everything including workpermit,visa and so forth.

They also provide service for company registeration and all of the above.

Goodluck !

"Minimum paid up capital."

What are the expenses compared to sole proprietorship? Any usefull links to find info about such parthership and practially how its done?

[Jersey_UK]

does anyone notice this guy only states the obvious. we know you have to pay to do busnit in thailand.

Obvious? possibly;

Interesting? certainly;

Helpful? yer never know................

All IMHO of course.

[sgthai]

"Minimum paid up capital."

What are the expenses compared to sole proprietorship? Any usefull links to find info about such parthership and practially how its done?

For paid up capital,you only pay 5000baht per million paidup.

You don't need to engage a law firm to do all these.

There are many accounting firm with services like registering company,visa application,work permit,annul tax return etc.

The cost for setting up a 7 shareholder partnership is around 12,000 baht if I remember corectly.Not inclusive of the 10k baht for a 2million baht paid up capital.

You can have a clearer picture if you talk to any of them.

I can recommend you a good acct firm if you like. Just pm me.

If not you can find many in the newsapaper and do some comparison.

It's important to find a firm that have many years of experience and knows alot of people ( authority) and they will be able to advise you accordlingly.

I've no problem with my work permit,annual tax,co. registration and visa extension.

[bazmlb]

You can always setup a limited partnership as well, its another option

[Soboringtochooseaname]

Hi,

When Thai open a shop, like souvenir or grocery shop they just open it and wait for someone to come and ask them to pay some tax or anything else. It seems to be no problem for them right ?

But if a wanted wanted to open a shop the right way, how should he do ? How much would it cost ? (in case of souvenir/small items shop)

And do you know if some buildings are not officialy made to be a shop or can you open a shop in any townhouse / building ?

Thanks for advice.

[Soboringtochooseaname]

Any info ?

[Nudels]

hi ...

I did the same some months before.

I paid for renew building and all the accommodation 10000€.

Now my girlfriend tells to me, she need 3500€ more for authority's check to hang up for 6 years.

She can buy this by her hirer. My question is:

Does anyone know, your hirer can do things like this?

Does anyone know, if he can, are the contract about 3 years enough?

THX

[farang000999]

lol

[outofoz]

hi ...

I did the same some months before.

I paid for renew building and all the accommodation 10000€.

Now my girlfriend tells to me, she need 3500€ more for authority's check to hang up for 6 years.

She can buy this by her hirer. My question is:

Does anyone know, your hirer can do things like this?

Does anyone know, if he can, are the contract about 3 years enough?

THX

bit late to be asking these types of questions if you have already stumped up the cash?

[zorro1]

just what thailand needs, another small massage shop. if your gf is hot you may be on to something.......lol.

can you tell me what you going to be doing behind the scene. not much to run , only few customers a day from what i see and these have prime sukhumvit locations.

"can you tell me what you going to be doing behind the scene. not much to run , only few customers a day from what i see and these have prime sukhumvit locations."

Thats what I thought, hardly much to do unless you have a large expensive looking day spa, for some reason farang like to pay 30% more if looks professional. The big massage place in my condo is always full at night and do a roaring trade but the 20 or so hole in the wall ,small massage places within a 100m walk are very quite, its a mystery how they survive

[Gers1873]

hi ...

I did the same some months before.

I paid for renew building and all the accommodation 10000€.

Now my girlfriend tells to me, she need 3500€ more for authority's check to hang up for 6 years.

She can buy this by her hirer. My question is:

Does anyone know, your hirer can do things like this?

Does anyone know, if he can, are the contract about 3 years enough?

THX

bit late to be asking these types of questions if you have already stumped up the cash?

It all sounds rather complex - hope the story has a 'happy ending'