100% Foreign Ownership Of Thai Companies?

[nemo38]

I've been reading through the board of investment web site. It seems that 100% foreign ownership of companies is possible in Thailand outside of a list of restricted categories of business.

What is the situation in practice? Are they trying to shoe horn everyone into taking a Thai partner?

I'm not American. But would it be possible for me to take advantage of the US Amity treaty by opening a delaware company (US) and opening a Thai company through my delaware company? I could employ a couple of US directors, which would satisfy the requirement that a majority of directors must be US nationals.

[gzu88bv]

I've been reading through the board of investment web site. It seems that 100% foreign ownership of companies is possible in Thailand outside of a list of restricted categories of business.

What is the situation in practice? Are they trying to shoe horn everyone into taking a Thai partner?

I'm not American. But would it be possible for me to take advantage of the US Amity treaty by opening a delaware company (US) and opening a Thai company through my delaware company? I could employ a couple of US directors, which would satisfy the requirement that a majority of directors must be US nationals.

I have not heard of anything like this as yet. I might be totally wrong, but what I know of is a split of 51% Thai and 49% Foreigner and I dobut very much that this does change with a Delaware company. Shoot me if I am wrong!

[A_Traveller]

Is that still on the BoI site? The simple answer is that whilst under very specific constraints it is possible for a private company to be 100% owned by aliens {tin foil hats required?} these situations are as rare as hens teeth. I do know someone who was looking at the Delaware route, but he found the investment criteria {read barriers} sufficiently frustrating to choose another location for the business. In principal I don't see why a Delaware corporation could not create an Amity company {it's just another US domiciled legal entity after all} in Thailand, though with the exception of the 100% ownership such companies are still not permitted to operate in 'prohibited' ventures. Given the structural costs and complexities I'm not sure I see the benefits, excepting the ability further on to sell the operation as an entity to a US person/company.

Regards

[Bobcat]

The MOC will look at the shareholders of the Delaware company. If it is owned less than 51% by Americans it will not be considered a US company for the purposes of the Treaty of Amity. This applies to all corporate entities going up the chain.

[highdiver]

yes you can open a 100% forign held company. and it will be deemed as an alien.

if you do so through the BOI in promotioned investments and you can deal in related activities even if the FBA forbids them as BOI investments are exempted.

also through the BOI you get a 1 stop office to clear all the formalities of Visa, work permit etc..

if you invest through the BOI. then even though you are a forigner you can own your own land for residence purpose only not exceeding 1 Rai. the Boi are very efficiant handling this.

if you need more info fo to te BOI site look at the contact detail and speak directly to them.

they are very helpfull and will assist you.

good luck

[nemo38]

yes you can open a 100% forign held company. and it will be deemed as an alien.

if you do so through the BOI in promotioned investments and you can deal in related activities even if the FBA forbids them as BOI investments are exempted.

Thanks. I hadn't realised that BOI investments are exempt from FBA. Actually my investment won't be large enough to qualify. I believe the qualification is an investment of 10 million BHT and I will be under that ceiling.

[grtaylor]

The MOC will look at the shareholders of the Delaware company. If it is owned less than 51% by Americans it will not be considered a US company for the purposes of the Treaty of Amity. This applies to all corporate entities going up the chain.

Maybe I'm missing something here - what is so special about Delaware?

G

[nemo38]

Maybe I'm missing something here - what is so special about Delaware?

Delaware companies have very simple maintenance and reporting requirements. For example there is no need to submit accounts. No tax unless the company trades in the USA. It is simply a way to open a cheap company.

[LookSaMoon]

Maybe I'm missing something here - what is so special about Delaware?

Delaware companies have very simple maintenance and reporting requirements. For example there is no need to submit accounts. No tax unless the company trades in the USA. It is simply a way to open a cheap company.

Khun Nemo38

Is it the same as British Virgin Island?

[Sunbelt Asia]

I'm not American. But would it be possible for me to take advantage of the US Amity treaty by opening a delaware company (US) and opening a Thai company through my delaware company?

no

I could employ a couple of US directors, which would satisfy the requirement that a majority of directors must be US nationals.

51% of the Deleware shares must be owned by the Americans as well.

www.sunbeltasiagroup.com

[Carmine6]

Maybe I'm missing something here - what is so special about Delaware?

Delaware companies have very simple maintenance and reporting requirements. For example there is no need to submit accounts. No tax unless the company trades in the USA. It is simply a way to open a cheap company.

More than this, they have some of the most consistent legal rulings and favorable business laws in the US. Something like half of publicly traded US companies are Delaware corporations.

[nemo38]

>51% of the Deleware shares must be owned by the Americans as well.

Perhaps it would be easier to use the standard trick with voting rights in USA. Give 51% of the shares to an American but give them little or no voting rights. The Thais might be able to stop this in their own country but it would be more difficult for them to unravel the scheme if it were done in the USA.

Hmmm. Perhaps Thailand might be possible after all.

I am still actively looking at other countries.

[A_Traveller]

My own view is that a Delaware registered entity is American. It might however, have to show that its shareholding were majority American {though if it was a plc with marketed shares how would that be possible I wonder?, anyway as the poster has suggested the voting rights option might exist. Since the company would be 100% legal in the US it should benefit from the treaty, however, since the provision of such status is 'in the gift' of the authorities here, so it is possible that they could decline. Don't think they are required to give the reasons either.

I do wonder if the OP is approaching this from the wrong angle, I still don't see the benefit, given the complications, costs, management issues, that the 100% option provides great benefits except in the possible sale of business scenario I mentioned earlier. Further there are, upon occasion, known 'issues' when a 100% foreign entity tries to do business with local companies {or institutions} at times.

The OP is not really helping us to aid him, since the level of data provided is too sparse, {e.g. manufacturing, service provision?} though this may be for imagined commercial concerns.

As I've mentioned before I know those who have looked at this and decided either to go elsewhere, or set up a smaller venture here with a local partner, giving access to the marketplace {& WP if required] but minimising exposure to a corporate environment which is less accommodating for foreign investors.

Regards

/edit typo & clarifications//

Edited August 19, 2007 by A_Traveller