Opening A Company In Thailand

[annajunghans]

Hello all,

Myself, my husband are wanting to open up a business in Thailand, we have found it hard to get any concrete information so far. I'm hoping you can help or guide us in the right direction. So far we have received the following information, we have been unable to verify this information and have questions about it.

If you could clear some of the questions up or provide other guidance that would be much appreciated. We are unsure as to how our business venture would be classed as. Do you have any idea as what our business would be classed, or know where to find out?

My husband will be running an IT company 90% of the time, and maybe 4 or 6 times a year we want to take Australian travellers through Thailand and offer them a 10 day adventure trip, including boot camps (I'm a personal trainer myself), cycling, rafting, climbing etc. Does that class us as a Tour Operator?

And do we need to open two companies since its two different areas? If we need to be classed as a tour operator, would it be to our advantage being classed as one?

If we operate as a tour operator and have to appoint a Thai manager who manages finances and the staff, do we then lose control over the business (we've been told we have to appoint a Thai manager)? Once we operate a company, do we still need to leave the country on a regular basis? Thanking you in advance.

Kind regards

[midasthailand]

Hello all,

Myself, my husband are wanting to open up a business in Thailand, we have found it hard to get any concrete information so far. I'm hoping you can help or guide us in the right direction. So far we have received the following information, we have been unable to verify this information and have questions about it.

If you could clear some of the questions up or provide other guidance that would be much appreciated. We are unsure as to how our business venture would be classed as. Do you have any idea as what our business would be classed, or know where to find out?

My husband will be running an IT company 90% of the time, and maybe 4 or 6 times a year we want to take Australian travellers through Thailand and offer them a 10 day adventure trip, including boot camps (I'm a personal trainer myself), cycling, rafting, climbing etc. Does that class us as a Tour Operator?

And do we need to open two companies since its two different areas? If we need to be classed as a tour operator, would it be to our advantage being classed as one?

If we operate as a tour operator and have to appoint a Thai manager who manages finances and the staff, do we then lose control over the business (we've been told we have to appoint a Thai manager)? Once we operate a company, do we still need to leave the country on a regular basis? Thanking you in advance.

Kind regards

My understanding is that you and your husband cannot operate as tour guides, you can own the company, but must employ Thai nationals as the tour guides. I have spent several years trying to come up with a suitable model for the type of tour I want to operate in Thailand and have found that it can only be done if you have good contacts amongst Thai nationals. Having said that, I would encourage you to have a go, bearing in mind that the salaries you would be paying to Thai staff are not going to cut into your bottom line too much.

[A_Traveller]

There is no need for two companies, unless that route suits your purposes {It may as you look into this further}. The off-the-shelf company 'memorandum and articles, {I can never remember what they are called in translation here, sorry} should be automatically drafted to let the company perform a wide range of activities. However, you would need to register for licencing {which is subject to fees and a, returnable upon business cessation, bond} as a Tour Operator.

The customer facing staff must be Thai if they provide 'guide' services, which it would seems is be loosely defined, therefore I would anticipate that you would be gainfully employed {for WP purposes} by the IT element, and be 'technical consultants' to the tour side.

Regards

/edit typo//

Edited October 3, 2007 by A_Traveller

[Sunbelt Asia]

And do we need to open two companies since its two different areas? If we need to be classed as a tour operator, would it be to our advantage being classed as one?

You only need one company

If we operate as a tour operator and have to appoint a Thai manager who manages finances and the staff, do we then lose control over the business (we've been told we have to appoint a Thai manager)?

Not required

Once we operate a company, do we still need to leave the country on a regular basis?

Until the company files an annual audit that shows previous years gross sales higher than the foreign salaries for the current year. Must meet other criteria as well such as 4 Thai employees per work permit to get the extension of stay based on business. No such requirement for the work permit.

www.sunbeltasiagroup.com

[jstumbo]

And do we need to open two companies since its two different areas? If we need to be classed as a tour operator, would it be to our advantage being classed as one?

You only need one company

If we operate as a tour operator and have to appoint a Thai manager who manages finances and the staff, do we then lose control over the business (we've been told we have to appoint a Thai manager)?

Not required

Once we operate a company, do we still need to leave the country on a regular basis?

Until the company files an annual audit that shows previous years gross sales higher than the foreign salaries for the current year. Must meet other criteria as well such as 4 Thai employees per work permit to get the extension of stay based on business. No such requirement for the work permit.

www.sunbeltasiagroup.com

I am assuming that you are not US citizens? If I understand it correctly then, you can only own 49% of the company the other 51% has to be owned by Thai nationals.

[Sunbelt Asia]

I am assuming that you are not US citizens? If I understand it correctly then, you can only own 49% of the company the other 51% has to be owned by Thai nationals.

This is correct unless they go BOI for the IT part, then it could be 100% foreign owned. For the tour operator this would not qualify under the BOI.

www.sunbeltasiagroup.com

[annajunghans]

My understanding is that you and your husband cannot operate as tour guides, you can own the company, but must employ Thai nationals as the tour guides. I have spent several years trying to come up with a suitable model for the type of tour I want to operate in Thailand and have found that it can only be done if you have good contacts amongst Thai nationals. Having said that, I would encourage you to have a go, bearing in mind that the salaries you would be paying to Thai staff are not going to cut into your bottom line too much.

Hi, thanks for your reply. We won't give up yet, I'm sure there is a solution for us to run it the way we want ;-) If we just keep asking and looking.

[annajunghans]

There is no need for two companies, unless that route suits your purposes {It may as you look into this further}. The off-the-shelf company 'memorandum and articles, {I can never remember what they are called in translation here, sorry} should be automatically drafted to let the company perform a wide range of activities. However, you would need to register for licencing {which is subject to fees and a, returnable upon business cessation, bond} as a Tour Operator.

The customer facing staff must be Thai if they provide 'guide' services, which it would seems is be loosely defined, therefore I would anticipate that you would be gainfully employed {for WP purposes} by the IT element, and be 'technical consultants' to the tour side.

Hi, thanks for taking the time to reply.

We were thinking about buying a shelf company, I guess we just need to make sure we can change the activities for the company.

Are there any advantages to register as a Tour Operator?

I mean, what happens if we do not register as a Tour Operator?

What is the criteria for a Tour Operator, when does one become one?

The Tour side of things will be more of a hobby for us, and we'll only do it 4 or 6 times a year for 10 days or so.

Thanks in advance

[annajunghans]

Hi, thanks for your reply.

You only need one company

OK, we'll probably buy a shelf company form one of the companies advertising on this forum.

If we operate as a tour operator and have to appoint a Thai manager who manages finances and the staff, do we then lose control over the business (we've been told we have to appoint a Thai manager)?

Not required

You mention it is not required to employ a Thai manager if we operate as a Tour Operator, however, earlier in this discussion it is mentioned that we do. How do I decide who is right?

Once we operate a company, do we still need to leave the country on a regular basis?

Until the company files an annual audit that shows previous years gross sales higher than the foreign salaries for the current year. Must meet other criteria as well such as 4 Thai employees per work permit to get the extension of stay based on business. No such requirement for the work permit.

OK, from your reply I understand that we do need to leave the country on a regular basis (every 3 months?) until we show that the previous gross sales were higher than the current foreign salaries.

We need to employ at least 8 Thai people (One work permit for me and one for my wife).

Do these Thai people need to be full time or can they be part time? Can they work as house keepers or do they need to be involved in the company.

I believe their wage would be around 10,000 bath a month, so that would cost us 960,000 baht a year to operate the company and have our work VISA.

[annajunghans]

I am assuming that you are not US citizens? If I understand it correctly then, you can only own 49% of the company the other 51% has to be owned by Thai nationals.

That is correct, I'm Dutch and my wife is Australian, we do have one fmaily member from the US who is retiring in Thailand this December.

[annajunghans]

This is correct unless they go BOI for the IT part, then it could be 100% foreign owned. For the tour operator this would not qualify under the BOI.

OK, I'm assuming you mean we should go here http://www.boi.go.th/english/

What exactly do we need to ask for to get the company 100% foreign?

I don't particularly want it to be 100% foreign, I will always want to employ Thai people, but prefer to have the option.

I'm still not sure exactly what it means to have 51% Thai shareholders, does it mean they get 51% of the profits? Do I need to communicate with them?

Thanks in advance.

[jstumbo]

This is correct unless they go BOI for the IT part, then it could be 100% foreign owned. For the tour operator this would not qualify under the BOI.

OK, I'm assuming you mean we should go here http://www.boi.go.th/english/

What exactly do we need to ask for to get the company 100% foreign?

I don't particularly want it to be 100% foreign, I will always want to employ Thai people, but prefer to have the option.

I'm still not sure exactly what it means to have 51% Thai shareholders, does it mean they get 51% of the profits? Do I need to communicate with them?

Thanks in advance.

51% owned by Thai nationals. Only 49% owned by non Thai nationals. That is why it kind of sucks because you have to have a Thai person or persons own more of the company than you.

Sunbelt knows best about how to structure all these things. It sounds like they are saying if you do the BOI route, you could own 100%.