Easier To Get A Thai Corp

[brahmburgers]

I don't know all the minutae, but here goes:

Months ago, I went to my Thai attorney and mentioned I'm ready to create a Thai Corp. I had done it before, 11 yrs ago, but cancelled that earlier corp (was too early for my business, not making money enough to pay taxes on it). So was starting again now from scratch. My attorney advised that I need to put a big chunk of cash in a Thai bank (I can't recall the precise minimum, but I think it was a million baht). I told him I invested nearly all I had on the new biz, so didn't have a million to put in the bank. Then his son, who's also an attorney, piped up and said there's a legal way to get the corp without the cash on hand. Here it is in a nutshell:

>>>> We've heard how a Thai corp with a farang has to be 51% Thai and 49% farang shareholders. In nearly all cases, it's also known that the farang pays 100% of the investment, and the Thais are proxies, but that's beside the point.

The requirement for the 51/49 split - is a big chunk of cash in the bank (guess who shoulders that?)

>>>> Maybe this is old news to T.Visaites, but apparently a farang can create the corp without putting big money in the bank, if he is willing to accept a lesser share or the corp, specifically; 39% for himself, and 61% for the Thai proxies (or real investors, whatever).

Anyhow, I signed the 55 papers, paid the 20 baht for registration (got the official stamps to prove it), paid attorney fees, got the Thai shareholders, and .....voila, my biz is legal.

Incidentally, friends advised I get trusted people I know to be shareholders. I told them, "just because I've known someone for awhile, doesn't mean they're necessarily more trustworthy than people I've met recently." To make a long story short, I wound up offering the shareholding positions to three college students who have been studying with me (related to the business I'm opening) for several months. I figured, why feel obliged to offer shares to older (and richer) Thais who may or may not be more trustworthy than these 20 year olds? I may regret it later, but that's just the way the cookie happened to crumble at this juncture.

If you want to know specs on my new biz (two tourist venues in Chiang Rai) contact me direct.

[BigJohnnyBKK]

I'm not sure how diligently the relevant laws are enforced, but it is definitely illegal for a foreigner to use non-genuine shareholder/promoters as "proxies". I do know that how diligently they are enforced varies a lot over time and of course how powerful your competitors and other interested parties are.

I'm pointing this out as a caveat for those interested in the topic, as well as a warning not to discuss your specific transgressions in public

As a general comment, using wealthier Thais makes it less likely that their ability to be genuine investors would be questioned.

Also, I thought it was standard practice for such proxies to execute a sales transaction on the stock, with the date and price able to be filled in whenever you need to switch to one of your "reserve" proxies in the event anyone shows themselves to be unreliable. If this no longer works for some reason, an update would be appreciated.

[REM]

If you are American, can't you open a company under the Thai/American Aminity Treaty and not worry about all this biz with Thai partners......but that's only for a specific nationality.

[brahmburgers]

I'm not sure how diligently the relevant laws are enforced, but it is definitely illegal for a foreigner to use non-genuine shareholder/promoters as "proxies".

Look closely at any applications by farang for Thai corporation status, and chances are 19 to 1 that the 'shareholders' didn't actually invest one satang.

I'm pointing this out as a caveat for those interested in the topic, as well as a warning not to discuss your specific transgressions in public.

What transgression? There is too much secrecy in the world, particularly among business people. Thai authorities want farang to be polarized in these matters, as it gives the authorities more power to manipulate.

If you are American, can't you open a company under the Thai/American Aminity Treaty and not worry about all this biz with Thai partners......but that's only for a specific nationality.

I've been hearing that for years, yet I believe the reality is; it applies to larger scale corporations. I believe it was written with big scale corps in mind (7-11, Pepsi, KFC, etc) and the requirements are too daunting and expensive for the little guy to fathom. If that's wrong, please let US know (pun intended). I'm American, btw.

[whybother]

If you are American, can't you open a company under the Thai/American Aminity Treaty and not worry about all this biz with Thai partners......but that's only for a specific nationality.

I've been hearing that for years, yet I believe the reality is; it applies to larger scale corporations. I believe it was written with big scale corps in mind (7-11, Pepsi, KFC, etc) and the requirements are too daunting and expensive for the little guy to fathom. If that's wrong, please let US know (pun intended). I'm American, btw.

My understanding is it applies to any US citizen.

[brahmburgers]

If you are American, can't you open a company under the Thai/American Aminity Treaty and not worry about all this biz with Thai partners......but that's only for a specific nationality.

I've been hearing that for years, yet I believe the reality is; it applies to larger scale corporations. I believe it was written with big scale corps in mind (7-11, Pepsi, KFC, etc) and the requirements are too daunting and expensive for the little guy to fathom. If that's wrong, please let US know (pun intended). I'm American, btw.

My understanding is it applies to any US citizen.

Please mention a specific SMALL business run by an American in Thailand which has benefited from that 'Amity' provision. Thanks.

Also; I'm mildly surprised that no one commented on the 39%(farang) and 61%(Thai) ownership of a Thai corporation which enables the farang to own his shares without the requirement of him having to park a large sum in a Thai bank.

Either everyone reading this already knows this (which is highly doubtful), or it's a big 'mai pen rai.'

[julesdick]

Also; I'm mildly surprised that no one commented on the 39%(farang) and 61%(Thai) ownership of a Thai corporation which enables the farang to own his shares without the requirement of him having to park a large sum in a Thai bank.

Either everyone reading this already knows this (which is highly doubtful), or it's a big 'mai pen rai.'

Mee too. Nobody going to comment on the 'no money in the bank needed' ?

[Superskunk]

Also; I'm mildly surprised that no one commented on the 39%(farang) and 61%(Thai) ownership of a Thai corporation which enables the farang to own his shares without the requirement of him having to park a large sum in a Thai bank.

Either everyone reading this already knows this (which is highly doubtful), or it's a big 'mai pen rai.'

Mee too. Nobody going to comment on the 'no money in the bank needed' ?

I`ve heard thats possible. A consulting company told me this "way" and even they said that you can change the share ratio later to 49/51 without the money in a bank.

...but there is anonther way:

You dont need the full sum in cash. You can pay 500,000 in cash to the company bank acc., 750,000 equipment transfered to the company (computers, machines, etc.) and 750,000 management services provided by sponsors. Now you got your 2 million biz.