reasonable and advisable business protection

[TTom911]

Hi, assume you want to start a web based business in Thailand, don't need any investment/money, can run in effect all critical/core operational business matters by yourself and all assets (software etc. in this case) is even not hosted in Thailand and also fully managed by yourself. Still, the laws of course require that a significant portion of stakeholders in the company you want to setup must be Thai (I don't want to argue or lament about that, coz that's the rules which we are not going to change). People to whom one is personally "attached" is often the first thought when it comes to deciding who shall become these "stakeholders"... Completely unknowns (like accountants, lawyers, etc.) would be a different approach...

Either way, both are a BIG jump into the unknown and without wanting to forecast any doom or gloom, things can, and all too often do not change for the better over time... I just want to take a realistic approach to this subject with no other, second agenda...

While all the "factual aspects" of the business (assets, IP, etc.) are well under control and protected as I described above, how should one go about when selecting who these other "stakeholders" in "your" business shall be and what practically relevant steps shall be taken so that you don't end up with the short end of the straw if push comes to shove?

Would be interested in practically relevant views and personal experiences to learn from.

[fletchsmile]

Go for people you trust.

In the event you don't know anyone a legal firm is probably the next best bet. At least they are bound by some form of legal ethics and code of conduct.

Minimize your risk by ensuring their shares are preference shares which pay a reasonable fixed rate dividend, but with limited/reduced voting rights, so you retain control of the company, but it is still a valid commercial business deal.

From a practical point of view you will also need Thai directors to sign things. Hence it can be easier if these people are also the preference shareholders. Legal firms again can do both too.

My Thai wife is a director and shareholder in this way. It came about thru the friendship and trust I have with other expat friends. They get the additional trust factor of myself in the equation, and my wife gets the added comfort that I know and trust the people from her perspective - bearing in mind it is also a risk to the Thai person.

My wife receives a monthly fee as well as annual fixed dividend at a good rate.

Cheers

Fletch

[TTom911]

Go for people you trust.

In the event you don't know anyone a legal firm is probably the next best bet. At least they are bound by some form of legal ethics and code of conduct.

Minimize your risk by ensuring their shares are preference shares which pay a reasonable fixed rate dividend, but with limited/reduced voting rights, so you retain control of the company, but it is still a valid commercial business deal.

From a practical point of view you will also need Thai directors to sign things. Hence it can be easier if these people are also the preference shareholders. Legal firms again can do both too.

My Thai wife is a director and shareholder in this way. It came about thru the friendship and trust I have with other expat friends. They get the additional trust factor of myself in the equation, and my wife gets the added comfort that I know and trust the people from her perspective - bearing in mind it is also a risk to the Thai person.

My wife receives a monthly fee as well as annual fixed dividend at a good rate.

Cheers

Fletch

Thanks, agree in principle. It is not that I am distrusting by nature but given that I am / we are in a totally different culture with (at least in my case) no firm "roots" or long-term friends/acquaintances it's a bit of a "shaky" situation... Hence my interest how others did approach this.

Thanks for your input !

[ericthai]

If this is not going to be in Thailand then why open a Thai company? Open an offshore company. If you are wanting to open a Thai company then you need to have someone you can completely trust. If you are from the US you can own the company 100%.

Good Luck!

[TTom911]

If this is not going to be in Thailand then why open a Thai company? Open an offshore company. If you are wanting to open a Thai company then you need to have someone you can completely trust. If you are from the US you can own the company 100%.

Good Luck!

Thanks, sure, I thought about "offshore" (and still considering Singapore/Hong Kong as the "main hub" for the operation), but operating in Thailand requires work permit, bank account, etc. etc. etc. and all that requires a company to also (not necessarily "only") be registered here.

Thanks !

[SheungWan]

Unless there is a physical need to set up the business in Thailand, why not take advantage of a British-based legal system and establish in HK?

[TTom911]

Unless there is a physical need to set up the business in Thailand, why not take advantage of a British-based legal system and establish in HK?

I thought about "offshore" (and still considering Singapore/Hong Kong as the "main hub" for the operation), but operating in Thailand requires work permit, bank account, etc. etc. etc. and all that requires a company to also (not necessarily "only") be registered here.

Thanks !