Crackdown on foreign nominees, changes to the Foreign Business Act

[tonbridgebrit]

All this talk about ASEAN bringing in major changes, and how it means that Thailand will have to compete with it's ASEAN members, and how it will lose out is, I think, a load of nonsense.

ASEAN is nothing like the European Union, it's all exaggerated talk and bluster, and basically, nothing much is going to change.

No, it doesn't mean that everybody in Burma is free to apply for a job in Singapore or Thailand, and then fly or go there by bus. And I doubt very much it means that every man in the Phillippines is free to fly to Singapore or Thailand and set up a company.
I think the newspapers are making it look like that ASEAN has been set up to rival and challenge the European Union, maybe ASEAN is banging a drum to make itself look like the European Union. It certainly is not though.

[useronthenet]

I gave up doing business in Thailand ... it's too Alien !

[tonbridgebrit]

For people who have set up companies in Hong Kong and China, well, is it really easier to make money in those places than it is to make money here in Thailand ?

I know a few people who have tried to do business in Hong Kong and China. They seem to say that it's not actually easy. Comments like 'the system is rigged so that foreigners are at a disadvantage, especially if you're not a big company". And it might be the case that it's harder to spot small foreign owned businesses in China and Hong Kong than it is in Thailand.

Is that because not many individuals from Europe and America have opened up small businesses in those places ?

[pisico]

On second thought, maybe England, France or the US should have colonized!

INDEED !!!

Japan occupied Thailand for 2 years and obviously Thais did not learn much from the Japanese. Instead, Thais let them set up a hard labor camp (Khanchanabury) and start building a railroad to Burma. Thais also offered R and R to the tired Japanese soldiers (wink, wink, nudge, nudge).

Recently, commenting on the importance of ASEAN and that English would be a common bond between the country members, a proud Thai girl said to me when I questioned the apathy of Thais in general towards learning English: "Thailand is not a colony to a foreign nation." Verbatim translation from Thai.

OK to the Japanese occupation but no, no to learn a language spoken by 5 billion people in the world? The essence of Thainess!

Xenophobia, xenophobia uber ales!!!

[Thai at Heart]

For people who have set up companies in Hong Kong and China, well, is it really easier to make money in those places than it is to make money here in Thailand ?

I know a few people who have tried to do business in Hong Kong and China. They seem to say that it's not actually easy. Comments like 'the system is rigged so that foreigners are at a disadvantage, especially if you're not a big company". And it might be the case that it's harder to spot small foreign owned businesses in China and Hong Kong than it is in Thailand.

Is that because not many individuals from Europe and America have opened up small businesses in those places ?

No one said doing business was easier. Setting up and administering a business is easier.

[RandomSand]

Then I can probably use my Singapore or Malaysian incorporated company to gain a majority share in certain businesses in Thailand. It will remain to be seen wether they will honor this or it will be same same.

They could say that pan-ASEAN shareholding using holding companies, or whatever, constitutes majority ownership by non-ASEAN shareholders.

[Arkady]

Foreign Business Act from 1999

Annex 3

Businesses in which Thais are not yet prepared for competition with Foreigners.

So after 15 years the Thai companies are still not become competitive.

What are the reasons probably?

Easy.

No competition, no progress

Not 15 years, 42. The 1999 FBA cut and pasted the same wording from the original Alien Business law of 1973 which was a revolutionary decree of a military dictatorship that didn't even bother with a legislature.

Actually nearly all the FBA is the same word for word as the older law word for word except the use of nominees or acting as nominees was made explicitly illegal in the FBA. The Thai chambers lobbied for tougher measures still in 1999, particularly against the use of preferred shares with unequal voting rights but the Dems didn't let that happen the same amendments were proposed under the military govt's in 2007 but didn't get thro NLA because they weren't tough enough for the reactionaries.

Seems the recidivists keep waiting for another military govt and then propose the same old amendments. Banking and insurance are restricted to foreigners under their laws, removing them from Annex IIO won't open them up to foreign investment.

[axact]

Won't it be fun when they get around to the companies that own land and rent it to their farang minority shareholders?

Never understood the mentality of not allowing some groups of foreigners (like say retirees) to own a limited amount of land, say a maximum of 1 Rai or even only 100 Wah would suffice. This would obviously be only for personal residence with tax penalties if sold within say 3 or 5 years to discourage property speculators misusing such a system. This would avoid a lot of these problems with Thai nominee shareholders being used and be good for Thailand by encouraging more genuine falang retirees to move here and bring in of course regular foreign currency.

Maybe as we now at last have an intelligent open minded and progressive Government (shows us all how sometimes democracy does not actually work as well), they may well read our TVF threads here on this issue and consider all the implications of making such a sensible move and actually bring in such legislation to allow a restricted and limited foreign land ownership for those who would qualify.

Why should any country sell its land to foreigners ?

Seems some countries that have done so own very little of their own country.

If you want security as a foreigner take a long lease.... if you dont like the law of the country you are living in then exercise your free will to go elsewhere.

[RandomSand]

Why should any country sell its land to foreigners ?

Seems some countries that have done so own very little of their own country.

If you want security as a foreigner take a long lease.... if you dont like the law of the country you are living in then exercise your free will to go elsewhere.

Exactly.

Seems like falang moan about their own homelands going to the dogs then expect other countries to effect the same changes!

Woof Woof!

Edited September 9, 2014 by RandomSand

[Upset]

All this shit about openning up the local market is just a smoke screen whereas these bastards are actaully making things more difficult for foreigners. I hope that even the rest of Asean should see these. What I cannot understand is countries like Laos, Vietnam, MAyanmar and Cambodia that allow Thais and Thai firms to invest in their countries. Don't these countries and their people have any shame or pride as Thais treat them in Thailand very badly. These countries should retaliate and treat thais the same way.

Most of thailand and the way thais treat thais is becuase of the farangs in the past sho showered them with monies, financial assistance and the know how, so really these farngs deserve what they get these days. Go lobby back to your goverments.

[bkkjames]

Won't it be fun when they get around to the companies that own land and rent it to their farang minority shareholders?

Never understood the mentality of not allowing some groups of foreigners (like say retirees) to own a limited amount of land, say a maximum of 1 Rai or even only 100 Wah would suffice. This would obviously be only for personal residence with tax penalties if sold within say 3 or 5 years to discourage property speculators misusing such a system. This would avoid a lot of these problems with Thai nominee shareholders being used and be good for Thailand by encouraging more genuine falang retirees to move here and bring in of course regular foreign currency.

Maybe as we now at last have an intelligent open minded and progressive Government (shows us all how sometimes democracy does not actually work as well), they may well read our TVF threads here on this issue and consider all the implications of making such a sensible move and actually bring in such legislation to allow a restricted and limited foreign land ownership for those who would qualify.

Why should any country sell its land to foreigners ?

Seems some countries that have done so own very little of their own country.

If you want security as a foreigner take a long lease.... if you dont like the law of the country you are living in then exercise your free will to go elsewhere.

I am not particularly worried that some Chinese investor is FedExing my homeland back to Beijing one acre at a time...

Sent from my LG-P970 using Thaivisa Connect Thailand mobile app

[PJcm]

Foreign Business Act from 1999

Annex 3

Businesses in which Thais are not yet prepared for competition with Foreigners.

So after 15 years the Thai companies are still not become competitive.

What are the reasons probably?

Easy.

No competition, no progress

Which brings TOT,and True Vision to mi

Only fools invest in this country unless they have a deal like The Americans under the Treaty of Amity.

[jpeg]

As far as I know Western countries let Thai companies set up companies in their country would it not be fairer to let Western companies open here with full Western ownership. If you are a multi-million dollar company why would you want to have over 50% owned by foreigners in their own country. Thailand needs to start looking at the richest country in the world and fellow Asean member, Singapore, if Thailand wants to increase investment. I would never, never set up a company here with current rules.

I was recently in conversation with a Thai friend who'd recently returned from his bought and paid for house in the UK. He stopped abruptly, looked me in the eye and said 'I know, it's not fair, is it'. I hadn' said a word. But no, it's not bloody 'fair'.

But hey! The Thai developers busily chopping down the trees to build yet more overpriced oversupply developments in my area'll be happy. Not

Edited September 10, 2014 by jpeg

[pepi2005]

I was stunned when I did my paperwork to work in my job in Thailand and had to find out that it is impossible for foreigners to work on a self-employed basis, but that a company with Thai shareholders and 4-5 Thai employees has to be created (involving high costs and utterly complicated legal and accounting-related procedures)! UNBELIEVABLE , especially in a country where 95% of the people seem to work on a self-employed basis (which I think is great).

So amongst the things I had to put my mind on in order to work legally in Thailand was for me to think about what fantasy jobs an OFFICE (not at all necessary in my field of work, but still an obligatory requirement in Thailand) could potentially need: okay, an office probably needs a 'cleaning woman'. Then, although people make appointments with my only by calling me up in person, probably a 'phone call answering woman'. Then my head got stuck. I ended up in (formally) employing another cleaning woman and another 'phone call answering woman'. IT WAS JUST RIDICULOUS.

Edited September 10, 2014 by pepi2005

[TallGuyJohninBKK]

In addition, the department has found that seven firms involved in tourism and hospitality businesses controlled by the FBA have likely breached the law by having a nominee, through which foreign owners employ a Thai to hold a majority share in the firm.

The department is preparing to file the case with the Department of Special Investigation. The seven firms suspected of breaching the FBA are in tourism, restaurants, tour agencies, and property management. Most are in tourist-destination provinces, including Chon Buri, Chiang Mai, Trat and Phuket.

The Commerce Dept found SEVEN??? Really??? Spread out over at least four different provinces???

Wow!!! You can't get anything past those folks, who clearly at the sharpest tools in the shed...

[thamesiris]

I feel sorry for the poor farmers (not the local profiteers) - who will inherit very little of the economic miracle (??) of foreign investment.

The little guy and his wife and kids who always get the rough end of the stick.

Besides where can property speculation take you? Look at London now - if you're not on the property ladder you're stuffed. If you do have property, they'll get you in taxes in the end.

So, I don't believe all this - creating jobs for local people bs. Like some other guy was saying, you stop people being self-sufficient, and make them dependant on you...unless that is your agenda. The only way the system continues to work is by further resource or people exploitation...where does it end exactly? Why not learn to cultivate your own soil, and raise some chickens to feed your kids, instead of taking away someone else's ability to do so in the name of development...development for whom exactly?

It makes me sick, and if you want to delete my post, go on ahead, you can't stop me thinking.

[Whyamiandwhatamidoinghere]

Well to take them at their literal word they are going to make it easier for foreigners the problem for most of us is we are not from the countries they are gearing this to.

Did you think a foreigner was a Farang?

[Whyamiandwhatamidoinghere]

The Asian Pact is Thai land's "Self Sufficiency Theory" personified. They don't need western companies they have China.

[Whyamiandwhatamidoinghere]

We "Farangs" act like stepchildren trying to get Thailand to accept us and treat us fairly. Don't hold your breath because you will get dead first.

[Whyamiandwhatamidoinghere]

Oh and after you are dead and gone they will ship your body back to your country because you can't be buried in a country where you can't own land. Where can you buy a funeral plot? Even that piece land you can't own and they surely not going to trust your dead ass with a 99 year lease.

[Whyamiandwhatamidoinghere]

Welcome to communist Thailand where Democracy is Dead and martial law is the Constitution.

[Tomtomtom69]

With 2015 at the treshold it may be a good step for Thailand to start thinking about rewriting stale laws about owning land and businesses. Not doing so would put Thailand in a pretty bad compative situation and in the end not an attractive country to invest.

I agree, but as stated above I do not think that they would do so given how many millions of ASEAN nationals would be more than happy to get their hands on Thai land, if they could. Also, IF the laws were re-written, one would also hope that they are meant for everybody, not just ASEAN nationals. It wouldn't make sense or be fair if only ASEAN nationals would benefit, when clearly Thailand is of more interest to ASEAN nationals than to foreigners from other countries anyway and therefore you'll obviously have far more ASEAN nationals present in Thailand than non-ASEAN foreigners (has always been this way, although the Chinese are coming in big numbers now but as already mentioned, the threat they present is one more reason why I don't think it will be easy for Thailand to relax foreign land or even business ownership restrictions, especially not the former).

Sorry, but the acronym A.S.E.A.N. is quite specific, and with exception of the Russian expats of SE Asia, the rest of the Western Expat population (American & British, in particular), do not possess the busines solidarity acumen to circumvent the dictated stipulations of the coming ASEAN umbrella reality. 50+ years of (socially fragmented) expat history, confirms those facts to be true.

I have no idea what you mean - ASEAN refers to the 10 nations of SE Asia, not China, not Russia, not India, none of those. My point was simply that firstly, there is nothing to suggest that ASEAN nationals will be able to more easily invest or own land after the implementation of AEC and I don't see why they should. Westerners, or Africans or whoever, anyone not from the region never has been and probably never will be present in Thailand in large enough numbers for Thailand to be concerned about them. There are easily 10-20 times more ASEAN nationals in Thailand, for either tourism or working here than the combined total of all western, African and other non-ASEAN nationals, with the exception of the Chinese who have started to come in large numbers for tourism.

It doesn't matter where you come from, if you want to do business in Thailand you have to know the rules. Westerners are far less likely to offer bribes, Russians, Chinese will happily bribe their way out of trouble or to overcome "difficulties".

[Tomtomtom69]

Oh and after you are dead and gone they will ship your body back to your country because you can't be buried in a country where you can't own land. Where can you buy a funeral plot? Even that piece land you can't own and they surely not going to trust your dead ass with a 99 year lease.

That's an interesting question. But let me answer it for you. While I don't want to talk about the inevitable, about death in general, I'll give you some insights into what happens in Thailand after someone passes away. The vast majority of Thais (Buddhists that is) are cremated and don't have a burial plot. The remaining ashes are scattered over dams, rivers, other natural bodies of water or perhaps the forest or other pieces of land. Cemeteries and actual graves are rare. About the only graves or cemeteries I've seen in Thailand belong to deceased individuals of the Muslim faith, or perhaps Christian faith (although those are exceptionally rare but may be located inside church grounds). The other cemeteries in Thailand that I'm aware of is the Commonwealth soldiers cemetery in Kanchanaburi. However, as even Thais don't have burial plots (for the most part) although some Thais have their ashes interned inside stupas at Wats, many, if most don't. Otherwise there would have to be a large amount of land devoted to stupas and that clearly isn't the case. Generally only prominent individuals or those who have a strong connection with their Wat end up having their remains interned inside stupas. For everyone else, their view is that the end is the end, and no attempt seems to be made to make a physical location for deceased individuals remains, in order to allow families to come back and visit. This is something I'm personally not comfortable with.

No idea about what happens to a foreigner who wants to be buried in Thailand but clearly it isn't the same as back home, or even in Vietnam, where the remains of most deceased individuals are interned inside some sort of grave, irrespective of the method of disposal (burial or cremation). In Vietnam, cemeteries are everywhere, in farmers rice fields, any vacant land and the vast majority of dead are buried. They also practice after death rituals such as tomb sweeping. It is deeply moving and I respect the Vietnamese attitude towards keeping the memories of their deceased alive, by worshiping long dead ancestors.

Personally I'm not a fan of cremation and disposal of remains onto a public area, just like you would do with waste. But each to their own I think.

Anyway, I hope my post gave you some further insights, although it's not definitive in terms of what would happen to a deceased foreigner who wants to be buried in Thailand, but I can imagine that from a Thai point of view the idea of a western or even Vietnamese style burial plot is very different from their own.

Edited September 18, 2014 by Tomtomtom69

[Nickymaster]

Welcome to communist Thailand where Democracy is Dead and martial law is the Constitution.

Was democracy ever alive in Thailand? I know there was some voting and so on but surely there is more to democracy, right?

[BernieOnTour]

... This would obviously be only for personal residence with tax penalties if sold within say 3 or 5 years to discourage property speculators misusing such a system...

IMHO discourage speculation is exactly, what they do not want... It is more something like:

1) Keep the profits of driving property prices sky high in the pockets of the most influential group, the Thai-Chinese.

2) ASEAN? - ensure that clan members and friends of the influential groups in the neighboring countries (as Chinoys, Malay Chinese, Indonesian Chinese...) can fill their pockets further at the expense of the indigenous people and make sure that the bl..dy Kanos, Farang, or whatsoever you call them, have no chance to get the skimpiest share of it

Edited October 12, 2014 by BernieOnTour