Solutions to Foreign Business Act Problems by Gregory Smyth
The Foreign Business Act first became part of Thailand law in 1999. However, it was seen that there were so many different ways to circumvent it that further amendments have now been enacted, in order to protect Thai businesses, while still attempting to allow reasonable influx of foreign currency and business opportunities in the country.
Since the amendments first began to be discussed, corporate legal services in Thailand have been inundated with requests to clarify the new Thailand law. Here a Thailand law firm looks at what is allowed under the amended Foreign Business Act, and what international law firms in Thailand will be advising their clients to do to comply with it.
Under the amendements to the Foreign Business Act (or FBA), the definition of a 'registered foreign company in Thailand' has been modified to include companies where more than half of the voting rights are held by foreign nationals.
Some companies will be required to modify their share structure under the new Thai law. Also, if your corporate legal service in Thailand advises you that your company is in violation of some of the Act's provisions, it is the company's responsibility to report it to the Director General of the Ministry of Commerce.
The company then rights the violation, under Thailand business legal service guidance, within one year from the date of reporting. The list of restricted businesses has increased, and also the penalties for violating the Thai law have been increased.
Previously, many foreign businesses would engage the paid services of a Thai nominee to hold a 51% or greater stake in the business on their behalf, voting and acting under their instructions. However, business legal services in Thailand now see this as a risky option for foreign owners.
It is now in violation of the new FBA Thai law - however, there are options that do allow foreigners to hold a majority stake or fully own a business in Thailand.
Alien Business Licences can often be the solution to foreign ownership problems. Business legal service in Thailand see this as working with the government, rather than exploiting their loopholes, and believe that this should impact favourably on the licensing body's decision.
If you complete the application under the guidance of international law firms in Thailand or corporate legal services in Thailand, you have a better chance of your application being accepted.
Foreign business owners should also remember that most manufacturing businesses do not have ownership restrictions under the FBA. While the list of restricted businesses has certainly increased, you should still check with your business legal service in Thailand before assuming that your business type will not be allowed foreign ownership.
Checking with your Thailand lawyer about the full scope of your business is also advisable, because if you engage in after-sales service or repairs, you are considered to be providing a prohibited service.
For nearly 30 years, Bamrung Suvicha Apisakdi Law Associates (BSA Law) has focused on providing reliable legal advice and services to the Thai and foreign business community in Thailand. We provide international standards of legal services while retaining the customs of the Thai business culture
Article Source: ArticleSnatch Free Article Directory
The Foreign Business Act first became part of Thailand law in 1999. However, it was seen that there were so many different ways to circumvent it that further amendments have now been enacted, in order to protect Thai businesses, while still attempting to allow reasonable influx of foreign currency and business opportunities in the country.
Since the amendments first began to be discussed, corporate legal services in Thailand have been inundated with requests to clarify the new Thailand law. Here a Thailand law firm looks at what is allowed under the amended Foreign Business Act, and what international law firms in Thailand will be advising their clients to do to comply with it.
Under the amendements to the Foreign Business Act (or FBA), the definition of a 'registered foreign company in Thailand' has been modified to include companies where more than half of the voting rights are held by foreign nationals.
Some companies will be required to modify their share structure under the new Thai law. Also, if your corporate legal service in Thailand advises you that your company is in violation of some of the Act's provisions, it is the company's responsibility to report it to the Director General of the Ministry of Commerce.
The company then rights the violation, under Thailand business legal service guidance, within one year from the date of reporting. The list of restricted businesses has increased, and also the penalties for violating the Thai law have been increased.
Previously, many foreign businesses would engage the paid services of a Thai nominee to hold a 51% or greater stake in the business on their behalf, voting and acting under their instructions. However, business legal services in Thailand now see this as a risky option for foreign owners.
It is now in violation of the new FBA Thai law - however, there are options that do allow foreigners to hold a majority stake or fully own a business in Thailand.
Alien Business Licences can often be the solution to foreign ownership problems. Business legal service in Thailand see this as working with the government, rather than exploiting their loopholes, and believe that this should impact favourably on the licensing body's decision.
If you complete the application under the guidance of international law firms in Thailand or corporate legal services in Thailand, you have a better chance of your application being accepted.
Foreign business owners should also remember that most manufacturing businesses do not have ownership restrictions under the FBA. While the list of restricted businesses has certainly increased, you should still check with your business legal service in Thailand before assuming that your business type will not be allowed foreign ownership.
Checking with your Thailand lawyer about the full scope of your business is also advisable, because if you engage in after-sales service or repairs, you are considered to be providing a prohibited service.
For nearly 30 years, Bamrung Suvicha Apisakdi Law Associates (BSA Law) has focused on providing reliable legal advice and services to the Thai and foreign business community in Thailand. We provide international standards of legal services while retaining the customs of the Thai business culture
Article Source: ArticleSnatch Free Article Directory