Foreign Business License & 100% Foreign-Owned Company

Foreign Business License in Thailand:
Achieving 100% Foreign Ownership   

Foreign investors often encounter limitations when establishing businesses in Thailand, primarily due to restrictions on foreign ownership. Typically, foreigners can own up to 49% of a Thai limited company. However, obtaining a Foreign Business License (FBL) offers a pathway to surpass this limitation, allowing for majority or full foreign ownership in certain sectors.

Understanding the Foreign Business License (FBL)

The Foreign Business License is a permit issued under the Foreign Business Act B.E. 2542 (1999), enabling foreign entities to operate businesses that are otherwise restricted to Thai nationals. This license is essential for foreigners aiming to hold more than 49% ownership in a Thai company.

Eligibility Criteria for FBL Application

Applicants must meet specific qualifications:

• Age: At least 20 years old.
• Residency: Hold a residence in Thailand or have been granted temporary entry under immigration laws.
• Legal Standing: Not be an incompetent or quasi-incompetent person.
• Financial Status: Not be bankrupt.
• Criminal Record: No history of offenses under the Foreign Business Act or related regulations within the past five years.

Business Activities Requiring an FBL

The Foreign Business Act categorizes business activities into three lists:

 List 1: Activities strictly prohibited to foreigners (e.g., newspaper publishing, land trading).

 List 2: Activities related to national security or culture, requiring Cabinet approval for foreign participation.

 List 3: Activities where Thai nationals are not yet ready to compete, requiring permission from the Director-General of the Department of Business Development with the approval of the Foreign Business Committee.

Common sectors where an FBL is applicable include:

• Retail and wholesale trade.
• Hospitality and tourism services.
• Education and training institutions.
• Real estate and property development.
• Advertising and media services.

Application Process for an FBL

1. Determine Business Activity Classification: Identify if your intended business falls under List 2 or 3 of the Foreign Business Act.
2. Prepare Required Documentation: This includes a detailed business plan, financial statements, proof of capital, and personal identification documents.
3. Submit Application: File your application with the Department of Business Development (DBD) under the Ministry of Commerce.
4. Review Process: The DBD, along with relevant authorities, will review your application. Approval timelines can vary based on the business activity and completeness of documentation.
5. Obtain License: Upon approval, the FBL will be issued, granting legal permission to operate the specified business in Thailand.

Benefits of Holding an FBL

• Full Ownership: Allows for up to 100% foreign ownership in approved sectors.
• Legal Compliance: Ensures adherence to Thai laws, reducing the risk of legal complications.
• Market Access: Enables entry into sectors otherwise restricted to Thai nationals.
• Enhanced Credibility: Demonstrates commitment to operating within Thailand's legal framework, fostering trust with partners and customers.
  

Apart from the FBL, foreign investors may consider:

• Board of Investment (BOI) Promotion: Offers incentives and allows full foreign ownership in promoted sectors.
• Treaty of Amity (U.S. Investors): Permits American citizens and companies to hold majority ownership in certain businesses.

Special Advantage for U.S. Citizens: The U.S.–Thailand Treaty of Amity

The Treaty of Amity and Economic Relations between the United States and Thailand, signed in 1966, provides a unique advantage to American investors.

Under this treaty:

 U.S. citizens and companies can own 100% of shares in a Thai company (with some exceptions in restricted sectors like communications and transportation).

 No need to obtain a Foreign Business License for most service-based businesses.

 Only two shareholders are required, and a majority of directors must be American citizens.

 The process is faster and more straightforward than the standard FBL route.
This makes the Treaty of Amity an excellent pathway for American entrepreneurs and corporations looking to enter the Thai market with full ownership and legal control.

How Prime Consulting Can Assist

Navigating the complexities of obtaining a Foreign Business License can be challenging. At Prime Consulting Co., Ltd., we specialize in guiding foreign investors through the FBL application process, ensuring compliance and increasing the likelihood of approval.

Our initial consultation shall be for free of charge.  So please do not hesitate to contact us to find out how we can provide you with the best solution that perfectly fits for your requirements.

or CLICK HERE to find our list of standard fees

Call 065-409-3229 or 065-409-3292

 Line: @hyn7534s

  WhatsApp: +66654093229

 1201/15 Soi Ladprao 94 (Panjamitr), Plubpla Sub-district, Wangthonglang District, Bangkok 10310 THAILAND

ดำเนินงานโดย
บริษัท ไพร์ม คอนซัลติ้ง จำกัด
เลขที่ 1201/15 ซอยลาดพร้าว 94 (ปัญจมิตร) แขวงพลับพลา เขตวังทองหลาง กรุงเทพมหานคร 10310
โทร 02-430-2625
email: karankorn@primeconsulting-th.com