Business setup & foreign ownership, in outline

Thailand welcomes foreign investment within a framework that reserves many business activities for Thai-majority companies unless you have a licence, treaty right, or investment promotion.

The company limited

• The standard vehicle is the private company limited: shareholders, directors, and registered capital divided into shares.
• Registration is at the Department of Business Development; companies file annual financial statements.
• Majority foreign-owned companies face the Foreign Business Act restrictions described below, which is why many trading and service companies in Thailand are structured as majority Thai-owned.

The Foreign Business Act

• The Act restricts majority foreign-owned companies from a long list of activities — most service businesses included — without a specific licence.
• Nominee shareholding used to dodge these restrictions is illegal and periodically enforced against. Genuine Thai partners, a licence, investment promotion, or an applicable treaty are the legitimate paths.
• Manufacturing for export is generally more open to foreign majority ownership than services.

Investment promotion

Thailand’s Board of Investment promotes targeted industries with incentives that can include majority or full foreign ownership, tax benefits and streamlined visa and work-permit processing. If your business fits a promoted category, it is generally worth investigating before defaulting to a majority-Thai structure.

Working legally: visas and work permits

• Working in Thailand requires a work permit in addition to the appropriate visa. Working without one is a criminal offence for both employee and employer — see visas & immigration and criminal matters.
• Standard companies generally need to meet capital and Thai-employee ratios per foreign work permit; promoted companies get relaxed rules.

Other rules that bite

• Contracts: bilingual contracts with a clear governing-language clause matter, since the Thai text usually controls in a Thai court — see contracts & disputes.
• Licensing beyond company registration: many activities need an additional sector-specific licence on top of basic company registration — check with the relevant ministry or local office before opening.
• Debt exposure: unpaid trade debts generally follow the same civil-claim path as personal loans — see debt & civil claims.

Company structuring, licensing and shareholder agreements are exactly the kind of decisions worth getting reviewed by a licensed lawyer before you commit capital.

Board of Investment promotion, in a bit more detail

The Board of Investment publishes categories of activity it wants to encourage — technology, targeted manufacturing, certain services — and grants promoted companies a package that can include majority or 100% foreign shareholding, corporate tax holidays or reductions, import duty relief on machinery, and eased foreign work-permit ratios. Applying is a formal process with its own paperwork and review timeline, not an automatic entitlement, and not every business fits a promoted category. It is worth an early conversation with a lawyer or a BOI-experienced adviser before assuming a standard majority-Thai structure is your only option.

Running the company day to day

• Annual filings — audited financial statements filed with the Department of Business Development, and corporate tax filings with the Revenue Department; see tax basics.
• Employing staff — written employment terms, statutory contributions and termination rules apply from the first Thai employee onward; see employment & labour law.
• Protecting your brand and know-how — a company name being accepted at registration does not itself give you trademark rights; see intellectual property basics.
• Director duties — Thai company directors owe duties of care and loyalty to the company, and can face personal exposure for certain breaches, including some tax and labour obligations if the company itself cannot pay.

Closing or selling a business

Winding down a Thai company involves a formal liquidation process, tax clearance, and settling obligations to employees and creditors before the company can be struck off the register — simply stopping operations without following this process leaves directors exposed to ongoing filing obligations and potential liability. Selling a business, whether as a share sale or an asset sale, raises its own due-diligence and tax questions on both sides; treat either exit as a transaction that needs a lawyer and an accountant, not a private handshake.