ASEAN Comprehensive Investment Agreement

ASEAN Comprehensive Investment Agreement

On 26 February 2009, the economic ministers of the ten ASEAN member States signed the ASEAN Comprehensive Investment Agreement (the “ACIA”), which liberalized trade within ASEAN in the following fields:

  • Agriculture
  • Fishery
  • Forestry
  • Mining
  • Manufacturing

 

Pursuant to the terms of the ACIA, ASEAN nationals are able to operate foreign majority-owned firms in Thailand by applying for a Foreign Business Certificate according to Section 10 of the Foreign Business Act of 1999 (the “FBA”) in the following fields:

1. Mining on land or at sea
  • Up to 60% of shares may be owned by ASEAN nationals
  • Two-fifths of the board of directors must be Thai nationals
  • Debt-to-equity ratio must not exceed 3:1
  • Registered capital must be at least 3 million baht or any higher amount designated by Ministerial Regulations
  • Must obtain permission from the Ministry of Industry
2. Production of flour from rice or other agricultural products
  • Up to 100% of shares may be owned by ASEAN nationals
  • Registered capital must be at least 3 million baht or any higher amount designated by Ministerial Regulations
3. Cultivation of tuna fish in deep sea cages and cultivation of certain domestic breeds of spiny lobster

4. Cultivation of new breeds of onion seedstock
  • Up to 51% of shares may be owned by ASEAN nationals
  • Permission must be granted by the Ministry of Agriculture and Cooperatives
  • Registered capital must be at least 3 million baht or any higher amount designated by Ministerial Regulations

ASEAN nationals who apply for a Foreign Business Certificate must register as a juristic person under the Thai Civil and Commercial Code, such as a Thai Limited Company, Limited Partnership or Registered Ordinary Partnership. However, firms registered outside of Thailand may operate under the FCIA by holding the majority of shares in a firm registered in Thailand. A firm registered outside of Thailand holding such shares must be registered in an ASEAN member State must have over 50% of its capital owned by ASEAN nationals, and must have its board of directors occupied by over 50% with ASEAN nationals.

Further cooperation, liberalization of trade and foreign direct investment can help turn ASEAN into an agricultural and economic powerhouse as the region progresses into the future.

 

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Category: ASEAN, Business in Thailand, Company Registration

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Siam Legal is an international law firm with experienced lawyers, attorneys, and solicitors both in Thailand law and international law. This Thailand law firm offers comprehensive legal services in Thailand to both local and foreign clients for Litigation such as civil & criminal cases, labor disputes, commercial cases, divorce, adoption, extradition, fraud, and drug cases. Other legal expertise of the law firm varied in cases involving corporate law such as company registration & Thailand BOI, family law, property law, and private investigation.

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