Business Activities that Foreigners Cannot Fully Own Under the BOI Promotion
According to Thai laws, foreign investors who wish to establish a business in Thailand are restricted to the percentage of foreign shareholding allowed in a Thai company. A Thai company requires Thai nationals to hold the majority of its shares. Otherwise, the company is considered as a foreign own company and required to obtain for Foreign Business License before the company is able to commence in any business activities in Thailand.
In case the company is approved the BOI promotion, BOI privileges override the mentioned restriction and allow foreign investors to acquire a higher percentage of shares in the BOI promoted business activities. However, projects in agriculture, animal husbandry, fisheries, mineral exploration, and mining must be operated by a Thai company in which Thai nationals hold shares totaling not less than 51 percent of the registered capital.
BOI promoted activities, where the business cannot be fully owned by foreign investor, are as follows:
Section 1: Agriculture and Agricultural Products
- Plant propagation and development
Section 2: Mining, Ceramics and Basis Metals
- Mineral ore prospecting
- Mining or ore dressing
- Marble or granite mining
Section 4: Metal Products, Machinery and Transportation Equipment
- Manufacture of 4-stroke motorcycles
Section 7: Service and Public Utilities
- International Trading Companies
Bear in mind that the Board of BOI still reserves the right to set the number of shares eligible to be held by foreign investors on any promoted projects where deemed appropriate.
About the Author (Author Profile)
Nattaporn Pareeratanasomporn is a Legal Advisor for Siam Legal specializing in Corporate Law. She is a graduate of Washington College of Law in Washington, D.C., and Thammasat University in Bangkok. She earned a Bachelor of Law in 2004, and a Master of Law in International Business Law in 2007. Her fluent languages include Thai and English.