How to Establish a Regional Operating Headquarters in Thailand
A “Regional Operating Headquarters” or ROH or “regional office” refers to a Limited Company that is registered in Thailand in order to provide management and technical services to any enterprises in its corporate network. Normally, a multinational corporation will set up a regional office in order to manage its branch offices in the region. By creating the “ROH” structure and providing it with tax benefits, Thailand has positioned itself as a regional hub for international business.
In order to establish an ROH in Thailand, a multinational corporation must first register a Limited Company, which is the juristic entity with its capital divided into shares and managed by a board of directors. Although a multinational corporation may naturally desire that the shares of its ROH be held by enterprises within its corporate network, regulations issued by the Company and Partnerships Registrar’s Office prohibits juristic entities from being one of the initial promoters of a Thai Limited Company.1 Therefore, a multinational corporation must first appoint three of its representatives as the promoters of the Thai Limited Company. The ROH must be registered with the following corporate objectives:
- To provide management and technical services to enterprises in its network or to its branch offices whether in Thailand or abroad.
- To provide support services to enterprises in its network or to its branch offices whether in Thailand or abroad as to the following matters:
- General management, business planning and coordination
- Acquisition and sourcing of materials and components
- Product development
- Technical support
- Promotion of marketing and sales
- Regional personnel management and training
- Financial advice
- Financial and economic analysis and research
- Credit management and control
Once the ROH has been registered, the shares originally held by the promoters may then be transferred to foreign branch offices in its network. Furthermore, the activities of an ROH are considered “(21) Other service business”, under the Foreign Business Act of 1999, in which permission to operate must first be granted by the Director-General of the Department of Business Development.
If you have questions related to establishing a Regional Operating Headquarters in Thailand, please feel free to contact us.
1 Clause 4(1) of the Regulation of the Companies and Partnerships Registrar Central Office of 2011 Re: Registration of Companies and Partnership
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