The Procedure of Company Formation in Thailand is divided into 5 steps:
The first thing you should do is to select the shareholders. If it is a private company there must be three or more promoters, while public companies are required to have at least 15 shareholders. The minimum age to become a shareholder is 22, and the person must be legally empowered to represent the interests of the company. The shares are divided equally among promoters at the formation stage. Later then, the shares can be sold to other people, and adopt an uneven distribution.
Filing the MA
The Memorandum of Association can be registered only after the registration with the Ministry of Commerce has been completed. When you file the MA, you need to pay for all shares. In case of companies with foreign capital, the government’s approval is required. In Thailand, the Memorandum of Association includes the name of the company, its location and its financial objectives, as well as the names of the shareholders.
The Statutory Meeting
Before registration, a statutory meeting is convened, where the by-laws are established and the board of directors is selected. The results of this meeting is later transmitted to the registration bodies.
The company is registered on the same day the MA is approved by the Ministry of Commerce. After the statutory meeting is convoked, you have 90 days to apply for the company’s registration.
Filing for VAT and Income Tax
After registration, you need to file a package of important documents to the Ministry of Commerce, including: the ID cards and the VAT certificates. The body dealing with this procedure within MOC is the Department of Business Development. Also, you need to file these documents to the Revenue Department in Bangkok.
Types of companies
The Thailand legislation distinguishes three types of companies: sole proprietorship, partnership and limited company.
Sole proprietorship is nothing else than the sole business ownership in the USA. Both companies have the same principle of operation, and are similar in many aspects, except for some legislation regulations specific to each country.
The Thai partnership resembles all partnerships around the world, with no particular features that would make it different from other countries. When registering a partnership, you have to choose either it is gonna be ordinary or limited. When it comes to limited company, it is based on the distribution of the capital in equal shares. The liability of the shareholders depends directly on how many shares they hold. he Ministry of Commerce is the state body that is in charge of the whole company formation process. In Thailand, people primarily choose to set up limited companies.
If you are a group of three people or more and have an initial capital of minimum 3 million baht you are eligible of opening a limited company. Foreigners can set up a limited company if they have at least 2 million baht.
There are many pitfalls and obstacles for foreign investors during registration stage. Our specialists will help you to form a company in Thailand smoothly.