Published On: Sun, Jun 16th, 2013

Foreign Business Act of Thailand

Foreign Business Act of ThailandOwnership of certain industries in Thailand is limited only to the country’s domestic market and foreigners are prohibited from owning the same. On March 04, 2000, the Foreign Business Act of Thailand which replaced the Alien Business Act came into force and it further classified business in Thailand into three categories.

In Thailand, the Foreign Business Act served as the primary law that administers foreign owned businesses in Thailand. The categories for these are listed below and are as follows:

Category A:

  1. Newspaper business, radio broadcasting or television station business;

  2. Rice farming, farming or gardening;

  3. Animal farming;

  4. Forestry and wood fabrication from natural forest;

  5. Fishery for marine animals in Thai waters and within Thailand specific economic zones;

  6. Extraction of Thai herbs;

  7. Trading and auctioning Thai antiques or national historical objects;

  8. Making or casting Buddha images and monk alms bowls;

  9. Land trading

Category B:

Group I: The businesses related to the national safety or security:

  1. Production, selling, repairing and maintenance of:

  1. Firearms, ammunition, gun powder, explosives;

  2. Accessories of firearms, ammunition, and explosive;

  3. Armaments, ships, air-crafts or military vehicles;

  4. Equipment or components, all categories of war materials.

  1. Domestic land, waterway or air transportation, including domestic airline business.

Group II: The businesses affecting arts and culture, traditional and folk handicraft:

  1. Trading antiques or art objects being Thai arts and handicraft;

  2. Production of carved wood;

  3. Silkworm farming, production of Thai silk yarn, weaving Thai silk or Thai silk pattern printing;

  4. Production of Thai musical instruments;

  5. Production of goldware, silverware, nielloware, bronzeware or lacquerware;

  6. Production of crockery of Thai arts and culture;

Group III: The businesses affecting natural resources or environment:

  1. Manufacturing sugar from sugarcane;

  2. Salt farming, including underground salt;

  3. Rock salt mining;

  4. Mining, including rock blasting or crushing;

  5. Wood fabrication for furniture and utensil production.

Category C:

  1. Rice milling and flour production from rice and farm produce;

  2. Fishery, specifically marine animal culture;

  3. Forestry from forestation;

  4. Production of plywood, veneer board, chipboard or hardboard;

  5. Production of lime;

  6. Accounting service business;

  7. Legal service business;

  8. Architecture service business;

  9. Engineering service business;

  10. Construction, except for:

  1. Construction rendering basic services to the public in public utilities or transport requiring special tools, machinery, technology or construction expertise having the foreigners’ minimum capital of 500 million Baht or more;

  2. Other categories of construction as prescribed by the ministerial regulations.

  1. Broker or agent business, except:

  1. Being broken or agent for underwriting securities or services connected with future trading of commodities of financing instruments or securities;

  2. Being broker or agent for trading or procuring goods or services necessary for production or rendering services amongst affiliated enterprises;

  3. Being broker or agent for trading, purchasing or distributing or seeking both domestic and foreign markets for selling domestically manufactured or imported goods in the manner of international business operations having the foreigners’ minimum capital 100 million Baht or more;

  4. Being broker or agent of other category as prescribed by the ministerial regulations.

  1. Auction, except:

  1. Auction in the manner of international bidding not being the auction of antiques, historical artifacts or art objects which are Thai works of arts, handicraft or antiques or having the historical value;

  2. Other categories of auction as prescribed by the ministerial regulations.

  1. Internal trade connected with native products or produce not yet prohibited by law;

  2. Retailing all categories of goods having the total minimum capital less than 100 million Baht or having the minimum  capital of each shop less than 20 million Baht;

  3. Wholesaling all categories of goods having minimum capital of each shop less than million Bath;

  4. Advertising business;

  5. Hotel business, except for hotel management service;

  6. Guided tour;

  7. Selling food or beverages;

  8. Plan cultivation and propagation business;

  9. Other categories of service business except that prescribed in the ministerial regulations.

The List under Category A specifies the businesses in Thailand that were limited to Thai nationals and are prohibited to be owned and controlled by foreigners. On the other hand, the list in Category B states the types of businesses that are limited to Thai nationals but may be owned by foreigners subject to the approval of the Board of Investments. The businesses under Category C on one hand can also be subjected to foreign ownership provided that the provisions of the Foreign Business Act are followed.

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