Steps of company formation in Thailand

Thailand has an optimistic opportunity of setting up businesses. If you are a foreign entrepreneur and ready to roll on with your business idea, now is the time to move forward. But before that, good knowledge is necessary to start your company formation. In that case, S & F consulting firm comes into action. This particular business consulting firm has a strong history of consulting entrepreneurs. So, if you want to know in-depth about company registration in Thailand, now you know whom to contact.

According to Thai law, three particular company types are valid. These are:

1. Limited company
2. Sole proprietorship company
3. Partnership company

Among these three types, limited company is the most available type in Thailand. Particularly among foreign expats, this company category is quite popular. Thus, a major highlight of this article will fall on limited company.

1. In typical condition, a limited company requires at least three shareholders. among these three, two of them can be foreigners and the third person must be a Thai shareholder. Capital needed at this stage is at least 3,000,000 baht. In case of establishing a foreign company, the capital must be 2,000,000 baht. This minimal capital boundary has been set by the Ministry of Commerce of Malaysia. Once you fulfill these financial requirements, you are ready for the registration steps.

Registration steps for limited company

1.Registering the company name.

The first official task is to propose a unique company name. the name must not match with another currently existing or pre-existing business body. The name must have a suffix as "Limited". The approved name is valid for next thirty days. You must prepare your MoA and another registration document within that time. Those procedures will make your company name permanent.

2. Prepare MoA.

This is an agreement made by the directors of the company. This particular agreement includes the proposed name of the company, location of the company. The document will also include company objectives, company type, number of shareholders. also included are the credential of shareholders and number of shares for each director. the document must enclose with signatures of shareholders and certified by two witnesses.

3. Conduct statutory meeting.

Once MoA submission is complete, conduct a statutory meeting. This meeting will build up an article of association of the company. The meeting will also clarify the amounts promoters will get and number of shares issued on them. Finally, the meeting will appoint the first director and auditor for the company.

4. Draft all registration documents and submit for incorporation

Next you need is company corporation certificate. Upon submitting drafted registration form you can carry out the progress of this stage. The Ministry of Commerce or MOC handles this paperwork. You must submit all the registration papers along with MoA to the ministry of Commerce. You need to give data about your number of ordinary and preferred shares in the form. the form will also take the information of your money already paid on each share. It will also ask for each director's credentials and company's proposed address.

5. Apply for income tax, social security, business license and VAT certificate.

At this point it would be wise to apply for all your work permit and business visas if you are a foreigner. Without that you have to handle the company from overseas. To run the company, you also need to apply for income tax, VAT certificate and business license. These are compulsory once starting a company. you will also need a social security card while residing in Thailand for company purpose.

6. Apply for additional license if required

Some other licenses might be necessary in special case. for instance, if you are opening a restaurant you must have legal license for serving alcohol. you will also need license if planning for export import businesses. required license is necessary in case of pharmaceuticals and health care related trades. You can apply for those licenses from ministries of Thailand. Registering for these licenses need copies of company bank accounts and other credentials. You can also get useful advice from S & F consulting firm on these licenses.

7. Arrange company address, office furniture and utilities.

In Thailand you will get two choices on setting up business premises. Either pre-furnished serviced office of traditional office. Serviced office offers you with all utilities and furniture pre-arranged. All you need is your personal pc and office documents. The traditional office on the other side is all empty at the beginning. Consider buying all office furniture and utilities to decorate the office from scratch.

8. Apply for business visa and work permit

If you are from other country and are planning to do business, get your business visa and work permit. You can process your own visa and permit. If needed, consider hiring lawyer to process work permit and corporate visa. Generally Thai embassy process this type of visa. For business visa you will need to place following document:

1. Letter from the local labor ministry
2. Letter from the Thai partners from your company
3. Company registration copy

To be eligible for the work permit you need at least four Thai workers working under you in the company. You will also need a capital of 2 million baht. It needs more than a month to complete all the permit process.

9. Need to open a company bank account

If you've finished the company registration process, open a business bank account. You can choose any bank of your preference for this account. A native partner of your company should be present as reference for opening the account.

10. Hire employees for the new company.

At this point you need to publish circulars for hiring human resources for the company. You can publish hire notice on sites like Jobthai or Jobdb for better and faster responds. Such advertise usually charges you in monthly basis. You can offer staffs with fair wages, bonuses, meal, and scheduled leave opportunities. Maintain fair corporate policies for staff benefits to strengthen staff retention.

In case of Sole proprietorship, a company has only one single owner. The owner himself turns out to be the operator of the company. A foreigner can choose sole proprietorship. In that case incorporation gets complicated if company couldn't qualify at the beginning.

Thailand follows three criteria of partnership company recommended by Civil and Commercial Code. These are:

1. Registered ordinary partners
2. Unregistered ordinary partners
3. Limited partners.