The US-Thai Treaty of Amity is extremely beneficial to American Citizens wishing to own or operate a Company here in Thailand. However, it is not a magic document and work permit obligations still need to be met.
It allows American companies to maintain a majority shareholding or wholly own their company, branch office, or representative office in Thailand. It also gives them ‘national treatment,’ meaning they are exempt from the Foreign Business Act restrictions.
Benefits
In general, a company that registers under the Treaty of Amity will not need to obtain a Foreign Business License. It will also be exempt from certain restrictions imposed on foreign investment in Thailand. This can be beneficial for companies looking to expand their business in Thailand or those who already have a presence there.
American businesses that want to take advantage of these benefits need to file specific paperwork. The documentation must prove that the business is majority owned by Americans and must be submitted to the Commercial Service Office at the Embassy.
Once registered, an American company will have the right to maintain a majority shareholding or wholly own its Thai operations. However, it can’t engage in the reserved businesses of communications, transportation, fiduciary functions, banking involving depository functions, land ownership or exploitation of land and natural resources. It must also pay a gratuity payment to civil servants responsible for regulatory oversight and enforcement.
Requirements
Treaty of Amity companies must be American legal entities or individual shareholders who own 51% of the shares (although this can be higher). These companies can conduct almost every type of business that is prohibited to foreign investors of other nationalities, except for domestic trade in agricultural products and exploitation of land or natural resources.
If a company wants to benefit from the US-Thai Amity Treaty of Amity, they must file specific paperwork with the Commercial Service Office. The CSO certifies these documents and sends them to the Thai Department of Commerce where they are registered as a foreign company with the Foreign Business Certificate.
The process is complex, so it’s wise to get help from a professional. Plizz can help you with all the necessary paperwork and ensure your application is successful. Contact us now to find out more about the benefits and requirements of setting up a US-Thai Amity Treaty. We can also advise you on your particular circumstances and tax obligations.
Taxes
The Treaty of Amity allows American citizens and companies with majority US ownership to operate on a national basis in Thailand, exempting them from many of the restrictions imposed by the Foreign Business Act. This includes the liberal professions, domestic trade in agricultural products and exploiting land and other natural resources.
To qualify, the company must file specific paperwork with the Commercial Service office of the U.S. Embassy in Bangkok. Once certified, the company will receive a Foreign Business Certificate, which exempts it from over 50 categories of restricted businesses.
As a result, the company may also qualify for lower corporate taxes and avoid certain work permit requirements. GPS Legal can assist with this process and ensure that all documentation is correct and complete. To learn more, contact us today to schedule a consultation. Our team can walk you through the benefits and drawbacks of establishing an Amity Treaty company in Thailand.
Licensing
Treaty of Amity certification does not get companies off the hook from work permit obligations and other legal requirements. The company must still file the appropriate paperwork, including documents verifying that it complies with Thai law.
The company must also compile a list of shareholders and directors who are American citizens. The American Embassy Commercial Counselor in Bangkok can issue, on request, a letter confirming that the shareholders qualify.
Once the documentation is completed, the U.S. Commercial Service office in Thailand will then certify to the Department of Business Development that the applicant company is majority American-owned and will receive national company privileges under the US-Thai Treaty of Amity. This process takes time, and errors can delay the approvals. Plizz is well-versed in the requirements of setting up a company under the US-Thai Treaty, and will ensure that your application is filed correctly and quickly. We have performed more treaty set-ups than any other firm in Thailand.
