🏢Starting a Company

You're sitting across from a Thai lawyer in a glass-walled office on Sukhumvit Road, watching rain streak the windows while she explains why you can't own more than 49% of the company you're about to pour 200,000 dollars into. The lawyer's tone is matter-of-fact, like she's explained this a thousand times before. "You need Thai shareholders for 51%," she says, sliding a diagram across the table. "It's the Foreign Business Act. But don't worry—there are ways to maintain control."

Starting a company in Thailand as a foreigner means navigating a framework designed primarily for Thai nationals. The Foreign Business Act of 1999 restricts foreign ownership in most sectors to 49%, requiring majority Thai ownership unless you qualify for specific exemptions. It's a rule that shapes every subsequent decision—how much capital you need, who your partners are, what kind of business structure makes sense, and whether Thailand is even the right jurisdiction for what you're trying to build. Note that Thailand's cabinet approved amendments to the Foreign Business Act in April 2025 that may increase foreign equity thresholds in certain sectors, though these reforms have not yet been enacted into law.

But here's what that lawyer might not immediately tell you: thousands of foreign entrepreneurs successfully operate businesses in Thailand under this framework. Some navigate the 51% requirement through legitimate Thai partnerships. Others qualify for Board of Investment (BOI) promotion that allows 100% foreign ownership. A few structure their companies to maintain operational control while accepting minority equity positions. And many discover that the 51% rule, while limiting, doesn't necessarily prevent them from building profitable, sustainable businesses.

Understanding the 51% Rule

The 51% Thai ownership requirement exists to protect local businesses from foreign competition in sectors considered important to Thailand's economy and culture. The restriction isn't arbitrary—it reflects Thailand's approach to economic sovereignty in a globalized world. Rice farming, newspaper publishing, land trading, and dozens of other activities are either prohibited entirely to foreign ownership or require special licenses.

For a standard Thai Limited Company, this means finding Thai shareholders who will collectively hold at least 51% of your company's shares. These must be genuine beneficial owners—not nominees acting as proxies for foreign control. Nominee arrangements, where Thai shareholders are secretly controlled by foreign money through loans or agreements, are explicitly illegal. Penalties include up to 3-5 years imprisonment, fines up to 1 million baht, daily penalties of 10,000-50,000 baht, company dissolution, asset seizure, and deportation. The Thai government intensified enforcement dramatically in 2025, with over 29,000 legal cases filed and 852 companies prosecuted. New anti-money laundering amendments classify nominee structures as predicate offenses, empowering authorities to freeze and seize all assets acquired through illegal nominees. Over 46,000 entities face inspections in 2025. This is not a theoretical risk—it's active, aggressive enforcement.

So how do foreign entrepreneurs actually operate? Three legitimate paths exist. The first is true partnership—finding Thai business partners whose skills, connections, or capital complement yours, and structuring the company as a genuine joint venture. The second is qualifying for BOI promotion in targeted industries, which grants 100% foreign ownership as an incentive for bringing technology, jobs, or exports to Thailand. The third, available only to U.S. citizens, is the Treaty of Amity, which provides most-favored-nation status and allows majority ownership in most sectors.

The BOI Advantage: 100% Foreign Ownership

If your business qualifies for promotion from Thailand's Board of Investment (BOI), the ownership restriction disappears entirely. BOI companies can be 100% foreign-owned, exempt from most Foreign Business Act restrictions, and eligible for substantial tax holidays ranging from three to thirteen years depending on the sector, activity level, and location. Frontier technologies and targeted high-value activities (A1+ category) can receive the longest incentives, while standard value-added activities receive shorter periods.

BOI targets industries Thailand wants to develop: advanced manufacturing, biotechnology, automation and robotics, digital services, renewable energy, and high-value-added services. The application process typically takes two to three months (60-90 days), though complex or incomplete submissions can extend this timeline. Applications require a detailed business plan, financial projections, and evidence that your company will contribute to Thailand's economic development through technology transfer, employment creation, or export generation.

Beyond ownership and taxes, BOI promotion includes permits for foreign workers and their families, import duty exemptions on machinery, and permission to own land for factory or office use—privileges otherwise difficult or impossible for foreign companies. But promotion comes with obligations. You must meet employment targets, maintain minimum capital, and operate within your promoted activities. The BOI monitors compliance, and failing to meet conditions can result in losing your promoted status.

Is BOI worth pursuing? If you're planning a technology-focused business, manufacturing operation, or regional headquarters that aligns with Thailand's development priorities, absolutely. The combination of ownership freedom and tax savings can be transformative. But BOI isn't suitable for service businesses, retail operations, or companies that don't fit the targeted sectors. Most small foreign businesses in Thailand—consultancies, agencies, import-export firms—operate as standard Thai Limited Companies because they don't qualify for promotion.

Company Types: Choosing Your Structure

Most foreign businesses in Thailand operate as Thai Limited Companies—the standard corporate structure requiring minimum two shareholders and one director. It's the most straightforward formation, and with the enhanced 2025 digital registration system can be completed in as little as 3-5 business days for the core registration (though traditional methods take 2-4 weeks). Total costs range between 50,000-100,000 THB including legal fees and initial capital contributions. This structure works for service businesses, consultancies, trading companies, and any operation that doesn't qualify for BOI promotion.

The registered capital requirement depends entirely on work permits. While you can technically register a company with one million baht capital, that won't support any foreign work permits. Each foreign employee requires two million baht in registered capital plus four Thai employees. Planning a three-person foreign team? You need six million baht registered capital and twelve Thai employees. This formula shapes every small business's initial structure and hiring plans.

Branch offices and representative offices offer alternatives for established foreign companies expanding to Thailand. A branch can conduct commercial activities and generate revenue but requires remitting three million baht minimum capital from the parent company and obtaining a Foreign Business License. A representative office handles only liaison activities—market research, quality control, coordination—without generating Thai revenue. It's useful for companies exploring the market before committing to full operations.

Which structure makes sense for you? If you're a solo entrepreneur or small team starting fresh in Thailand, a Thai Limited Company with local partners remains the most practical option. If you're running a qualified tech or manufacturing business, pursue BOI promotion for the ownership and tax advantages. If you're extending an existing foreign entity's operations, consider a branch office. The choice depends on your industry, capital availability, and long-term Thailand strategy. For more on working legally in Thailand, see our detailed work permit guide.

The Registration Process: What Actually Happens

Company registration in Thailand follows a defined sequence managed primarily through the Department of Business Development (DBD). The process begins with name reservation—submitting your proposed company name in Thai and English for approval. Names must be unique, cannot suggest government affiliation, and can't conflict with existing registered companies. This takes one to three business days and costs approximately 200-500 baht.

Next comes document preparation: the Memorandum of Association outlining company objectives, Articles of Association establishing governance rules, and shareholder agreements defining ownership and control mechanisms. This is where experienced legal counsel earns their fees. The documents must be precise, compliant with Thai corporate law, and structured to protect your interests within the 51% framework. Trying to save money by using templates or cheap consultants here often creates problems that cost far more to fix later.

With documents prepared, you file incorporation papers at the DBD office or through their online portal. Registration fees are calculated based on registered capital: the Memorandum of Association costs 50 baht per 100,000 baht of capital (minimum 500 baht, maximum 25,000 baht), and company registration costs 500 baht per 100,000 baht of capital (minimum 5,000 baht, maximum 250,000 baht). For a typical 2-million-baht company, total government fees are approximately 11,000 baht. Processing takes three to seven business days with traditional methods, or as little as 3-5 days with the 2025 digital system if everything is in order. Common delays occur from incomplete documentation, address verification issues, or shareholder passport problems. Having all documents properly translated, notarized, and certified before filing prevents most delays.

Once incorporated, you register for a tax ID at the Revenue Department, open a corporate bank account (often the slowest part, taking two to six weeks), register for VAT if applicable, and enroll in the Social Security system when hiring employees. Each step has specific documentation requirements and processing times. Total timeline from starting the process to having a fully operational company with bank account: three to six weeks with the 2025 digital system if everything proceeds smoothly, or four to eight weeks using traditional methods. Complications can extend this to several months.

Capital Requirements: The Real Numbers

The minimum registered capital for a Thai Limited Company is technically one million baht, but that number is largely meaningless for foreign businesses. What matters is the work permit formula: two million baht per foreign employee. Planning to work in your own company? Two million baht minimum. Want your spouse to work too? Four million. Need a small team of three foreigners? Six million plus twelve Thai employees to meet the four-Thai-per-foreigner requirement.

This capital must be genuinely paid in—not just registered. You have options for how to contribute: cash deposits to the company bank account (most common), tangible assets like equipment or vehicles transferred to the company, or intellectual property properly valued and documented. Traditionally, 25% of stated capital must be paid upon incorporation, with the remainder paid according to the schedule in your Articles of Association. However, as of 2024, companies with registered capital up to 5 million baht can declare capital without paying it in at registration. For capital exceeding 5 million baht, the Department of Business Development requires additional documentation to verify contributions. The days of registering phantom capital are long gone; banks and the DBD verify capital contributions carefully.

For many foreign entrepreneurs, the capital requirement becomes the decisive factor in whether Thailand makes sense for their business. If you're a solo consultant who needs a Thai company for visa purposes, coming up with two million baht in capital plus employing four Thai staff for a small operation can be prohibitively expensive relative to your revenue. This is why many individual consultants work differently—operating through overseas entities, using agent services, or partnering with established Thai companies that can provide the infrastructure.

But if you're building a real business with multiple employees, genuine operations, and growth plans, the capital requirements are manageable. A two-million-baht requirement is about 55,000 USD—not insignificant, but reasonable for serious business ventures. The Thai employees you need to hire can perform real functions: administrative support, customer service, operations assistance. Many successful foreign businesses find that the Thai staff requirement, initially viewed as a burden, actually strengthens their operations by embedding local knowledge and capabilities. If you're setting up operations, you'll also want to understand Thai banking requirements for businesses.

What They Don't Tell You Upfront

Starting a company is the easy part. Operating it compliantly in Thailand requires ongoing attention to details that can trip up even experienced entrepreneurs. Monthly accounting and tax filings must be submitted on time—penalties accumulate quickly for late VAT submissions. Annual financial statements must be audited and filed. Shareholder meetings must be held and documented. Social Security contributions for Thai employees must be paid monthly. The DBD requires annual confirmation of company details. Miss any of these, and you face fines, penalties, or complications with visa and work permit renewals.

This is why hiring a qualified Thai accountant from day one isn't optional—it's essential infrastructure. Expect to pay 8,000-20,000 baht monthly depending on transaction volume and complexity. Good accountants do more than bookkeeping; they ensure compliance with constantly evolving regulations, handle tax filings, manage Social Security obligations, and keep you informed of deadlines. The relationship with your accountant matters as much as the relationship with your lawyer. Both should be qualified professionals with experience serving foreign clients, not the cheapest option you can find.

Bank account opening deserves special mention as a consistent pain point. Thai banks are cautious about foreign-owned companies due to money laundering concerns. The approval process can take weeks or months, requires extensive documentation, and often demands that all directors appear in person. Some banks are more foreign-friendly than others—Bangkok Bank, Kasikorn Bank, and Siam Commercial Bank generally have better track records with foreign companies. Working with business consultants who have banking relationships can expedite the process significantly.

Finding legitimate Thai partners remains the biggest challenge for foreign entrepreneurs who don't qualify for BOI promotion. You need shareholders who have genuine capital to invest, legitimate business interests in the company's success, and trustworthiness for a long-term partnership. Family members of Thai spouses work if there's genuine investment and risk. Professional Thai partners in your industry can bring valuable connections and local market knowledge. What doesn't work: nominee arrangements where Thai individuals hold shares purely on paper for a fee, with no real economic interest. These structures are illegal and increasingly prosecuted.

Is Thailand Right for Your Business?

Starting a company in Thailand makes sense for certain business models and circumstances. If you're building a manufacturing operation that qualifies for BOI incentives, Thailand's combination of skilled labor, infrastructure, and tax benefits is compelling. If you're establishing a regional headquarters or service center that serves Asia-Pacific markets, Thailand's central location and business infrastructure work well. If you're creating a business that requires Thailand-based operations—tourism services, property development, import-export with Thai suppliers—forming a local company is necessary.

But Thailand doesn't make sense for every business. If you're a solo digital entrepreneur whose clients are entirely overseas, maintaining a Thai company with four Thai employees and two million baht capital to get a work permit is probably overkill. Working on other visa types or structuring your business through overseas entities while living in Thailand may be more practical. If your business model requires complete ownership control and you don't qualify for BOI promotion, jurisdictions like Singapore or Hong Kong offer simpler foreign ownership structures.

The decision comes down to whether Thailand's advantages—market access, operating costs, lifestyle, talent pool—outweigh the complications of the 51% rule and capital requirements. For businesses with Thai market focus, regional operations, or manufacturing needs, Thailand often wins decisively. For pure service businesses or digital companies with no Thailand-specific advantages, the calculus is less clear. Be honest about whether you need a Thai company or just want one because you love living here.

If you do proceed, go into it with realistic expectations about time, cost, and complexity. Budget 150,000-250,000 THB for professional setup services, plus your registered capital, plus six months of operating expenses before revenue becomes reliable. Work with qualified lawyers who specialize in foreign business formation—expect to pay 50,000-80,000 THB for proper legal work. Establish relationships with experienced accountants before you need them. Build genuine partnerships with Thai shareholders who share your business vision. And accept that compliance will require ongoing attention and cost.

Thailand welcomes foreign business, but on Thai terms. Understanding those terms—the 51% rule, BOI pathways, capital requirements, compliance obligations—is the price of entry. Thousands of foreign entrepreneurs successfully navigate these requirements and build thriving businesses here. Many find that working within the Thai framework, rather than trying to circumvent it, leads to stronger businesses with better local connections and deeper market understanding. The constraints force you to build real partnerships, hire local talent, and embed yourself in the Thai business ecosystem. For the right business at the right stage, Thailand isn't just workable—it's excellent. For practical guidance on relocating here, check our comprehensive settling in guide.