The US-Thai Treaty of Amity grants American legal entities and individuals a lot of benefits here in Thailand. Most notably, a Company that is vested or certified under the Treaty will be granted national treatment in Thai law.
GPS Legal has extensive experience in setting up companies under the Treaty of Amity. Our team can guide you through the process quickly and inexpensively.
American Nationals
The US-Thai Treaty of Amity allows American citizens to own and manage business entities incorporated in Thailand. These are known as Amity Treaty companies and receive “national treatment,” meaning that they can operate in Thailand without being subject to the same restrictions as foreign businesses under the Foreign Business Act.
A person or company qualifies for Amity Treaty status if they are a natural person who is a United States citizen by birth or by naturalization or a corporation that is organized under United States law and has majority American shareholders. The U.S. Commercial Service office in Bangkok issues a letter verifying this fact, which is required to be submitted to the Ministry of Commerce along with the company’s application for a Foreign Business License.
However, there are some important restrictions. Amity Treaty companies cannot own land and can only engage in activities that have been approved by the Ministry of Commerce. Also, these companies must comply with work permit rules.
American Companies
Under the Treaty, US citizens or businesses may establish a Thai company that can conduct almost any business. However, the companies must comply with work permit rules and cannot own land or occupy more than 50 percent of any other company. The exploitation of land or other natural resources is also restricted.
Generally, foreigners must have majority Thai shareholders in a company to operate in Thailand, but Amity Treaty companies are exempt from this requirement. To qualify for Amity Treaty status, a natural person or business entity must submit a certificate from the US Commercial Service verifying that a majority of its shareholders or partners are American citizens. This application must also specify the company’s business activities.
However, the exploitation of land or other natural resources is still prohibited under the treaty and the exploitation of certain indigenous agricultural products requires approval by the Office of Insurance Commission (OIC). The OIC recently announced that it will require foreigners to obtain permission before acquiring more than 25 percent of the voting shares in life and non-life insurance companies.
Thai Nationals
A US citizen who has Thai citizenship through either birth or naturalization, can establish a company in Thailand without the need for majority Thai shareholders. The entity must still comply with the Foreign Business Act and receive a Foreign Business License (FBL), but the process is much more streamlined than it would be otherwise.
It is also possible for Americans with Thai citizenship to obtain a visa that allows them to work on certain projects in Thailand. However, this is very rare and is usually only granted to people with substantial experience in their field.
Under the old nationality act, children born to Thai and foreign parents had to choose their citizenship by their 20th birthday or face losing it. This requirement has now been dropped, but the current law still allows them to voluntarily renounce their Thai citizenship if they wish. It is recommended that anyone considering this move consult with a lawyer to make sure they are fully aware of the consequences.
Thai Companies
American citizens may own and manage companies in Thailand without having to find a Thai partner holding the majority of shares. In addition, they receive national treatment and are exempt from many restrictions on foreign investment imposed by the Foreign Business Act.
Foreign businesses that are not Treaty of Amity companies must comply with the Foreign Business Act and obtain a license to operate in some sectors. However, a company can be designated as a Treaty of Amity entity through the process of submitting documents verified by the U.S. Commercial Service office at the American Embassy in Bangkok.
A company wishing to be classified as a Treaty of Amity entity must also provide proof of its ownership and a statement describing the nature of the business activities in which it intends to engage. However, the entity will not be permitted to conduct some enterprises such as domestic trade in agricultural products and exploitation of land or natural resources.