How to Legally Set Up a Thai Company as a Foreigner

Starting a business or settling into work life in Thailand is an exciting journey. As a foreigner, legally setting up a Thai company is not only possible, but comes with multiple pathways to suit different needs. The key is choosing the right structure for your goals – whether you aim to fully control your company, leverage local partnerships, or operate under special agreements. In this guide, we’ll walk you through the main setup options (Thai majority companies, the U.S. Treaty of Amity route, BOI promotions, Representative Offices, etc.), explain the step-by-step process for each, and help you visualize the journey with a simple timeline. Our tone is warm and consultative – think of this as advice from a knowledgeable friend who wants to see you succeed in Thailand. By the end, you should have a clear sense of which path might fit you best, and what steps are involved in legally establishing your Thai company. Let’s dive in!

Understanding Your Options as a Foreign Entrepreneur

Thailand’s laws offer several legal pathways for foreigners to set up a business. The “right” structure depends on your goals and risk appetite. Below, we break down the most common options. Each has its pros, cons, and suitability depending on what you want to achieve:

Option 1: Thai-Majority Limited Company (Local Thai Company)

Most foreigners choose to register a standard Thai limited company with Thai majority ownership. This means Thai nationals hold at least 51% of the shares, and foreigners (like you) hold up to 49%. Why go this route? Under Thai law (the Foreign Business Act), any company with foreigners owning 50% or more is considered “foreign” and faces restrictions in many sectors. By keeping foreign ownership below 50%, your company is treated as a Thai entity and bypasses most of those foreign investment restrictions. In practical terms, a Thai-majority company can engage in businesses reserved for Thais (e.g. many services, retail, restaurants) without needing a Foreign Business License (FBL).

• Typical Structure: You (foreigner) hold 49%, and one or more Thai partner(s) hold 51% collectively. (Since 2023, only 2 shareholders are required to form a company, down from the previous 3 – so you can have one Thai and one foreign shareholder, for example.) The Thai partner can be an individual or another Thai company.

• Legal Control: Many foreign entrepreneurs worry about control when they only have 49%. Structuring can mitigate this – for instance, different classes of shares or agreements – but trust is crucial. Choosing a genuine Thai business partner is essential. Using a Thai “nominee” (someone holding shares on your behalf without real involvement) is illegal and risky. Recent crackdowns have imposed heavy penalties on those using nominee arrangements. Bottom line: if you go Thai-majority, partner with someone who will truly invest and participate in the business, not just a figurehead.

• Advantages: Easiest way to enter sectors that are otherwise closed to foreigners. Fewer bureaucratic hurdles (no need for special foreign licenses in most cases). Generally lower minimum capital requirements than a fully foreign company. You maintain a local image which can be beneficial for certain industries.

• Trade-offs: You relinquish majority ownership, which may feel risky if you’re not completely comfortable with your Thai partner. Profits must be shared according to ownership. Some strategic decisions might formally require Thai shareholder approval (depending on your agreements). However, many foreigners manage the company as the director even with 49%.

• Who it’s for: Those willing to work with a Thai partner and who want to operate in sectors like services, restaurants, retail, or other restricted fields without complex licenses. Also a common choice for small businesses and startups that don’t qualify for special promotions or treaties.

Important: If you use a Thai-majority structure, ensure your Thai partner can prove funding for their share of the capital (e.g. a bank statement). Authorities may check that Thai shareholders truly invested in the company to confirm they aren’t nominee owners. This is part of keeping everything above board and legal.

Option 2: U.S. Treaty of Amity Company (American-Owned Company)

Are you a U.S. citizen (or partnering with one)? The Thai-U.S. Treaty of Amity offers a unique shortcut to 100% foreign ownership for Americans. Under a special 1966 treaty between Thailand and the United States, American individuals or companies can own a majority or even 100% of a Thai company and be treated essentially the same as Thai companies under the law. This means a company with American majority ownership can bypass most Foreign Business Act restrictions and operate in Thailand without needing a Thai partner.

• Key Requirements: To qualify, the company must be at least 50% owned by U.S. citizens (or a U.S.-incorporated entity with majority U.S. ownership), and at least half of the company’s directors must be American. In fact, if only one director has signing authority, that director cannot be a non-U.S. person – essentially an American must have ultimate signing power. These conditions ensure the business is truly American-controlled.

• Process: Even with these ownership conditions, you don’t automatically get the benefits. First, you register a Thai company through the normal DBD process (you can start with 100% American shareholding, which normally would be “foreign” under Thai law). Then, you apply for Treaty of Amity certification from Thailand’s Ministry of Commerce, supported by documents certified by the U.S. Embassy. Thai-Co (or your legal advisor) would prepare an application confirming your company meets the treaty criteria. Once approved, your company is officially recognized as an Amity Treaty company with national treatment rights.

• What You Can (and Can’t) Do: Amity companies are exempt from most FBA restrictions, meaning you can engage in business activities as if you were Thai. However, the treaty has some important exceptions – even American-owned firms cannot engage in certain sectors like communications, transportation, fiduciary services, banking with depository functions, land trading, or exploiting natural resources. Also, Amity companies cannot own land in Thailand (land ownership is generally restricted to Thai entities/people, with few exceptions). But for most trading, service, or manufacturing businesses, the treaty provides a wide berth.

• Advantages: Full control and ownership for Americans without needing a special BOI promotion or Thai shareholders. You get peace of mind that you’re not violating foreign ownership rules – it’s an explicitly legal pathway. It’s great for American entrepreneurs who want to run common businesses (consulting, export, tech, etc.) without local partners.

• Trade-offs: Only available to U.S. nationals or companies. There is extra paperwork and a bit of time involved in getting the treaty certification (which can take a few weeks). You’ll also still need to meet normal Thai company requirements for hiring foreigners (e.g. typically 2 million baht capital and four Thai employees per foreign work permit, since legally your company is still considered “foreign” for work permit/immigration purposes despite treaty protection). Also, you must maintain American majority ownership – if you later transfer shares such that Americans own <50%, you lose the treaty protections.

• Who it’s for: U.S. citizen entrepreneurs or American-led companies who want 100% ownership of a Thai business in allowed sectors. If you hold a U.S. passport or have American business partners, this route is extremely valuable.

  

Option 3: BOI-Promoted Company (Board of Investment Promotion)

Thailand’s Board of Investment (BOI) offers a program to attract foreign investment in certain targeted industries. If your business falls into one of the promoted categories (examples: tech startups, software development, manufacturing, export businesses, research and development, renewable energy, advanced agriculture, and many more high-value sectors), you can apply for a BOI promotion. A BOI-promoted company can be 100% foreign-owned, regardless of the Foreign Business Act, and comes with a host of benefits like corporate tax holidays, permission to own land for the business, easier work permits for foreigners, and exemptions on import duties.

• Key Idea: BOI isn’t a type of company, but rather a status/approval your company can obtain. The process is a bit like applying for an award or permit: you submit a detailed business plan and investment proposal to the BOI agency. This typically includes your project’s scope, financial projections, technology to be used, and how it will benefit Thailand (e.g. job creation, innovation, exports). The BOI committee reviews and, if they like your project, grants a promotion certificate.

• Process: If you’re starting from scratch, you usually apply to BOI first (this can take 1-3 months for approval, depending on the complexity). Once you get the BOI approval, you then proceed to register your company with the DBD like any other company. During registration, you’ll indicate it’s BOI-approved and afterwards you’ll receive a BOI certificate alongside your company registration. If you already have a Thai company, you can also apply for BOI status to convert it into a BOI-promoted company. Thai-Co can guide you in preparing the application and navigating BOI interviews or queries.

• Advantages: Full foreign ownership is allowed (no Thai shareholding needed at all). This is the main legal avenue for non-Americans to own 100% of a Thai company in restricted sectors. BOI companies also often get work permit and visa perks – typically, a BOI company is exempt from the usual rule of 4 Thai employees per foreigner. In fact, a BOI company can often get work permits for foreign experts with much more flexibility (sometimes no minimum Thai hires or lower ratios, depending on the promotion). You also get tax incentives (like 3-8 years of corporate income tax exemption on approved activities) and the ability to buy land for your business operations (normally foreigners can’t own land, but BOI companies can get an exemption to own land for their factory or office).

• Trade-offs: The BOI process requires effort and patience. Not every business is eligible – if you’re opening a local café or a small consulting firm that doesn’t fit BOI categories, this path isn’t an option. The application is detailed, and you may need a solid capital investment (BOI might expect you to invest a certain minimum in your project, hire a certain number of employees, etc., depending on the industry). Compliance is key; after getting promotion, you must report to BOI to show you’re meeting the conditions (e.g. you did invest what you promised, etc.). If conditions aren’t met, benefits can be revoked. Also, while BOI allows 100% ownership legally, you still have to meet immigration/work permit fundamentals like capital requirements – the difference is you often don’t need four Thai employees per foreigner, which eases hiring of expats.

• Who it’s for: Entrepreneurs and companies in promoted sectors who are willing to invest time and money to get special status. If you have a tech startup, manufacturing operation, or project with significant investment, BOI is a fantastic route. It gives you full control and sweetens the deal with incentives. For smaller service businesses or those not in BOI’s list, this isn’t applicable.

Option 4: Representative Office (Non-Trading Office of a Foreign Company)

A Representative Office is a different animal – it’s not a new Thai company, but rather an extension of an existing foreign company into Thailand. If you have an overseas business and want to set up a presence in Thailand just to do non-revenue-generating activities (like market research, liaison with Thai partners, quality control, etc.), a Representative Office can be an ideal legal structure. Essentially, it allows 100% foreign control because it’s considered a branch of your foreign entity, but it comes with a big limitation: it cannot earn any income in Thailand.

• Allowed Activities: Thailand restricts rep offices to specific scopes. The classic permitted activities are: providing information to the head office, sourcing goods or services in Thailand for the head office, market research, networking and local liaison on behalf of head office, and quality control or inspection for the head office’s products. You cannot sign sales contracts, receive revenue, or directly manage trade or production in Thailand under a rep office. All expenses of the rep office (salaries, rent, etc.) must be funded by remittances from the foreign head office.

• Key Requirements: Since a representative office isn’t meant to generate money, Thai law wants to see that you have funds to sustain it. You must bring in a minimum of 2 million THB as capital from the head office to Thailand to finance the rep office. This doesn’t all need to be upfront if the office will operate long-term (over 3+ years, you can stagger the injection), but an initial chunk (e.g. 25% of it) is typically required early. If you plan to have more than one foreign staff in the rep office, note that the capital requirement may effectively rise – e.g. to hire 2 foreigners, the authority expects 3 million THB capital fully paid in. Unlike a normal company, a rep office is not required to have any Thai shareholders (since it’s not a Thai company at all).

• Registration Process: You will need to register the Representative Office with the Department of Business Development (DBD) (specifically, through the Foreign Business Administration division). This is akin to applying for a license to operate a rep office. You’ll submit an application with details of your foreign company (affidavit, financial statements, etc.), the proposed rep office activities, and appoint a Representative (the person in charge in Thailand). The representative can be a foreigner (you, for example) or a Thai. If it’s a foreigner, that person will later get a work permit as the rep. All documents from overseas must be notarized and translated into Thai. Once approved, the DBD issues a certificate for the Representative Office, and you’re essentially good to go. This approval process usually takes a few weeks. The good news: since 2017, setting up a rep office does not require a separate Foreign Business License – you simply notify and register with the DBD, which has streamlined the process.

• Operating a Rep Office: After registration, you’ll obtain a Tax ID for the rep office (even though you won’t pay income tax if there’s no income, you still need a tax ID and must file at least a nil tax return, plus any withholding if you have employees). You’ll open a Thai bank account in the office’s name to receive the funds from your head office. With the rep office certificate and funding in place, your foreign Representative (if one is appointed) can then apply for a work permit and visa to work in Thailand. Notably, rep offices are exempt from the strict 4 Thai employees per foreigner rule that normal companies face – generally, you can have 1 Thai employee per foreign employee in a rep office. This relaxed ratio is a big advantage if you don’t intend to hire many locals initially. It means even if it’s just you running the rep office with maybe one Thai assistant, you can still get your work permit legally.

• Advantages: Full foreign ownership/control since it’s basically your foreign company operating here. Simpler than setting up a whole new company if the purpose is limited to research or liaison. You don’t need a Thai partner at all. Also, as mentioned, you aren’t bound by the 4:1 local-to-foreigner hiring ratio in the rep office structure – helpful for lean operations. It’s a great way to get a feel for the market with low risk: you can have a presence, explore opportunities, and not worry about revenue targets (since you can’t sell anyway!). If later you decide to do business, you can transition to a full company or subsidiary.

• Trade-offs: The obvious downside is no earning income – if you want to actually sell products or services in Thailand or invoice local clients, a rep office cannot do that. It’s strictly a cost center. Also, the capital requirement, while not huge, is there – you must bring in money from abroad to sustain it. Compliance wise, you’ll need to report to authorities if requested how you’re spending funds, and you must not stray into revenue-generating activities (doing so would violate the terms and could get the office shut down). A rep office is ideal for specific scenarios, but not a solution if you actually want to run a local business or startup – in that case, you need a company.

• Who it’s for: Foreign companies expanding into Thailand who need a local foothold for non-sales activities (e.g. a European firm opening a Thai rep office to conduct market research and support regional clients). Also, in some cases, entrepreneurs use a rep office if they primarily have an overseas company and just want to be in Thailand to conduct support work or prep work without starting a full Thai business. Keep in mind you must have an existing foreign company – you can’t create a rep office out of thin air; it’s always tied to a parent entity.

Other Considerations: Foreign Business License (FBL) and Branch Offices

Before we move on to the setup process, a quick note on Foreign Business Licenses and branches: If you’re not American and not eligible for BOI, and you really want to own 100% of your company in a sector restricted by the Foreign Business Act, you might consider applying for an FBL. This is essentially asking the Ministry of Commerce for permission to do a specific business as a foreign-owned company. In practice, FBLs can be hard to obtain for small businesses – they usually require high capital, a strong justification of how your business benefits Thailand, and a waiting process (often 4-6 months for approval, with no guarantee). Many investors find it more straightforward to either go Thai-majority or seek BOI if possible, rather than pursue an FBL. However, it is an available path for certain cases (and Thai-Co can advise if it’s viable for you).

Likewise, foreign companies can set up a Branch Office in Thailand (different from a Rep Office). A branch can engage in revenue-generating activities but generally does require a Foreign Business License if those activities are restricted. Branch setups are more common for large multinational corporations. They also require capital and have similar treatment as foreign companies.

For most entrepreneurs and SMEs, the four options we detailed earlier are the go-to solutions, with Thai majority and Amity being common for services/trading, and BOI for tech/industry projects.

Consultation Tip: Not sure which structure fits your risk appetite? Consider how comfortable you are with local partnership vs. administrative complexity. For example, a Thai-majority company is administratively simple but involves trusting a Thai co-owner (risk is in the partnership). BOI or FBL routes give you full control but involve more bureaucracy and upfront investment (risk is in execution and compliance). There’s no one-size-fits-all answer – the right choice depends on your business goals, investment size, and how much control you need. It’s often worth discussing with an expert to weigh these factors.

Step-by-Step: How to Register a Company and Get Set Up

Once you’ve chosen the structure that best suits your plan, the actual steps to register and legalize your business in Thailand are fairly similar across most structures (with a few special steps for certain options). We’ll break down the general process into clear phases. This will help you understand the road ahead. Keep in mind, Thai-Co will guide you through each step if you engage us – but it’s empowering to know the sequence!

Timeline – Key Steps to Set Up Your Thai Company: (from initial decision to being legally operational)

1. Choose the Right Structure – Decide on Thai majority vs. Treaty of Amity vs. BOI vs. Rep Office, etc. based on your goals. This foundational decision will determine the specific legal path and requirements. (Example: You decide you’re comfortable with a Thai partner and want to open a restaurant, so you choose a Thai-majority company; or you’re a U.S. entrepreneur starting a consulting firm, so you opt for Treaty of Amity.)

2. Register the Company with DBD – Reserve your company name and file incorporation documents with the Department of Business Development (DBD) (Ministry of Commerce). This includes preparing a Memorandum of Association (MOA) listing your company name, address, objectives, shareholders and their shares, and capital. Once the DBD approves and issues the Company Registration Certificate and Affidavit, your company is officially formed. (If you’re doing a Representative Office, this step would be the application to DBD for the rep office license instead of a new company registration.)

3. Obtain Special Certifications (if applicable) – If you pursued a special structure, complete the additional registrations now. For a U.S. Amity company, apply for Treaty of Amity certification with the Ministry of Commerce (after your company is formed) to officially get your treaty protection. For a BOI company, after incorporation, you’ll receive your BOI promotion certificate and will need to follow any initial BOI conditions. For a Rep Office, once the DBD approves it, you’ll get a registration number/certificate for the rep office. These steps ensure your company enjoys the intended benefits (e.g. being recognized as American-owned or BOI-promoted).

4. Post-Registration Setup (Tax, Licenses & Social Security) – Register your new entity with the Revenue Department to get a Tax ID card (required for all businesses) and a VAT registration if you will be engaging in VAT-applicable business (VAT is mandatory once you cross 1.8M THB in revenue, or if you’re in certain businesses from day one). Also, if you have even one employee (including yourself if you will be on payroll), register the company with the Social Security Office (SSO) as an employer. This involves enrolling in the social security system so you and your staff get the state benefits and you can make the required contributions. Thai-Co helps file the employer registration and will guide you on monthly social security filings. (Note: if you plan to hire foreign staff or get a work permit for yourself, Thai labor law typically requires the company to have at least 4 Thai employees per foreign work permit – we cover this below – so you’ll be hiring Thai staff and thus need that SSO registration). Additionally, certain businesses might need industry-specific licenses (e.g. a restaurant needs a food/alcohol license, a school needs permission from Ministry of Education, etc.) – those come after the company exists.

5. Open a Company Bank Account & Fund the Capital – With your company documents in hand, you can open a corporate bank account at a Thai bank. All directors (or the authorized director) usually visit the bank to sign forms. Once the account is open, it’s time to deposit the company’s capital. For compliance (and especially for immigration/work permits), it’s recommended to actually bring in the funds equal to your registered capital and obtain a bank statement showing that deposit. In most cases, if you plan to sponsor a work permit, you should inject 2 million THB capital (or the amount of your registered capital if higher) and be ready to show proof. Thai-majority companies aren’t legally required to fully pay up capital at registration, but for foreigner-related visas it’s expected. Each shareholder should deposit their portion (e.g. if you own 49%, you deposit 49% of the capital, and your Thai partner deposits 51%). For rep offices, the “capital” is the fund from head office – you’d transfer in the required amount (e.g. first installment of that 2M THB). Properly funding your company not only keeps you compliant but also provides working cash for your business needs.

6. Work Permit and Visa for Foreigners – With a Thai company (or rep office) in place, you as the foreign owner or any foreign staff you intend to hire will need to legalize your stay to work. This means obtaining a Non-Immigrant “B” (Business) Visa and a Work Permit. Typically, one goes hand-in-hand with the other. Here’s the simplified flow:

   • Work Permit Pre-Approval: Thai-Co will submit an application to the Ministry of Labor to approve hiring you as a foreign employee of your company. We ensure all conditions are met (the company has the required capital and Thai employees, and all documents are in order). Once approved, the Labor Department issues an approval letter.

   • Visa Application: If you’re abroad, you can use that approval to get a Non-Immigrant B visa at a Thai embassy/consulate in your home country. If you’re already in Thailand on another visa, you can often change status to Non-B visa without leaving – this is done at Immigration in Bangkok with the right paperwork and that Labor approval letter.

   • Work Permit Issuance: After you have the Non-B visa, you attend the Ministry of Labor (or One Stop Service Center for BOI companies) to get your Work Permit booklet/card. This is the legal permit allowing you to work in Thailand under that company and role.

   • Visa Extension: Initially, a Non-B visa is short (90 days). Once your work permit is in hand, you can extend the visa to a long-term stay (usually 1 year at a time, renewable) at Immigration. They’ll check again that the company meets ongoing requirements (still in business, has capital, Thai employees, etc.). Thai-Co handles the extension filings for our clients routinely.

   Timeline-wise, you’d typically incorporate the company first, then within a month or two proceed with work permit/visa once the company has hired some Thai staff and opened its bank account. It’s critical to remember the standard requirements for a Thai company to sponsor a foreign work permit: at least 2,000,000 THB registered capital (fully paid-in) per foreign employee, and at least four Thai employees per foreign employee on the payroll. (There are a few exceptions; for example, if you’re married to a Thai, the capital requirement is halved to 1M, and BOI-promoted companies or rep offices have more relaxed rules on Thai staff.) Thai-Co will ensure you meet these before applying, to avoid any rejection. We also help you fast-track hiring Thai staff and getting them registered with SSO early, so that by the time you apply for your work permit, you can show the government that your company is contributing to local employment and is fully compliant.

7. Ongoing Compliance and Operations – Congratulations, you’re now the owner of a Thai business and are legally able to live and work in Thailand! 🎉 From here, it’s all about running your business and staying compliant. You’ll need to do monthly accounting (Thai-Co offers accounting services if needed), file VAT and withholding tax returns if applicable, contribute to social security for employees, and file annual financial statements and tax returns. Maintain any BOI reporting if you’re BOI-promoted, and renew any licenses (including the yearly work permit and visa extension). While this sounds like a lot, with a good service provider (yes, shameless plug – Thai-Co can be that provider), these become routine administrative tasks and you can focus on growing your business.

The entire journey can feel complex, but broken into steps it’s very manageable – especially with professionals guiding you. Here’s a quick visual rundown of the company setup timeline:

Imagine 5 main milestones: Step 1: Choose Structure → Step 2: Company Registration → Step 3: Set Up Tax & Social Security → Step 4: Bank Account & Capital → Step 5: Work Permit & Visa. Each step leads to the next, from planning to a fully operational business. 

Charting Your Path with Confidence

Setting up a company in Thailand as a foreigner may seem daunting at first glance – there are laws to navigate, decisions to make about ownership and structure, and a series of steps to check off. But remember, thousands of foreign entrepreneurs have successfully done this, and with the right guidance, you can too. The key takeaway is that Thailand wants you here investing and doing business – the government provides multiple pathways (each with its conditions) to accommodate different scenarios. Whether you team up with a Thai partner, leverage an American advantage, earn a BOI promotion, or open a representative office, you can create a legal, thriving presence in Thailand.

At Thai-Co, we pride ourselves on being more than just service providers – we’re consultative partners in your journey. We’ve helped digital nomads launch startups in Bangkok, guided manufacturing firms through the BOI maze, and assisted family businesses in structuring ownership safely. Our approach is always to tailor the solution to your goals and comfort level. Not sure which path is truly right for you? Let’s figure it out together.

Invite: If you’re considering setting up in Thailand, we invite you to book a consultation with Thai-Co. We’ll listen to your plans, discuss your goals and risk appetite, and give honest, experienced advice on the best legal structure for your situation. There’s no one-size-fits-all – it’s about finding your fit in the Thai landscape. With our help, you can proceed with confidence, knowing you’ve chosen the right path and that every step will be handled properly.

Thailand is an amazing place to live, work, and run a business. With the right company structure, you’ll be laying a strong foundation for success here. We hope this guide has demystified the process and given you a clearer picture of how to legally set up a Thai company as a foreigner. We’re excited for you and are here to help make your Thailand business dream a reality.

Ready to get started? Contact Thai-Co to discuss your plans – we’re here to turn your questions into a concrete plan for action. Welcome to the Land of Smiles and good luck on your business journey!