Export/Manufacturing Company

Export/Manufacturing Company in Thailand | Umpire Legal | Photo credit http://www.freepik.com

There are several benefits and requirements associated with operating an export or manufacturing company in Thailand. Umpire Legal can expertly deliver precise information which will allow you to understand the details involved in starting up an export or manufacturing company.

Benefits of Export/Manufacturing Company – 100% Foreign Ownership

Thailand welcomes foreign investment, particularly businesses that are beneficial to the country’s economy. In registering a manufacturing or export business, the procedure is the same as the registration process for any other limited company with the Department of Business Development in Thailand. However, an exceptional privilege for manufacturing companies and export companies in Thailand is that the manufacturing or export companies do not have to comply with the minimum 51% Thai shareholding requirement, since the Foreign Business Act does not prohibit foreigners from operating the manufacturing or export business activities in Thailand. In order for foreigners in a manufacturing company or export company to hold complete or majority shareholding and rights in a limited company operating the manufacturing or export businesses, there must be no indication or operations of any other business activities when outlining the company’s registered objectives. This means that the company cannot have any source of income other than from the manufacture and export businesses.

Overview of an Export/Manufacturing Company

Allowed activities Import raw materials and develop them, manufacture, export (100% abroad)
Capital requirements 2 million THB per Work Permit
Corporate income tax rate 20%
Thai to foreign employee ratio Traditional 1:4
Other requirements An actual physical working space as required by the Ministry of Labour

For more information about Export/Manufacturing Company and how it compares to other business structures in Thailand, you can visit our infographic here.

Registration of an Export/Manufacturing Company

Export companies in Thailand must register with the Customs department to obtain a paperless import-export license (this requirement also applicable for companies involved in the business of import). Prior to obtaining this license, the export company should be registered for VAT with the Revenue department and have a corporate bank account in its name in Thailand. Manufacturing companies in Thailand must also check on whether there is a requirement for a factory license, or any other licenses relevant to the manufacturing business. The manufacturing and export companies must apply for all necessary licenses and permissions that may be required for the manufacturing or exporting business, whereby the requirements depend on several factors such as the type of products that will be manufactured and exported out of the Kingdom, and the size of the manufacturing and exporting operations.