Partnership Registration

Parternship Registration Thailand | Umpire Legal | Photo credit http://www.freepik.com

Umpire Legal can advise on the preferred structure for your partnership registration in Thailand, and help you weigh out the pros and cons of each option for your business registration in Thailand depending on your requirements.

Although Thai limited companies are the most common form of business establishments in Thailand and are foreign investors’ preferred choice for legally operating their business activities, the Thai law also recognises partnerships in the form of Ordinary Partnerships and Limited Partnerships. A Partnership can be entered into between two or more individuals and is more commonly registered amongst Thai nationals. The Partnership structure is divided into three different categories, as follows:

  • Ordinary Partnership (unregistered)
  • Ordinary Partnership (registered)
  • Limited Partnership

Overview of Partnerships in Thailand

Unregistered Ordinary Partnership Registered Ordinary Partnership Limited Partnership
Tax Personal Income tax Corporate Income Tax Corporate Income Tax
Registration with DBD Not required Required Required
Liability Unlimited liability for all partners Unlimited liability for all partners Managing partner – unlimited. Ordinary partner – limited to the amount of capital invested.

Ordinary Partnership

Ordinary Partnerships may or may not be officially registered as a juristic person with the Department of Business Development, they would however still be recognised as a Thai legal entity. If an Ordinary Partnership is not registered, it would have no legal status and would be treated as an individual for tax purposes whereby all partners are responsible for their respective obligations and personal income tax payments. On the other hand, Ordinary Partnerships registered with the Department of Business Development are considered as juristic persons and are taxed as corporate legal entities in Thailand.

Limited Partnership

Similar to Registered Ordinary Partnerships, Limited Partnerships are also registered with the Department of Business Development and must consist of at least one managing partner and one or more ordinary partners. The liabilities of the ordinary partners are limited to the amount of capital invested by each partner. Similar to the status of a director in a limited company formation, a managing partner would have unlimited liability for the obligations and debts of the partnership, while the liability of an ordinary partner would be limited in the same way as that of a shareholder in a company.

In the case that a foreigner is the managing partner, he/she must obtain a valid Non-immigrant visa for business or work purposes and a work permit. The Partnership will need to acquire a Foreign Business License if the foreign partner makes majority or more than 49% of the investment. As per the restrictions set forth by the Foreign Business Act of Thailand, the business activity being carried out should not be prohibited or strictly restricted to foreigners.

If you are interested in learning more about the formation of a Partnership structure under the Thai Company Laws, please contact Umpire Legal for an initial consultation.