Setting up BOI in Thailand
Requirements and Procedure for Setting Up a BOI Thailand Company
Application for setting up a company under the promotion of BOI Thailand may involve different procedures and requirements based on the specific nature of your business. You can always get the support of our digital agency in Bangkok and hire a team of legal experts to stand for your project and give the Board of Investment officer a comprehensive explanation of what it is all about. Your proposed project must also develop competitiveness for it to earn the approval of the officer.
Board of Investment’s Requested General Qualifications
The value that the project offers should not be lower than 20 percent of revenues with the exception of projects in agricultural products and agriculture, electronic parts and products, as well as coil centers that all have the value-added revenues of a minimum of 20%.
It is imperative to use modern processes for production.
For privatization of the state enterprise projects and concession projects, the criteria of the Board must be based on the decisions of the Cabinet dated the 25th of May 1998 and the 20th of November 2004.
Projects with 10 million THB investment capital or higher with the working capital and cost of land excluded should obtain ISO 14000 or ISO 9000 certification or a similar certification of international standard within two years from the start-up date of full operation.
If not, the exemption from corporate income tax will be reduced by a year.
Concession will not be granted for investment projects for state enterprise under Capital of Public Enterprise Act, B.E. 2542 if a private sector operates the project. The project must be turned into an enterprise project that is owned by the state for investment promotions to be given. The state also needs to submit the form for project approval to the Board of Investment for consideration prior to the start of bidding with a private company. In the process of the auction, the privileges of the private company must be announced loud and clear.
The BOI normally doesn’t promote investment projects when the private sector needs to pay the state with compensations except the reasonable compensation for the investment project.
The Board of Investment will make use of the usual criteria for the approval of state enterprise projects if private sectors own, operate, or rent them.
To privatize state enterprise projects, once the state enterprise is privatized, the limited companies must set the right budgets to ask for the investment promotion of the Board of Investment under Capital of Public Enterprise Act, B.E. 2542. As for project expansion, the limited company is going to be granted just some parts of the expansion under the usual promotion incentives.
Protection of the Environment
There is a need to install efficient and adequate measures and guidelines for protecting the quality of the environment and reducing the environmental impact. The BOI is going to give special consideration to pollution treatment and location of a project with possible impact to the environment.
Activities or projects with size and type required for submission of reports on the assessment of environmental impact must adhere to related Cabinet resolutions or environmental regulations and laws.
Rayong-based projects must abide by the Office of the Board of Investment Announcement No. Por 1/2554 on the Industrial Promotion Policy in Rayong Area dated 2nd of May 2011.
Capital Approval Under the Board of Investment Thailand
Every project has a minimum requirement of capital investment worth 1 million THB that excludes the working capital and cost of capital unless the list of activities specifies otherwise. As for services based on knowledge, the minimum required capital investment is based on minimum yearly expense for salaries indicated in the activity list eligible for the investment promotion.
The debt to equity ratio should not go beyond 3 to 1 for projects that are newly established.
Expansion projects must be considered on a case to case basis.
For projects that have an investment value of more than 750 million THB not including the working capital and cost of land, the feasibility study of the project should be submitted together with the details that the Board has specified.
The consideration of timeframe and application for investment promotion is as follows:
Value of the project ≤ 200 million or ≥ 1 million THB – 40 working days
Value of the project ≥ 200 million but ≤ 750 million THB – 60 working days
Value of the project ≥ 750 million THB – 90 working days.
Required Documents for BOI Application
Here is a list of the required information and document during your application of BOI incentives:
- All corporate documents such as the memorandum of association, list of shareholders, affidavit, and financial statement for already established companies;
- A copy of the passport or the Thai identification card of the tentative company’s director for companies that are not established yet;
- Investment plan and finances;
- Explanation about business scope;
- Size and type of business
- Lust of tool, equipment, machinery, software, and computer that will be used for the project with the country of origin, value, and quantity included;
- Environment Protection Plan;
- Details of employment including nationality, position, and number;
- List of business relation and major customers;
- Marketing plan
- Operation plan that includes estimated revenue, and operation or building site;
- Estimated expense and revenue of the project for the operation’s first three years;
- Project merits if any;
- Company brochures and affiliates.
It is important to note that the officer at BOI might ask for additional documents if deemed necessary. The applicant is also required to join an interview session and presentation to let the officer interview and ask about deep details about the project.
Proceed to Your BOI Application
It is best to get the help and assistance of experts who can give full support as you open and start your business under the promotion of the Board of Investment or BOI in Thailand. They can render the right solutions that are most suitable for your specific business and its specific needs.