Prolonging of Another 10 Years for Capital Injection into Thailand
by Panisa Suwanmatajarn and Krerktanes Suwanprasit
FAccording to Section 14 of the Foreign Business Act B.E. 2542 (1999), it provides that the minimum capital to be used by a foreigner for the commencement of the operation of a business in Thailand shall not be less than that prescribed in the ministerial regulation provided that it shall not be less than two million Baht.
The Ministerial Regulation Prescribing the Minimum Capital and Period for Bringing or Remitting the Minimum Capital into Thailand (“Ministerial Regulation”) B.E. 2545 (2002) and its amendments issued under the provisions of this Section 14 may not only prescribe the minimum capital, but also the period of time in which the minimum capital must be brought or remitted into Thailand. Under the Ministerial Regulation, the capital must be brought or remitted into Thailand within 3 years. However, the individuals or entities of states which are members of the bilateral treaties in which Thailand are the member, are entitled to prolong bringing or remitting the capital into Thailand for a certain period of time as prescribed in the 3rd of Ministerial Regulation, i.e. 10 years, which is the current enforcing Ministerial Regulation. Lists of category of such individual or entity are as follows:
- Foreigners who are natural persons or juristic persons not registered, but operate their businesses in Thailand.
- Foreigners, being juristic persons registered in Thailand, operate their businesses in Thailand, which such juristic persons do not have the minimum capital as prescribed on the date of the commencement of business operation.
- Foreigners who have operated their businesses in Thailand before the date of entry into force of the Ministerial Regulation and its amendments, but has not yet brought or remitted foreign currencies that form the minimum capital into Thailand.
Since the extending period of time for bringing or remitting the capital into Thailand for those individuals or entitles are becoming close to its maturity, i.e. on 29 August 2019. In order to maintain the right for such individuals or entities under this National Treatment scheme, the renewal of current 3rd Ministerial Regulation is required.
On 28 May 2019, the Cabinet approved in principle a draft Ministerial Regulation Prescribing the Minimum Capital and Period for Bringing or Remitting the Minimum Capital into Thailand (No. …) B.E. …. proposed by the Ministry of Commerce, as the 4th of the Ministerial Regulation, for extending of the period for bringing or remitting the capital into Thailand for another 10 years from the expiration of the 3rd the Ministerial Regulation (“Draft Ministerial Regulation”). The Draft Ministerial Regulation will be submitted to the Council of State for its consideration and revision before returning to the Cabinet for its final approval. The Draft Ministerial Regulation as planed shall become enforced by this 30 August 2019.