Draft Announcement of the Prime Minister  Office and Ministry of Interior on Determining Numbers of Foreigner Who Will Have Residence in the Kingdom B.E. ….

The Cabinet has approved a draft Announcement of the Prime Minister Office and Ministry of Interior on Determining Numbers of Foreigner Who Will Have Residence Permit in the Kingdom B.E. …. (“Announcement”) as proposed by the Ministry of Interior.

man in black suit sitting on chair beside buildings

Many foreigners nowadays travel to the kingdom and they would like to have their residence permit for many purposes such as working , investment, marriage or family visitation. All of these foreigners’ entrance can enhance the nation’s economic stability.

According to the Immigration Act B.E. 2522 (1979), the Minister of Interior under approval of Cabinet is able to announce for quotas of foreigners who will have residence permit in Thailand which are not exceeding 100 persons per nationality per year for the year 2021 and foreigners who have no nationality who will have residence permit in Thailand which are not exceeding 50 persons per year. However, those foreigners must receive approval from the immigration officer and Minister of Interior including complying with relevant rules and regulations before granting the residence permit in Thailand.

Business Incorporation and Relevant Registrations in Thailand

Setting up a company in Thailand requires at least 3 or more individuals to subscribe their shares at the incorporation stage. Then, such subscribers shall conduct a statutory meeting for a company establishment to appoint the director(s) of the company and hand over the business to the director(s). The director(s) shall call for shares subscription either in kind or in cash and register for incorporation within 3 months from the statutory meeting.

The company’s director(s) can be both Thai and foreigner. This does not affect the ownership of shares in the company or types of the company whether it is a Thai company or a foreign company under Thai law. However, in the event that the director(s) is a foreigner and receive salary from the company, this shall be considered as an employee who is required to apply for a work permit in order to work in Thailand legally.

Once the company has already been established and if the company has an employee, social security registration is required. In addition, if the company has its income more than 1,800,000 baht per year, the company is required to register for value added tax (VAT) number.

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Last but not least, other registrations or procedures may be required for any other specific types of business. For example, specific licenses are required for operating the restaurant business, securities business, tourism business, etc. The business owners need to seek consultation and check the relevant laws whether the business requires any other specific registrations or procedures.

Draft Ministerial Regulation Stipulating Rules, Procedures, Durations and Rates of Compensation for Elder Benefits during the Reduction of Rate of Contribution Period (No. ..) B.E. ….

The Cabinet, on 5 April 2022, approved in principle of the Draft Ministerial Regulation Stipulating Rules, Procedures, Durations and Rates of Compensation for Elder Benefits during the Reduction of Rate of contribution Period (No. ..) B.E. …. (“Ministerial Regulation”) as proposed by the Ministry of Labor.

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Due to the 3-month reduction of contribution rate measure causing some insurers receive a reduced old age pension based on the amount of contribution into the fund, the Ministry of Labor then proposed for enforcing of the Ministerial Regulation to help such insurers. he main points of this Ministerial Regulation are as follows:

  • This Ministerial Regulation shall be effective from 1 May 2022 onwards.
  • The payment of old age pension to insurers who contribute to the fund during the reduction of contribution rate from 1 May 2022 – 31 July 2022 shall be calculated from additional 2.95% of wages of insurers from 1 May 2022 – 31 July 2022 in order to additionally pay the old age pension from the rate stipulated in Article 6 (2) of the Ministerial Regulations Stipulating Rules, Procedures, Durations and Rates of Compensation for Elder Benefits B.E. 2550 (2007).
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The Ministry of Labor has issued the measures to alleviate suffering of insurers affected during the reduction of contribution rate causing some insurers receive less old age pension. The old age pension shall be paid to the insurers who contributed   into the fund during the reduction of the contribution rate, from May – July 2022, calculated from the additional 2.95% of the insurers’ wages. Such increased payment of pension is from budget of the Social Security Fund.

Updated Rate of Contribution to the Social Security Fund

The Cabinet, on 5 April 2022, approved in principle of the draft Ministerial Regulation Stipulating the Rate of Contribution to the Social Security Fund B.E. …. (“Ministerial Regulation”) as proposed by the Ministry of Labor in order to make an amendment to the Ministerial Regulation Stipulating the Rate of Contribution to the Social Security Fund B.E. 2564 (2021). The main points of this Ministerial Regulation are as follows:

  • Repealing the Ministerial Regulation Stipulating the Rate of Contribution to the Social Security Fund B.E. 2564.
  • From 1 May – 31 July 2022, the government, employers, and insurers under Section 33 of the Social Security Act B.E. 2533 (1990) shall contribute 0.9% of the insurers’ wage rate for compensation in the event of injury or sickness, disability, death, and childbirth. For the compensation in case of child support and old age, the employers and insurers shall contribute 0.05% of the insurers’ wage rates and the government shall contribute 1.6% of the insurers’ wage rates. For the compensation in case of unemployment, the employers and insurers, shall contribute 0.05% of the insurers’ wage rates and the government shall contribute 0.25% of the insurers’ wage rates.
  • From 1 August 2022 onwards, the government, employers and insurers under Section 33 of the Social Security Act B.E. 2533 shall contribute 1.5% of the insurers’ wage rates to the fund for compensation for injury or sickness, disability, death, and childbirth. For compensation in case of child support and old age, the employers and insurers shall contribute 3% of the insurers’ wage rates and the government shall contribute 1% of the insurers’ wage rates. For the compensation in case of unemployment, the employers and the insurers shall contribute 0.5% of the insurers’ wage rates and the government shall contribute 0.25% of the insurers’ wage rates.
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The reduction in employers and insurers contribution rates has resulted in a lower contribution that the employers and insurers is required to contribute to the Social Security Fund from 5% to 1% of the insurers’ wage rates. In addition, the insurers under Section 39 of the Social Security Act B.E. 2533 (1990) also contribute less to the Social Security Fund, from the rate of 432 baht per month to the rate of 91 baht per month.

Announcement of the Ministry of Labor on Permission for Foreigners to Work in the Kingdom as a Special Case according to Economic and Investment Stimulus Measures by Attracting High Potential Foreigners to Thailand

To implement the Cabinet Resolution on December 7, 2021, the Cabinet, on January 18, 2022, has approved the draft Announcement of the Ministry of Labor on Permission for Foreigners to Work in the Kingdom as a Special Case according to Economic and Investment Stimulus Measures by Attracting High Potential Foreigners to Thailand (“Announcement”) which has the main principle of allowing foreigners and their spouses, according to the Draft Announcement of the Ministry of Interior on Permission of Certain Groups of Foreigners to Stay in the Kingdom as a Special Case, to work in the Kingdom as a special case in response to the government’s measures on economic and investment stimulus that will result in more domestic spending as well as bring the positive outcome to the entrepreneurs. These will generate solid income for people and workers and  lead to more investment and enable Thailand to have more specialists in various fields in which it  will be benefit to the country’s economy. The main points of this Announcement are as follows:

man in black suit sitting on chair beside buildings
  1. Defining the term “Foreigner” as a foreigner and its dependent who is a foreigner’s spouse in compliance with the Draft Announcement of the Ministry of Interior on Permission of Certain Groups of Foreigners to Stay in the Kingdom as a Special Case according to Economic and Investment Stimulus Measures by Attracting High Potential Foreigners to Thailand
  2. Stipulating that the foreigner can apply for a work permit in accordance with the law on foreign working management. Once, the foreigner has submitted an application, such foreigner will be allowed to work for the time being without a work permit.
  3. The duration of the work permit is as follows:
    • In case the foreigner works with its employers, the work permit shall be valid in the same period as the employment contract but not more than 5 years from the date of issuing of such work permit. The foreigner can renew its work permit to be in accordance with the duration of its employment contract but not more than 5 years at each time.
    • In case the foreigner works without any employer, the work permit shall be valid for the period as requested by the foreigner but not more 5 years from the date of issuing of such work permit. The foreigner can renew its work permit according to the period as requested by the foreigner but not more 5 years at each time.
  4. Permission for the foreigner to work shall be expired when the permission to stay in the Kingdom has expired according to the Draft Announcement of the Ministry of Interior on Permission of Certain Groups of Foreigners to Stay in the Kingdom as a Special Case, e.g. the foreigner acts against the Announcement of the Ministry of Interior, is lack of qualifications required by law, or is believed to behave as a threat to society, etc.

On 19 October 2021, The Cabinet has approved in principle of the draft Notification of the Ministry of Interior regarding the Permission of Foreigners Granted Thailand Privilege Card to Stay in Thailand for Working as a Special Case (“Draft Notification”) and the draft Rules and Conditions for Allowing Foreigners Received Thailand Privilege Card to stay in Thailand for Working as a Special Case (“Draft Rules and Conditions”) as proposed by the Ministry of Tourism and Sports and considers this matter as an urgent matter.

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The main points of the 2 drafts are as follows:

  • Draft Notification
    1. The aliens who receive Thailand Privilege Card under the conditions as specified in  the Ministry of Interior’s Notification regarding permission of certain classes of aliens to stay in Thailand as a special case dated 22 February 2013 and have minimum investment of USD 1,000,000 per year, in a specified business, including their spouses and their under-20-year-old children, can request to change the type of visa to Non-Immigrant Visa for a term of 5 years throughout the investment period in the Flexible Plus Program.
    2. The aliens whom their types of visa have been changed as mentioned above, can apply for a work permit under the law on foreigners working management.
    3. The termination of the permission of aliens and their dependents to stay in Thailand according to this Draft Notification is under one of the following cases:
      • The minimum investment, in a specified business, does not reach USD 1,000,000 within one year from the date of entering into the program;
      • The work permit has been terminated under the law on foreigners working management; or
      • Such aliens have presumably into believing that their behavior that is danger to society, have been issued a warrant of arrest by a foreign government, being deported by the Thai government or foreign governments, or being revoked the right to stay in Thailand.
  • Draft Rules and Conditions
    1. Aliens must be a special member holding Thailand Privilege Card:
      • For the remaining members, Thailand Privilege Card must be validity at least 5 years; or
      • For the new members, they must apply for Thailand Privilege Card with a minimum card value of 1 million Baht and the validity of the card is for more than 10 years.
    2. An alien must receive a special Privilege Entry Visa (PE).
    3. An alien must invest in Thailand within 1 year from the date of requesting to join the Flexible Plus Program or from the date of approval to be a special member with a total investment value not less than USD 1,000,000 which consists of 3 types:
      • Investment in real estate according to the rights of foreigners;
      • Investment in a limited company or a public limited company; or
      • Investment in stock exchanges such as ordinary shares, debentures, or investment units which has been approved by the Securities and Exchange Commission.
    4. An alien must have all qualifications under the law on foreigners working management.

On 29 September 2021, the Cabinet has approved a draft Announcement of the Office of the Prime Minister and the Ministry of Interior (MOI) regarding Limitation of Numbers of Alien Annually having residence in Thailand as proposed by MOI.

The aliens under nationality of each country having residence in Thailand of the year 2021 will be limited to not exceeding 100 persons per country and stateless aliens will be limited to not exceeding 50 persons.

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This Announcement is structured to be in accordance with Section 40 paragraph one and Section 41 of the Immigration Act B.E. 2522 (1979) and Section 5 paragraph one of the Immigration Act B.E. 2522 (1979), as amended by the National Council for Peace and Order Announcement No. 87/2557 dated 10 July 2014.

On 27 September 2021, the Government Gazette website has published the Ministerial Regulation Determining the Rate of Contributions to the Social Security Fund B.E. 2564

The reasons for the promulgation of this Ministerial Regulation are to alleviate the burden of employers and insurers in accordance with the current economic and social situation affected by the coronavirus disease 2019 outbreak.

The main point of the said Ministerial Regulation is to adjust the rate of contributions to an appropriate rate that the government, employers and insurers under section 33 shall pay to the fund for compensation for injury or sickness, disability, death, childbirth, child allowance, old age, and unemployment according to the list of contribution rates annexed to the Ministerial Regulation as follows:

1. From 1 September 2021 to 30 November 2021, the rate is to be in accordance with Schedule A below.

PayersContribution rate in percentage under the insured’s wages
Contributions for compensation for injury or sickness, disability, death, and childbirth 
Government1.5
Employers1.5
Insurers1.5
Contributions for compensation for child allowance and old age 
Government1
Employers0.95
Insurers0.95
Contributions for compensation for unemployment 
Government0.25
Employers0.05
Insurers0.05

2. From 1 December 2021 onwards, the rate is to in accordance with Schedule B below.

PayersContribution rate in percent of the insured’s wages
Contributions for compensation for injury or sickness, disability, death, and childbirth 
Government1.5
Employers1.5
Insurers1.5
Contributions for compensation for child allowance and old age 
Government1
Employers3
Insurers3
Contributions for compensation for unemployment 
Government0.25
Employers0.5
Insurers0.5

On 27 June 2021, we were invited by Thai Theatre Foundation to provide a special lecture on the topic of labour law to participants in the theatre industry.

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Lecturer: Panisa Suwanmatajarn

Due to the effect from the outbreak of COVID-19, the Ministry of Labour then had proposed a Draft Ministerial Regulation on the Social Security Fund Contribution Rates (No. ..) B.E. …. (the “Draft Ministerial Regulation”) to the Cabinet in order to alleviate the suffering of insured employees affected by such outbreak of COVID-19.

Summaries of the Draft Ministerial Regulation are as follows:

  1. The rates of contribution schedule attached to the Ministerial Regulation on the Social Security Fund Contribution Rates B.E. 2563 will be revised to the new rates.
  2. Such new rates will be valid for 2 months starting from 1 February 2021 to 31 March 2021.
  3. The insured employees under Section 33 of the Social Security Act B.E. 2533 will be entitled to a reduction of social security fund contribution to be at the rate of 0.5% of their wage’s rates. For the employers and the government, the rates of contribution are still the same, i.e. 3% and 2.75% of the insured employees’ wage rates, respectively.
  4. The contribution for benefits related to injury, sickness, incapability, death and parturition will be at the rate of 0.2% of the insured employees’ wage rates applied to all insured employees, employers and government.
  5. In regard to the contribution for benefits related to child and old age, the government’s contribution rate will be reduced as 2.3% of the insured employee’s wage rates whereas the employers’ contribution rate will be reduced as 2.7% of the insured employees’ wage rates and the employees’ contribution rate will be reduced as 0.2% of their wage rates.
  6. In addition, the contribution for benefits related to unemployment will be reduced as 0.25% of the insured employee’s wage rates for the government and as 0.1% of the insured employee’s wage rates for the employers and the insured employees.

This Draft Ministerial Regulation was approved by the Cabinet on 26 January 2021 and is expected to be enacted and become enforced shortly.