Board of Investment Registration in Thailand

BOI Registration

BOI (Board of Investment) Law, is a promotional policy created in 1954, when the Thai government announced its Industrial Promotion Act. The government started actively subsidizing and promoting incentives for foreign skilled workers along with businesses willing to open and operate in the Kingdom of Thailand. Through the Thailand Board of Investment law, the government guarantees not to interfere with or nationalize foreign entities or businesses. Thailand was the first country in the region to have such an investment law.

BOI Thailand helps foreign businesses to establish their operations in Thailand and make sure that their activities will also be beneficial to the Kingdom. Furthermore, BOI application process is quite strict in the essence that it must comply with the regulations and the requirements of the application and focus on providing new technologies and benefits to Thailand. Foreign workers / BOI applicants, and newly established BOI companies need to be considered a valuable investment for Thailand.

The Investment Promotion Act

Under the Thai Investment Promotion Act, Section 16 defines the BOI promotion as: “The activities which are eligible for an investment promotion by the Board are those which are important and beneficial to the economic and social development, and security of the country, activities that involve production for export, activities which have a high content of capital, labor, or service or activities which utilize agricultural produce or natural resources as raw materials, provided that in the opinion of the Board, they are non-existent in the Kingdom, or existent but inadequate, or use out-of-date production processes. ‍
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The Board shall make an announcement designating the types and sizes of investment activity eligible for an investment promotion certificate and may stipulate there in the conditions under which promotion is to be granted and may amend or abolish those conditions at any time. ‍
In the case where the Board is of the opinion that any activity announced to be eligible for promotion under paragraph two no longer requires to be promoted, it may announce a temporary or permanent cancellation of promotion for that activity.” ‍
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The Office of the Board of Investment is a government agency under the Office of the Prime Minister. Its main roles and responsibilities are to promote investment. Here are some of the Thailand Board of Investment promotion policies and main laws to protect a promoted person:

The State shall not nationalize the activity of the promoted person.
The State shall not undertake a new activity in competition with the promoted person.
The State shall not monopolize the sale of products or commodities of the same kind as, or similar to those produced or assembled by the promoted person.
The State will not control the price of the products or commodities of the promoted activity; also, the promoted person shall be granted permission to export products or commodities of the promoted activity.
The State shall not allow any government agency, government organization, or state enterprise to import into the Kingdom, with import duties exempted any kind as those being produced or assembled by the promoted person, which is comparable in quality therewith and is available in sufficient quantity to be acquired for its use.

Current Policy of the Board Of Investment

Since 1954, each new cabinet issued new policies to give more non-tax incentives and more support to foreign investors and foreign investment in Thailand; encouraging investment is an integral part of the BOI. The most recent policy issued is the "Seven-Year Investment Promotion policy (2015 – 2021)". Here are some details:

Promote investment that helps enhance competitiveness by encouraging research & development, innovation, value creation in the agricultural, industrial, and services sectors, SMEs, fair competition, and reduce social-economic disparity.
Promote activities that are environment-friendly, save energy or use alternative energy to drive balanced and sustainable growth.
Promote clusters to create investment concentration in accordance with regional potential and to strengthen value chains.
Promote investment in border provinces in Southern Thailand to help develop the local economy, which will support efforts to enhance security in the area.
Promote special economic zones, especially in border areas, both inside and outside industrial estates, to create economic connectivity with neighbouring countries and to prepare Thailand for entrance into the ASEAN Economic Community (AEC)
Promote Thai overseas investment to enhance the competitiveness of Thai businesses and Thailand's role in the global economy.

BOI Approval Requirements & Procedure

Depending on the nature of your business, requirements and procedures for applying for a Thailand BOI company setup may vary, but our team of lawyers will represent your project and explain it in detail to the BOI officer. All proposed projects must develop competitiveness in order to be approved by the BOI officer.

General Qualifications As Per BOI Policies

The general qualifications when applying for a BOI investment promotion certificate are as follows:

The value-added of the project must not be less than 20% of revenues, except for projects in agriculture and agricultural products, electronic products and parts, and coil centers, all of which must have a value-added of at least 10% of revenues.
Modern production processes must be used.
For a concession project and the privatization of a state enterprise project, the Board’s criteria shall be based on the Cabinet’s decisions dated May 25, 1998, and November 20, 2004.
Projects that have investment capital of 10 million THB or more (excluding the cost of land and working capital) must obtain ISO 9000 or ISO 14000 certification or similar international standard certification within 2 years from the full operation start-up date; otherwise, the corporate income tax exemption shall be reduced by one year.
State enterprise investment projects under the Capital of Public Enterprise Act, B.E. 2542, will not be granted a concession if the project is operated by the private sector. The project needs to be transferred to be a state-owned enterprise project in order to receive investment promotions. The State needs to submit a project approval form to BOI for consideration before starting bidding with a private company. During an auction, there must be a clear announcement on private’s privileges. Normally, BOI will not promote investment projects if the private sector needs to pay compensations to the state except that compensation is reasonable for an investment project.
For state enterprise projects that are owned, operated, and rent by private sectors, the Board will use normal criteria for project approval.
For the privatization of state enterprise projects, after privatizing from state enterprise, limited companies should set appropriate budgets in order to ask for the Board’s investment promotion under the Capital of Public Enterprise Act, B.E. 2542. In the case of expanding projects, the limited company will be granted only parts of expansion under normal promotion incentives.

Registered Capital To Be Approved Under The BOI Thailand

The minimum capital investment requirement of each project is THB 1 million (excluding the cost of land and working capital) unless specified otherwise on the list of activities. As for knowledge-based services, the minimum capital investment required is based on the minimum annual salaries expense specified in the list of activities eligible for investment promotion.
For newly established projects, the debt-to-equity ratio must not exceed 3 to 1.
Expansion projects shall be considered on a case-by-case basis.
For projects with an investment value of over THB 750 million (excluding the cost of land and working capital), the project’s feasibility study must be submitted with details as specified by the Board.

Consideration Of Investment Promotion Application And Timeframe.

Project’s value ≤ 200 million or ≥ 1 million THB – 40 working days
Project’s value ≥ 200 million but ≤ 750 million THB – 60 working days
Project’s value ≥ 750 million THB – 90 working days.

What Documents Are Required To Apply For BOI?

Required documents and information for applying BOI promotion certificate incentives:

Corporate documents, i.e. Affidavit, Shareholder's list, Memorandum of Association, Financial Statement (in case the company has already been established);
Copy of passport or Thai identification card of director of the prospective company (in case the company has not yet been established);
Finances and Investment plan;
Explanation regarding the scope of business;
Type and size of business;
Processes;
List of machinery, tools, equipment, computers, and software that will be used for this project; this shall include country of origin, quantity, and value;
List of major customers and business relations;
Marketing plan;
Operation plan, including building/operation site, estimated revenue;
Estimated revenue and expense of the project for the first 3 years of operation;
Merits of the project (if any);
Brochures of the company and affiliates;
Please be notified that the BOI officer may request further documents as deemed appropriate. Furthermore, the applicant is required to join a presentation and interview session, so that the officer would ask information about this project in more detail.

Procedure in Applying for the BOI Privilege

BOI application procedure which shows how we work on submitting your application to the BOI office

Business Oportunities

Summary

The Juslaws & Consult Thai Law Firm is equipped with a team of lawyers who provide a full range of support for clients opening and starting their business under BOI – Board of Investment - promotion in Thailand. The team of corporate lawyers is dedicated and always ready to deliver the best-tailored solutions for your business.

Our team consists of professional experts who work closely with BOI officers and have more than a decade's worth of experience working with BOI Thailand; they are completely aware of all the requirements and procedures needed for a successful application. Juslaws & Consult can provide you with all the details related to the benefits of the BOI Thailand promotion. Please do not hesitate to contact us for more information.