The Factory Act of 1992 stipulates regulations for factory establishment and operation, factory expansion, and safety requirements. The Act also imposes strict controls on industrial pollution and is administered by the Department of Industrial Works of the Ministry of Industry in Thailand who ultimately issues factory licenses.
A factory is defined as any premise that uses machinery equivalent to five horsepower or more, or that employs seven or more, with or without any machine, for manufacturing, producing, assembling, packing, repairing, maintaining, testing, improving, processing, conveying, storing or destroying anything included in the classes or types of factories presently listed with the Ministry of Industry.
Factories are divided into three categories:
In category three(3) the operator of a factory must notify the competent authority at least 15 days before a factory test-run commences, and again at least 15 days before actual manufacturing begins.
Licenses once granted are valid for five(5) years. In case of relocation of the factory or of the dissolution of the operation in the factory business, the license is regarded as having expired on the date of either relocation or dissolution of factory business.
Currently some districts in Ayutthaya and Pathum Thani Provinces have been assigned by the Cabinet to be reserved as sources of water by the Metropolitan Waterworks Authority. In order to control the establishment or expansion of factories in such areas, regulations have been imposed forbidding setting up or expanding factories which release wastewater containing heavy metals or poisonous substances used in agriculture, or other chemicals such as PCBs, cyanide, arsenic, and phenol. The only exceptions are factories which release wastewater with a biochemical oxygen demand of less than one kilogram per day or those which are set up in Navanakorn Industrial Estates I and II.
Under Ministerial Regulation No. 3, factories that are specified by Ministry of Industry, as severely affecting the environment are required to provide environmental impact studies.
Factory licenses and industrial regulation in Thailand are complex processes. It is essential to analyze the business in depth as there may be various additional laws and regulations that can hinder the application process. Therefore, we always advice clients to consult with our experienced team of lawyers prior to attempting to apply for such a license. Contact Juslaws & Consult for more information on Factory Licenses.