The US-Thai Treaty of Amity offers significant protections to American companies. It allows them to own a majority of shares and engage in business on the same basis as Thais (national treatment) and is exempt from most restrictions on foreign investment under the Alien Business Act.
The company must be certified by the US Commercial Service to receive these benefits. Once certification is complete, the company must submit to the Thai Department of Commercial Registration in the Ministry of Commerce to register under the treaty.
Benefits
The US-Thai Treaty of Amity allows Americans to start companies in Thailand where they can own the majority of shares. It also exempts them from some restrictions that are placed on foreign investors.
A company that wants to operate under the protection of the treaty must meet several requirements. These include proving that it is an American owned and managed company, that the majority of the owners are US citizens, and that the company has been incorporated in compliance with Thai law. The company must then submit the documents for certification by the Commercial Service office (CSO) in the Embassy.
This process is complicated and may take time to complete. It is important to consult with a firm that has experience setting up and maintaining companies under the treaty. It is also important to discuss the drawbacks of operating under this arrangement, such as the requirement for a co-signator from a non-Amity treaty company when hiring employees or signing contracts.
Eligibility
The 1966 treaty allows American citizens to own majority shares in companies engaging in business enterprises that are generally restricted to Thai citizens under the Foreign Business Act. This includes exploitation of land and natural resources, domestic trade in agricultural products, and the liberal professions.
Before an American company can be certified as a US-Thai Amity treaty company, it must comply with all the requirements set forth in the treaty. This will typically involve submitting a copy of the company’s certificate of incorporation from the US and documentation from the Commercial Service Office at the US Embassy in Bangkok verifying that a majority of the shares are owned by American citizens.
The companies must also provide an affidavit from the shareholders that they are Americans by birth or naturalization. This process can take between four to five weeks. Once certified, these companies will be granted national treatment in Thailand. However, they will still have to obtain a work visa or bring in two million baht worth of capital to employ one Thai worker.
Requirements
To qualify for protection under the US-Thai Treaty of Amity, a company must be majority owned by American citizens or companies. The directors and shareholders of the company must also be U.S. citizens by birth or naturalization. Proof of this must be submitted to the Commercial Service office at the American Embassy in Bangkok.
Once this is done, the company can apply for a Foreign Business Certificate. This removes the company from the restrictions on Foreign Investors that are imposed by the Foreign Business Act and allows it to engage in all business activities permitted under the Treaty of Amity.
A US Amity treaty company may not own land or engage in certain enterprises that are reserved for companies with majority Thai ownership (domestic trade in indigenous agricultural products, exploitation of land and natural resources, the liberal professions). It is also more difficult to hire foreign employees, but Plizz can assist with this process and advise on other options available.
Procedures
The US-Thai Treaty of Amity allows for American citizens to fully own or have majority shares in Thai companies. It also exempts them from some restrictions placed on foreign investors in Thailand. If you are considering setting up a company in Thailand, it is important to speak with an attorney to ensure that you meet all the requirements.
The first step is to submit documents proving your citizenship to the US Commercial Service office at the Embassy in Bangkok. These include your articles of incorporation, bylaws, and an affidavit stating that the company is owned by American citizens. If your company is a subsidiary of a parent company, you will need to provide the embassy with documents related to the parent company.
After the documents are certified by the CS, original copies must be submitted to the Ministry of Commerce for registration under the US-Thai Treaty of Amity. The Ministry of Commerce will then grant national treatment for the business entity.