Representative Office in Thailand

Representative Office in Thailand. With its robust economy and strategic location, Thailand provides a fertile ground for business expansion. For foreign companies looking to explore business opportunities, understand the market, or oversee their interests in Thailand without conducting direct sales, establishing a Representative Office can be an ideal option. This article will guide you through the process of setting up a Representative Office in Thailand, focusing on the eligibility, requirements, and steps involved in this process.

Eligibility for a Representative Office in Thailand

Foreign companies intending to open a Representative Office in Thailand must meet the following criteria:

1. The parent company must have been established for at least three years.
2. The parent company must allocate a minimum capital fund of 2 million Thai Baht for the Representative Office’s operation, to be brought in over a period of five years.
3. The Representative Office should not derive any income from its activities in Thailand.

It’s important to note that a Representative Office can only undertake non-revenue-generating activities. These can include sourcing goods or services in Thailand for its head office, checking and controlling the quality and quantity of products ordered by the head office, and providing advice concerning products of the head office sold to agents or consumers.

Requirements for Setting up a Representative Office in Thailand

To set up a Representative Office, you will need the following:

• Application form and relevant documents outlining the objectives and details of the proposed Representative Office
• Financial statements of the parent company for the last three years
• Details of the parent company, including its profile and business operations
• The list of intended activities of the Representative Office
• Information about the proposed office manager, including their CV and a copy of their passport or ID

It’s also important to note that the Representative Office cannot receive payments from the provision of services, cannot purchase or sell goods on behalf of the parent company, and cannot have the cost of operations directly borne by its clients.

Steps to Set Up a Representative Office in Thailand

1. Application Submission: The first step involves applying to the Department of Business Development (DBD) or at the One-Stop Service Center for Visas and Work Permits if the Representative Office intends to hire foreign staff. This application should include all the necessary documents, including the details of the parent company, the financial statements, and the objectives of the Representative Office.
2. Review and Approval: The authorities will review your application, which can take up to 60 days. If approved, the business operations can start immediately.
3. Registration: Following approval, the Representative Office needs to be registered as a foreign business operating in Thailand.
4. Capital Transfer: The minimum capital of 2 million Thai Baht should be remitted to the Representative Office within the specified period.
5. VAT Registration: If applicable, the Representative Office must register for VAT with the Revenue Department.
6. Staff Employment: If foreign staff are employed, they must obtain appropriate visas and work permits.

Conclusion

Setting up a Representative Office in Thailand is a strategic way for foreign companies to explore the Thai market and manage their business interests. Understanding the eligibility, requirements, and steps in this process can ease your business setup journey in Thailand. As always, consulting with a local legal expert or business consultant can be beneficial to navigate the local regulatory landscape effectively and ensure your business operations are compliant with Thai laws.