Starting a Company in Thailand: 7 Decisions Before Registration

A Thai private limited company is a common operating structure for foreign investors establishing a business presence in Thailand. It is a separate legal entity with capital divided into shares, and each shareholder's liability is generally limited to any unpaid amount on the shares they hold.

The important distinction is that company registration and permission to conduct a particular business are not the same decision. A company can be successfully registered while its intended activity still requires a licence, certificate, promotion or a different ownership structure.

1. Define what the company will actually do

Write the intended activities in plain commercial language before selecting standard registration objectives. What will the company sell? Who will it sell to? Will it provide services, trade goods, manufacture, employ staff, hold property or receive income in Thailand?

This comes first because the Foreign Business Act restricts specified activities carried on by a business treated as foreign. The answer depends on both the ownership and the actual activity. A broad list of registered objectives does not, by itself, grant permission to conduct a restricted business.

2. Determine whether the company will be treated as foreign

Under the Foreign Business Act, a Thai-registered juristic person is treated as a foreigner where foreigners hold at least half of its capital shares. If the proposed company falls within that definition, its planned activities must be checked against the restricted-business lists and any sector-specific laws.

3. Identify the promoters and intended shareholders

A Thai private limited company must be promoted by at least two individuals. Each promoter signs the memorandum and subscribes for at least one of the initial shares; a promoter cannot be a corporate entity. Once the company is established, its shareholders may be individuals or corporate entities. Decide the intended ownership percentages, the number of shares and which shareholders will ultimately hold them.

Ownership should reflect the genuine commercial arrangement. It should not be selected merely to make a filing appear to fit a threshold. If the business will have foreign investment, confirm the ownership and permitted-business analysis together.

4. Set capital for the real operating plan

Choose registered capital by looking at the company's expected operations, funding, licensing, staffing and immigration needs rather than selecting an arbitrary number. At incorporation, at least 25% of the par value of subscribed shares must be paid.

Additional minimum-capital rules can apply where a foreigner commences business in Thailand, including higher statutory minimums for activities requiring permission under the Foreign Business Act. Those rules should be assessed separately from the basic company-registration filing.

5. Decide who manages the company and who can bind it

A limited company is managed by its director or directors under the control of the shareholders' general meeting. Before filing, decide who will serve as director and specify the signing authority that will bind the company - for example, whether one director may sign alone or whether two signatures are required.

This is a commercial-control decision, not a clerical field. Banks, counterparties and internal teams will rely on the registered signing rule when the company enters transactions.

6. Confirm a usable registered office

The memorandum identifies the part of Thailand where the registered office will be situated, and the registration records the principal business-office address. Confirm that the address can be properly documented and used for official communications.

If the company will later require tax, VAT, sector or employment registrations, check whether the premises and supporting documents will also work for those later steps. Incorporation is only the first operational checkpoint.

7. Convert the decisions into the DBD registration sequence

Once the structure is settled, the registration sequence becomes much clearer: reserve the company name, prepare and register the memorandum, subscribe the shares, hold the statutory meeting, pay the required share capital, appoint the director or directors, and register the company with the Department of Business Development.

The memorandum records core matters including the proposed name, registered-office province, objectives, limited-liability statement, capital and promoter details. The incorporation filing then records matters such as subscribed shares, paid-up amounts, directors, signing authority and the business-office address.

A quick readiness test

• We can describe the company's intended activities in plain language.
• We have checked whether the ownership makes the company foreign under Thai law.
• We understand whether the intended activities require a permission, certificate or promotion.
• We have at least two individual promoters subscribing for the initial shares, and we have separately identified any intended corporate shareholders.
• We have chosen capital that matches the operating plan and can fund the required paid-up amount.
• We know who the directors will be and how the company will be bound by signature.
• We have a documentable registered office and suitable company-name options.

If every answer is clear, you are ready to prepare the registration brief. If the activities, foreign-ownership treatment or control structure remain uncertain, resolve those points before generating the documents. A reliable setup is one in which the commercial plan, ownership and permitted activities all point in the same direction.

Source basis and scope

This general guide was prepared from Corporly's legal-reference store and cross-checked against Luther's July 2024 memo, 'Establishing a corporate set-up in Thailand.' It is designed as an initial decision guide. Activity-specific licensing, tax, immigration and investment-promotion requirements require a separate scope assessment.