Thailand BOI’s New Initiatives: Attracting Global Events and Boosting PCB Manufacturing
Comments Off on Thailand BOI’s New Initiatives: Attracting Global Events and Boosting PCB ManufacturingThailand Board of Investment unveils incentives for international events and expands support for PCB manufacturing supply chain.
To strengthen Thailand’s tourism sector, the Thailand Board of Investment (BOI) has announced new incentives aimed at attracting large-scale international events to the country. The board has greenlit measures to lure high-profile concerts, sporting events, and festivals, aligning with the government’s vision to position Thailand as a premier tourism destination and revive the sectors post-Covid-19 crisis.
The incentives, approved during a recent meeting, include import duty exemptions on equipment for organizers of major events requiring investments or expenses exceeding 100 million baht (approximately USD 2.8 million). Additionally, the BOI will facilitate the temporary entry of foreign staff essential for event organization. However, it’s noteworthy that these measures do not extend to conferences and trade shows.
By reducing costs, lead times, and logistical hurdles, the BOI aims to support the resurgence of Thailand’s tourism sector, a vital contributor to the country’s economy, constituting approximately 20% of GDP.
On a similar note, the BOI has also extended incentives to cover the entire supply chain of Printed Circuit Board (PCB) manufacturing. In 2023, the BOI approved investment promotion benefits for 40 PCB projects, attracting investments totaling USD 2.66 billion (around 96 billion baht). These projects, spearheaded by companies from China, Taiwan, Japan, and Thailand, signaled a significant shift of PCB production hubs to Thailand.
To further enhance foreign investment in PCB manufacturing and foster a comprehensive ecosystem, the BOI has broadened the definition of eligible businesses to include manufacturers of PCB parts and providers of related services. This encompasses various aspects such as lamination, drilling, plating, routing, electrical testing, and the production of essential materials like copper clad laminate (CCL), flexible copper clad laminate (FCCL), and PREPREG.
With these initiatives, the Thailand BOI continues its mission to promote economic growth, attract foreign investment, and enhance the country’s competitiveness on the global stage.
If you would like to know how your business can get access to the various incentives of the BOI in Thailand, please contact us at [email protected].
Andreas Seela
Connect with me on LinkedIn
Andreas, Associate at FRANK Legal & Tax, is a licensed German lawyer with expertise in corporate/commercial, real estate, and tax law, and has been living and working in Thailand since 2023.
Retirement in Thailand: A Closer Look at Long-Term Visa Options for Retirees
Comments Off on Retirement in Thailand: A Closer Look at Long-Term Visa Options for RetireesPlease see the detailed information in our PDF file below:
If you have any questions regarding the retirement visa, please do not hesitate to contact us at [email protected]
Fabian Doppler
Connect with me on LinkedIn
Fabian, a founding partner of FRANK Legal & Tax, is a German-trained lawyer with expertise in corporate/commercial and real estate law, and litigation, and has been living and working in Thailand since 2005.
Secure Your Online Presence in Thailand: A Guide to Domain Registration
Comments Off on Secure Your Online Presence in Thailand: A Guide to Domain RegistrationThis article will take you a deep dive into the general overview of domain registration in Thailand. It is not a substitute for legal advice, and the specific requirements may change. We recommend consulting with a Thai legal professional for the latest information.
Understanding Domain Levels in Thailand
In Thailand, domain registrations are handled by thnic.co.th. There are two main domain levels to consider:
- Second-Level Domain (SLD)
This is the top-level domain, like “.th” in “yourdomainname.th”. Registration periods are limited and require stricter eligibility criteria. - Third-Level Domain (3LD)
These domains come in various categories like “.co.th” for businesses or “.in.th” for individuals. Registration is open year-round with broader eligibility.
Who Can Register a Domain in Thailand?
Eligibility for domain registration depends on the chosen level:
- Second-Level Domain: Only Thai citizens, Thai companies, or owners of the trademark registered in Thailand can register.
- Third-Level Domain
Eligibility is wider a Thai citizens, Thai companies, Foreigners with a Thai work permit, and Owners of trademarks registered in Thailand or abroad.
Documents Required for Registration
The required documents vary depending on your eligibility and chosen domain level. Here’s a general breakdown:
Second-Level Domain:
- Thai company: Company affidavit or VAT certificate
- Thai citizen: ID card
- Trademark owner: Thai trademark registration certificate
Third-Level Domain:
- Thai company: Company affidavit or VAT certificate
- Trademark owner: Trademark certificate (Thai or foreign)
Costs Associated with Domain Registration
The Ministry of Finance will lead the efforts to enact laws and establish operational guidelines to implement these measures, which include:
- Second-Level Domain:
- Application fee: 10,000 THB
- Registration fee (if accepted): 100,000 THB per year
- Third-Level Domain:
- Registration fee: 856 THB per year
Important Considerations
- The domain name must exactly match your registered trademark for registration.
- Domain registrations are processed on a first-come, first-served basis.
Feel free to contact us if you have questions about domain registration in Thailand at [email protected]
Fabian Doppler Connect with me on LinkedIn
Fabian, a founding partner of FRANK Legal & Tax, is a German-trained lawyer with expertise in corporate/commercial and real estate law, and litigation, and has been living and working in Thailand since 2005.
Thailand Joins Global Efforts to Reform International Taxation
Comments Off on Thailand Joins Global Efforts to Reform International TaxationIn the context of international tax reform, Thailand has aligned itself with over 140 economic zones by becoming a member of the International Cooperation Framework on Base Erosion and Profit Shifting (OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting). This framework, commonly referred to as the Inclusive Framework on BEPS, has recently endorsed a comprehensive two-pillar solution aimed at addressing tax challenges stemming from the digital economy.
The Revenue Department has now unveiled the guiding principles of this solution, marking a big step in Thailand’s commitment to global tax cooperation. However, it’s important to note that the draft is currently undergoing review, and stakeholders are encouraged to voice their concerns or provide input until mid-March 2024.
Thailand Taxation
The key components can be broken into two pillars:
Pillar 1: Profit Allocation and Tax Collection Rights
Multinational enterprises (MNEs) will be mandated to allocate profits and tax collection rights in a manner that accurately reflects the value generated in each jurisdiction. This initiative aims to ensure a more equitable distribution of tax revenues, particularly in the rapidly evolving digital sector.
Pillar 2: Minimum Corporate Income Tax
Introduces the concept of a global minimum corporate income tax rate, designed to deter profit shifting and tax avoidance strategies employed by multinational groups. Under this proposal, MNEs with revenues exceeding EUR 750 million will be required to pay income tax at an effective rate of no less than 15 percent. The legislation is slated to come into effect in 2025. Notably, Thailand plans to allocate a significant portion, ranging from 50 to 70 percent, of the additional tax collected to its National Competitiveness Enhancement Fund for Target Industries.
The Ministry of Finance will lead the efforts to enact laws and establish operational guidelines to implement these measures, which include:
- Collecting additional taxes in line with the principles outlined in Pillar 2.
- Allocating income from the additional tax collection to a dedicated fund aimed at bolstering the competitiveness of target industries.
- Submitting information on additional taxpayers to the Office of the Board of Investment.
In light of these developments, the Revenue Department has issued a call to action for stakeholders to contribute their feedback and suggestions on the principles of the draft law. Interested parties are encouraged to submit their comments via the comment form available on the central legal system website or the Revenue Department’s website between March 1, 2024, and March 15, 2024.
Thailands commitment to implementing the OECD/G20 two-pillar solution underscores its approach to international tax cooperation and aligns with global efforts to ensure a fair and sustainable tax system in the digital age.
If you have any questions about a Taxation in Thailand, please contact us at [email protected].
Andreas Seela
Connect with me on LinkedIn
Andreas, Associate at FRANK Legal & Tax, is a licensed German lawyer with expertise in corporate/commercial, real estate, and tax law, and has been living and working in Thailand since 2023.
Navigating Trademark Registration in Thailand: Criteria, Requirements, and Process
Comments Off on Navigating Trademark Registration in Thailand: Criteria, Requirements, and ProcessTrademark registration is an important step for businesses to protect their intellectual property and establish brand identity in Thailand’s dynamic market. Thailand offers a robust legal framework for trademark protection, governed by the Trademark Act B.E. 2534 (1991) and subsequent amendments. However, navigating the trademark registration process can be complex, requiring a thorough understanding of the criteria, requirements, and procedures involved.
Registrability criteria
The Trademark Act amendments in 2016 expanded the definition of a mark in Thailand, including diverse forms such as photographs, drawings, logos, names, words, phrases, letters, numerals, signatures, combinations of colors, figurative elements, and even sounds. However, for eligibility, these marks must meet specific criteria.
Trademarks must possess distinctiveness, avoiding direct references to the character or quality of associated goods or services. Descriptive marks are discouraged, but a mark initially lacking distinctiveness can acquire it through extensive use and promotion over time. The Department of Intellectual Property (DIP) in Thailand accepts various forms of evidence to demonstrate mark use, including receipts of sales, marketing and advertisement receipts, and purchase orders. This evidence should be directly related to the sales or advertising of products or services associated with the mark.
Thai law prohibits marks falling into the following categories: those contrary to public order, morality, and public policy; those confusingly like well-known marks; those comprising geographical indications protected by law; and those using seals, emblems, flags, names, etc., related to or used by Thai government entities, the Thai royal family, foreign states, and international organizations.
To avoid conflicts with existing trademarks, applicants are advised to conduct a trademark availability search before filing a new application. This search can be executed using the DIP online database in Thailand, and similar search engines are available for trademark data in ASEAN countries and internationally on WIPO’s website.
Requirements
Commencing the trademark registration process in Thailand involves the submission of the “Kor.01” application form, either directly at the DIP or through the online filing platform. Throughout this process, several essential documents and information are required for a successful application.
One element is the Power of Attorney, a notarized document executed by the applicant or their legal representative. This document appoints the agent in Thailand and includes vital details about the applicant, such as name, address, nationality, or country of incorporation. For Thai nationals or corporations, a simply signed Power of Attorney, without notarization is accepted. This should be accompanied by a signed copy of the applicant’s national identity card (for individuals) or the company registration certificate (for corporations).
Another component is the Specimen of the Mark, encompassing various considerations depending on the nature of the mark. Whether it’s a word, picture, or sound, the specimen should be clear. For word marks in a foreign language, it is required to provide the meaning and transliteration in Thai. In the case of 3D marks, seven views must be submitted, covering the front, back, left, side, top, bottom, and perspective. Sound marks require a description, along with a recording not exceeding 30 seconds.
Applicants must also submit an Enumeration of Goods/Services, outlining the specific goods or services associated with the intended mark. Notably, late filing of the notarized Power of Attorney copy is permissible upon request within 90 days from the trademark application date. Additionally, the calculation and payment of Filing Fees are crucial steps in the process. The fees are determined based on the number of designated goods or services and the number of classes.
It must be noted that certain formal elements of the application, such as the applicant’s address, can be amended post-filing. However, amendments to the list of goods and services and the specimen of the mark are subject to the registrar’s request or may be necessary to align with local practices.
Registration Process
The trademark registration process in Thailand unfolds over a span of approximately 12 to 16 months. Following the initial application filing, the registrar is reviewing it with regards to both formal and substantive prerequisites outlined in the relevant laws and regulations. In cases of non-compliance, the registrar issues either a refusal to register the mark, deeming it prohibited, nondistinctive, or similar/identical to prior marks, or an office action prompting the applicant to amend the application or furnish additional documents.
In response, the applicant has a 60-day window to address the registrar’s concerns. This may involve filing an appeal before the Trademark Board if faced with a refusal or a request to disclaim a non-essential element of the mark. The appeal process typically spans 2 to 3 years before a decision is made.
Simultaneously, amendments must be filed to align with the registrar’s directives, taking around 3 to 6 months to process. Failure to respond within the stipulated time leads to application abandonment.
Should no objections be raised by the registrar, the application undergoes publication in the Thai Trademark Gazette around 9 to 10 months after the filing date. This publication invites a 60-day period during which third parties can contest the trademark based on superior rights or non-compliance with the Trademark Act.
Upon notification of opposition, the applicant has 60 days to issue a counterstatement; otherwise, the application is deemed abandoned. The registrar’s decision on opposition takes about a year, subject to potential appeals before the Trademark Board, Court of Appeal for Specialized Cases, and the Supreme Court.
In the absence of opposition, the registrar prompts the applicant to pay the registration fee. The applicant has 60 days to complete this payment. Simultaneously, the Certificate of Registration can be obtained, and the trademark is registered for a 10-year term from the Thai filing date, renewable indefinitely every 10 years.
The registered trademark gives the rights outlined in the TRIP Agreement, primarily entailing exclusive usage rights for the designated goods and services. It also empowers the prevention of third parties from utilizing a similar trademark for analogous services and goods.
If you have any questions about Trademark Registration in Thailand, please contact us at [email protected].
Andreas Seela
Connect with me on LinkedIn
Andreas, Associate at FRANK Legal & Tax, is a licensed German lawyer with expertise in corporate/commercial and real estate law, and tax law, and has been living and working in Thailand since 2023.
Non-Disclosure Agreements: A Necessity in Business
Comments Off on Non-Disclosure Agreements: A Necessity in Business
In a world characterized by an ever-increasing exchange of information, non-disclosure agreements play a significant role in business life. For a collaboration between business partners, it is essential to exchange sensitive data, for example know-how, financial data, or business secrets.
However, this can also be accompanied by high risk. Passing forward information to unauthorized third parties can result in considerable damage, such as financial losses, and can also limit and damage the competitiveness of the company. It is therefore essential to conclude legal agreements to protect sensitive information.
So, a non-disclosure agreement (NDA) is essential. It is a contractual agreement aimed at protecting sensitive information from unauthorized disclosure, and it is covered by freedom of contract.
To increase the effectiveness of NDAs, compliance with certain standards is essential:
- All parties involved must be clearly named.
- The specific information must be precisely defined.
- The duration of the agreement should be specified.
- Possible contractual penalties for non-compliance should be determined.
The correct application of these agreements not only helps to strengthen trust between the parties but also forms a fundamental basis for innovation and growth in a globalized and information-driven economy. Therefore, NDAs serve as an effective tool to minimize the risk of information falling into unauthorized hands.
Feel free to contact us if you have questions about non-disclosure agreement at [email protected]
Fabian Doppler Connect with me on LinkedIn
Fabian, a founding partner of FRANK Legal & Tax, is a German-trained lawyer with expertise in corporate/commercial and real estate law, and litigation, and has been living and working in Thailand since 2005.
Thailand’s EEC Unveils 5-Year Development Plan and New Visa Scheme
Comments Off on Thailand’s EEC Unveils 5-Year Development Plan and New Visa SchemeThe Eastern Economic Corridor (EEC) Policy Committee in Thailand has greenlit an ambitious 5-year development plan for 2023-2027, aiming to accelerate growth, attract substantial investments, and position the region as a hub for high-tech industries. The EEC envisions a surge in investment over the next half-decade, with a target of 500 billion baht. The plan also aims to boost the gross provincial product of EEC provinces by 6.3%. The EEC, which covers three provinces east of the capital, Bangkok, is a centerpiece of government efforts to boost growth and encourage investment, particularly in high-tech industries.
The comprehensive development plan is multifaceted, concentrating on promoting targeted industries, enhancing infrastructure, nurturing a skilled workforce, developing modern urban centers, and ensuring sustainable community growth.
New Visa Scheme for Foreign Investors
To attract foreign investments, a new visa scheme is set to be launched in 2024. Investors in the EEC will be eligible for 10-year visas, coupled with multiple benefits to facilitate their engagement in the region.
Visa holders will enjoy expedited work permit processing, a flat 17% personal income tax rate, a 10-year-long visa duration, streamlined online reporting, and access to fast-track channels at international airports. This Visa scheme will include categories for specialists, executives, professionals as well as spouses and dependents.
Economic Strategy
The EEC’s development plan aligns with Thailand’s broader economic strategy, aiming to revitalize growth and attract investments, particularly in high-tech sectors. This initiative is strategically crucial amidst an economic slowdown.
Key Industries and Incentives
Target industries in the EEC include next-generation automotive, smart electronics, biotechnology, robotics, aviation, and digital technology. Further benefits for business operators focus on five key principles: innovation in public service delivery, consideration of benefits to be received, assessment of granting benefits, collaboration between agencies, and monitoring and evaluation.
The EEC’s 5-year development plan, coupled with the innovative visa scheme, not only enriches economic growth but also positions Thailand as a prime destination for foreign investments. This strategic initiative is poised to create a thriving ecosystem for innovation, job creation, and sustainable development in the region.
If you have any questions, please feel free to contact us at [email protected] or via +66 02 026 3284.
Andreas Seela
Andreas, Associate at FRANK Legal & Tax, is a licensed German lawyer with expertise in corporate/commercial, real estate, and tax law, and has been living and working in Thailand since 2023.
Managing Wealth Across Generations – Family Offices in Thailand
Comments Off on Managing Wealth Across Generations – Family Offices in ThailandA family office is a private wealth management firm that provides comprehensive financial services to a wealthy family or a single high-net-worth individual. These services typically include investment management, estate planning, tax optimization, philanthropic advising, and more. Family offices are tailored to the specific needs and goals of the family or individual, offering personalized financial solutions to help preserve and grow their wealth across generations. They can be single-family offices, serving one wealthy family exclusively, or multi-family offices, serving multiple families with similar financial needs.
A family office typically employs staff to manage various aspects of the family’s financial affairs and personal matters. The size and composition of the staff can vary widely depending on the complexity of the family’s financial situation and their specific needs. Some common positions within a family office may include investment professionals, accountants and tax specialists, estate and wealth planners, and personal assistants. The roles and staff composition can vary significantly based on the family’s priorities and resources.
A family office typically holds and manages assets for the wealthy family or individual it serves. These assets can include various investments and holdings, such as financial investments, real estate, and business interests.
Thailand has specific restrictions on foreigners operating family offices in the country, most notably under the Foreign Business Act, B.E. 2542. For this reason, Thailand is usually not considered one of the favored locations for family offices in the international context.
However, family offices are certainly common in Thailand for wealthy Thai families and families with multiple nationalities among the family members.
Feel free to contact us if you have questions about establishing a family office in Thailand at [email protected]
Fabian Doppler Connect with me on LinkedIn
Fabian, a founding partner of FRANK Legal & Tax, is a German-trained lawyer with expertise in corporate/commercial and real estate law, and litigation, and has been living and working in Thailand since 2005.
Leasehold vs Usufruct for Foreigners
Comments Off on Leasehold vs Usufruct for ForeignersProperties in Thailand do not serve only as investment assets but also as residences and business premises, attracting both locals and foreigners.
While Thai law still restricts foreigners from owning certain estates in Thailand, ownership is not the sole means of leveraging property in Thailand. Thai legal framework offers various alternatives for individuals, including foreigners, to exploit the property’s potential regardless of the ownership. This flexibility allows foreigners to derive significant benefits from properties, with a prime example being land, which they are prohibited from owning but can lease.
Leasehold
The Thai Civil and Commercial Code governs property leasing in Sections 537 to 571. Leasehold is one of the prominent methods to acquire property in Thailand as a foreigner.
A leasehold is recognized for its characteristics as a long-term legal structure. Section 540 of the Thai Civil and Commercial Code states that the long-term time frame would run up to a maximum of thirty years and may be renewed for another thirty years. Nonetheless, if such land is used for commercial purposes, it may be leased for up to fifty years and renewed for another fifty years.
There are a few steps that the lessee needs to comply with in order to successfully register the lease and get the most advantage of the leasehold. Section 538 of the Thai Civil and Commercial Code has set forth the key requirements: it must be made in writing and registered with the competent official at the land office; otherwise, it will only be enforceable for three years. Apart from the benefit of long-term use, there are other significant characteristics the lessee would acquire.
After the lease is registered, the lessee would have full rights over such property; however, the lessee is only allowed to use such property for the purpose that is agreed in the contract. Any other use, such as subletting, would require the lessor’s consent. Therefore, an action excluded from either party’s scope would be considered a breach of contract. Despite the leasehold rights over such property, the lessee must be aware that the lessor still holds the right to put such property for sale or into mortgage; if this were the case, the lessee’s rights would not be affected and would remain the same.
Moreover, the lessor and the lessee may agree that the right to lease shall be inheritable. The Thai Supreme Court Judgement no.11058/2559 has affirmed and ruled regarding the inheritance of the right to lease.
Due to the low legal threshold, leasehold became a commonly used method among individuals, particularly foreigners, who want to fully enjoy the property apart from having ownership.
Usufruct
On the other hand, Thai law provides an alternative choice from a lease with slightly different characteristics. It is known as usufruct and is set forth under Section 1417 of the Thai Civil and Commercial Code. Usufruct has become one of the main alternatives to leasehold for individuals who want to benefit from a property other than having ownership. This means the beneficiary, recognized as the usufructuary, will only have the right to possess the property. Similarly to leasehold, the period when the usufructuary can benefit from the property can be agreed upon between the parties; however, the main difference is that the usufructuary does not have a maximum usage period. It can be arranged to lead up to the lifetime of the usufructuary without a need for renewal, which makes it less complicated than a leasehold.
Even though usufruct enables the usufructuary to benefit from such property for a lifetime period, still, the usufructuary may only benefit from the existing property that is registered for usufruct while rights to alter, demolish, or change any substance of the property are prohibited unless it has been consented by the owner. A primary example would be where the usufructuary can lease out the property without seeking prior consent from the owner.
Although the property owner would have more privilege than the usufructuary, Thai law has implemented a regulation to prevent any default regarding the prevailing ownership. It is provided that any transaction that would create encumbrance due to usufruct would require the consent of all the parties. For example, if the property owner wishes to sell such property, the approval of the usufructuary would also count as a requirement of such a sale. This would also give the usufructuary the right to prevent the property owner from selling or mortgaging such property.
Even though the usufruct can be agreed upon for a lifetime, such a right is deemed a personal right that is not inheritable. It must terminate with the death of the usufructuary or when it reaches the expiration term as agreed upon by both parties.
The chart below provides an overview of the above-mentioned two legal structures:
Conclusion
Due to the numerous advantages, leasehold, and usufruct stand out as favored approaches that allow foreigners to unlock the potential use of property in Thailand. These benefits make them valuable tools for individuals seeking to benefit from the property for an extended period despite not having ownership.
Nevertheless, it is still critical to consider that each method has limitations, and it may not serve the needs in every case. It is crucial to carefully assess the most suitable option to ensure the desired utilization of the property.
Please do not hesitate to contact us if you have any questions regarding leasehold or usufruct at [email protected]
Fabian Doppler Connect with me on LinkedIn
Fabian, a founding partner of FRANK Legal & Tax, is a German-trained lawyer with expertise in corporate/commercial and real estate law, and litigation, and has been living and working in Thailand since 2005.
Important Updates on New Tax Regulations for Foreign Income in Thailand
Comments Off on Important Updates on New Tax Regulations for Foreign Income in ThailandKey Information on Revenue Department Order No. 162/2023
Additionally, to the Q & A paper on the new tax regulations published by the Thai Revenue Department, the Thai Tax Authority published the Revenue Department Order No. 162/2023 on 20. November 2023.
This order states, that the following paragraph shall be added to the Revenue Department Order No. 161/2023 regarding income tax payment according to Section 41, paragraph two of the Revenue Code, dated September 15, 2023:
“The provision in paragraph one shall not apply to assessable income arising before January 1, 2024.”
This is an important clarification, because it means that for income that was received before this date, the old rules still apply. This order shall take effect for income brought into Thailand starting from January 1, 2024. This means it applies to income assessable from foreign sources at the domicile of the income earner from the tax year 2024 onwards. Therefore, for income from foreign sources generated before the tax year 2024, the previous principle still applies: the income must be brought into Thailand in the same tax year it is earned, and individuals are not required to pay personal income tax according to the Revenue Code. This is because it does not comply with the traditional interpretation.
Why this new amendment is important shows the following example:
A person is living in Thailand for more than 180 days a year but receives income outside of Thailand since the last 10 years and transfers this money into Thailand. Starting from 01. January 2024, this income will be subject to tax regardless of when it was earned. Due to the new clarification, the taxation does not apply to income he is transferring into Thailand, if he can prove that the income was earned before 2024.
Before this Order 162/2023, the regulations could be read that he has to pay taxes starting from 2024 on any income he is transferring into Thailand, regardless of when it was earned. This assumption is now corrected. Income that was earned in for example 2020 can still be transferred into Thailand after 01. January 2024, without being subject to tax, if it can be proved that this income was earned in 2020.
If you have any questions about minimizing your tax burden in Thailand, please contact us at [email protected].
Andreas Seela
Andreas, Associate at FRANK Legal & Tax, is a licensed German lawyer with expertise in corporate/commercial, real estate, and tax law, and has been living and working in Thailand since 2023.
