Comments Off on Mercedes-Benz Investment – 100 Million Euros for Battery Production in Thailand
Together with their local partner Thonburi Automotive Assembly Plant Co. Ltd. (“TAAP”), Mercedes-Benz Cars are going to invest over 100 Million Euros in the existing car plant and a new battery production factory in Thailand. The investment shall extend the existing car plant and increase the product portfolio by adding new models. The new battery factory will be established close to the car plant of Mercedes Benz, expand over 48.000 sqm. This project shall be realized until 2020; the production of the batteries shall start in 2019, according to the Managing Director of TAAP, Veerachai Chaochankij.
The battery production factory in Thailand will be the sixth Mercedes-Benz battery factory worldwide. As part of the Mercedes-Benz Cars battery production network, it will ensure Mercedes-Benz a strong position in the global electromobility market: the new battery factory in Thailand shall not only cover local demand but also serve the export.
According to Markus Schäfer, Member of the Divisional Board of Management Mercedes-Benz Cars, Production and Supply Chain this strategy will enable Mercedes-Benz Cars to operate in “any region at short notice and the right size”.
According to Markus Schäfer, Member of the Divisional Board of Management Mercedes-Benz Cars, Production and Supply Chain this strategy will enable Mercedes-Benz Cars to operate in “any region at short notice and the right size”.
Comments Off on Starting a business in Thailand: Upcoming Bangkok Event
FRANK Legal & Tax will be holding another of our regular free events, designed to support the business community in Bangkok.
The upcoming event will provide an opportunity to explore the topic of starting a business in Thailand. Starting a new business can be both exciting and challenging, particularly in a foreign country. By attending our workshop, you will acquaint yourself with the legal procedures for opening a business in Thailand and be more familiar with the programs and opportunities available throughout the Kingdom. Please register using the form on this page.
In addition, Partner Fabian Doppler will briefly discuss the legal process for start-ups in Thailand.
Comments Off on How to obtain a driving license in Thailand
Foreigners who reside in Thailand and want to drive a car or motorcycle in Thailand should apply for a Thai driving license. The Thai driving license is essential since the international driving permit is not valid for driving in the country of residence. The purpose of an international driving permit is to translate the domestic driving license, certify the validity of the driving license in the country of residence, indicate the categories of motor vehicles that are covered by the driving license, and improve road safety worldwide.
Though Thailand has not signed the Vienna Convention on Road Traffic (1968), tourists are allowed to drive a car or motorcycle with an international driving permit in Thailand. This is due to the fact, that Thailand is still a member state of the Geneva Convention on Road Traffic (1949). However, the international driving permit is not a substitute for a valid domestic driving license and can only be used in a foreign country, other than the country of residence.
Provided that you are the holder of a foreign driver license, the application process for a driver license in Thailand is straightforward. Applicants need to submit the following documents at the Department of Land Transport to obtain the desired legal document:
the original valid driving license from your home country or an international driving permit and one copy
a translation of the license certified by the embassy if the license is not in English
the original passport and signed copies of the passport’s first page, the current non-immigrant visa and the last entry stamp
a residence certificate issued by the embassy/the immigration office, not older than 30 days or the original work permit and one signed copy as address verification
a medical certificate stating the applicant’s health condition, not older than 30 days; all hospitals provide standard medical certificates for the driving license application
Two photos (size 1 x 1 inch, photo service available at Department of Land Transport)
The Applicant has to submit the required documents at the Department of Land Transport personally, undergo a physical test and a one-hour driving seminar. It is recommended to apply for the car and motorcycle license at once. The applicant will need to submit two sets of the required documents.
Comments Off on Thailand’s Promotion of International Trading Centers
Under the Foreign Business Act (FBA), the business activities of foreigners in Thailand are restricted. Fortunately, there are various possibilities to obtain official permissions and programs to enhance international business in Thailand.
Thailand as a regional business hub and a leading center of commerce in Southeast Asia offers a wide range of incentives especially for International Trading Centers (ITC).
ITC’s are companies incorporated under the laws of Thailand with the objective of purchasing and selling goods, raw materials, and parts or providing international trading services to other companies incorporated under foreign laws.
To boost its position as the largest economy in mainland SEA, Thailand offers the following programs for ITCs:
BOI Promotion for International Trading Center
The Board of Investment (BOI) was established pursuant to the Investment Promotion Act for purposes of promoting certain foreign and domestic investments in Thailand.
Incentives offered by BOI for ITC activities:
Permission to bring in skilled personnel and experts into the Kingdom
Permission to work in investment promoted activities
Permission to own land
Exemption of import duty on machinery
Exemption of import duty on raw materials and parts used in the production for export
Regarding the key requirements for application, an ITC shall have not less than 10 Million THB paid-up capital.
RD Promotion for International Trading Center
ITCs may also be eligible to apply for certain tax privileges offered by the Thai Revenue Department (RD). The definition of ITC is set forth in the Royal Decree No 587 issued under the Revenue Code B.E. 2558.
Incentives offered by RD for ITC activities:
Corporate tax exemption for 15 years on any income derived from ITC activities
Personal Income Tax reduction to 15% on gross income and benefits for expatriates working in an ITC
Final Tax Exemption for dividends paid by the ITC to a company incorporated under foreign laws with no business in Thailand
In addition to the key requirements for the BOI promotion application, the expenses for operating in Thailand must be at least THB 15 Million per year.
The ASEAN is a fast-growing region. The programs shall leverage Thailand’s economy and stimulate international business. Incentives for ITCs are an excellent tool for bringing international trading to Thailand.
Comments Off on Permanent Residence Permit in Thailand
Holding a permit for permanent residency in Thailand has many benefits. A person with a permanent resident status can live permanently in Thailand without the need for a periodic stay extension. A permanent residence permit is the first step to become a naturalized citizen of Thailand. It entitles the non-Thai family members of the permanent resident to apply for such status as well.
A permanent resident of Thailand can become a director of a Thai public company, but the name on various documents (e.g. house registration), buy a condominium without transferring the money from abroad, and obtain a work permit without complicated paperwork.
The application for the permanent residence permit requires patience and persistence since the process might take up to one year. The applications are processed by the Royal Thai Immigration Commission every year during a specific period that varies each year but usually starts in October and ends in December.
Thailand has an annual quota of 100 persons per country. So only a few persons will be able to obtain permanent resident status. An applicant must meet the following criteria to become one of the top 100 people on the qualifying list:
Holding a Thai non-immigrant visa for at least three years, with three consecutive yearly extensions prior to the submission of the application
Holding a non-immigrant visa at the time of submitting the application
Meeting one of the following categories:
– Investment in Thailand (minimum investment 3-10 million Baht)- Work / Business in Thailand
– Family support or Humanity Reasons in Thailand
– Experts/academics
– Others as determined by Thai Immigration
Pass an interview (Thai language)
Note that the documents for the application depend on the specific category and should contain a detailed explanation of the reasons for the permanent residence permit. After approval, a permanent residence blue book and an alien registration book will be issued. The alien registration book is an equivalent of a Thai ID card.
The permanent residence permit never expires. Nevertheless, it can be revoked for some reasons. Furthermore, travelling out of Thailand and returning requires a re-entry permit even if holding a permanent residence permit. Finally, after ten consecutive years, a permanent resident can apply for Thai naturalized citizen status.
The expenses include an application fee (THB 7,600) that is not refundable and will be charged even if the applicant has been rejected. In case of permission, an additional fee of THB 191,400 is payable. If the candidate is married to a Thai citizen, the fee will be reduced to an amount of THB 92,400. After all, the candidate has to report every 90 days to an Immigration Office.
Comments Off on Hua Hin Court rules on Airbnb in Thailand
A court in Hua Hin, Prachuap Kirikan Province, has decided that Airbnb is illegal in Thailand, and thereby added to the uncertainty connected with the use of this very popular app.
Airbnb is a US-American company founded in 2008. It operates in the hospitality field and offers an online marketplace for individuals to rent or lease out their accommodation on a short-term basis.
In fact, the court has decided that people who rent out their rooms via Airbnb on a daily and weekly basis are acting illegally. Only rentals of 30 days or more would be, according to the court’s opinion, legal. The court ruling was handed down to the Wan Vayla Condo in Hua Hin district of Prachuap Khiri Khan province.
Airbnb competes with surrounding hotels that are bound by rules and regulations of the Hotel Act B.E. 2547. Hotels have to obtain a hotel license. Therefore, they have to comply with specific requirements to ensure their competence; these requirements also include security standards that shall protect the consumer.
According to the Hotel Act B.E. 2547, Section 4 “hotel” means an accommodation established for business purposes of providing temporary accommodation service for travelers in exchange for compensation. Temporary accommodation service means renting out rooms on a daily and weekly basis. This service requires a hotel license.
On the other hand, renting out accommodation for one month or more is not considered as hotel business. The same applies to the offering of small residential properties with less than four rooms and less than twenty guests in total for a temporary stay. These exemptions allow the owner to earn additional income and are not restricted by law.
Airbnb is a hot topic in the Thai hospitality industry whose interests are protected by an influential lobby. However, independent observers note that the new technology might have a positive effect on tourism and real estate investments. It will be interesting to see future developments in this matter.
Comments Off on FRANK Legal & Tax Featured in Thailand Starter Kit (ExpatDen) guide
We are delighted to have been featured in the well-respected professional blog Thailand Starter Kit (ExpatDen), in their recommended lawyers section. The two guides FRANK Legal & Tax are featured in highlight how to select a first-class lawyer in both Bangkok and Phuket.
Thailand Starter Kit was created with the intention to share know-how and experiences to make life easier for anyone looking to move, live and work in Thailand. It has since grown to be a renowned guide for anyone looking for information about services and life in Thailand.
The ethos of the publication is to provide free and unbiased guides for people who looking to live, work, retire or start a business in Thailand. At FRANK Legal & Tax, we understand the importance of our legal and tax advice for the business decisions of all our clients, in Thailand and further afield. We have expertise in all areas that are important to small and medium-sized businesses. Furthermore, in particular our Phuket offices specialize in real estate matters and offer in-depth expertise on an international level, for both real estate developers and buyers of property. Please don’t hesitate to contact us for inquiries at [email protected]
Comments Off on Approved minimum wage increase in Thailand
The wages council agreed to set a new minimum wage, which came into effect from April 1, 2018. The wage adjustment in 2018 is divided into 7 levels as follows;
Mr. Chakkarin, Permanent Secretary of Ministry of Labour, also made three additional proposals as follows;
Businesses with more than 50 employees must fix employees’ salary structure and guarantee that the wage will be raised every year.
The floating salary rates must be fixed as per the needs of operators in the area. There will be a pilot project in the Eastern Seaboard Economic Zone or EEC which are Chonburi, Rayong and Chachoengsao. This is designed to facilitate workplaces investing in skilled workers.
Prescription of tax incentives for operators who will have incur a higher cost of hiring labor. The rate that can be deducted from tax is 1.5 times
These mentioned proposals must also be re-examined by the new Wages Council.
If you would like any further information, please contact us: [email protected]
Comments Off on Foreclosure Procedures in Thailand
In the context of foreclosure, a creditor can use various methods to enforce his entitlements. When deciding on one of the foreclosure measures, the specifics of the case should be carefully considered to be most effective.
Please see below an overview of the available methods of foreclosure:
1. Principles of foreclosure
The basic conditions for enforcement are the same for almost all cases: You must have an enforceable court order. The debtor must have been served with a copy, and the application to appoint a bailiff should be filed to the court once the debtor does not comply with the judgment within the period prescribed by the court (normally 30 days).
If a third-party debtor is involved in the proceedings, the bailiff will be put in charge of the delivery of the attachment order. A third-party debtor is, for example, the employer to whom the creditor turns to seize the debtor’s wages.
Other foreclosure tasks are strictly and specifically assigned by the law: Attachments fall under the jurisdiction of the bailiff, estimates are made by an expert.
It is advisable not to wait too long to initiate an enforcement procedure, especially if several creditors apply for the seizure. In such a case, the order of the applications decides who receives the proportion of the garnishment proceeds in what amount.
2. Foreclosure measures at a glance
a. Account garnishment
The seizure of the account is a foreclosure measure involving the debtor’s bank. The creditor applies to the bailiff for a seizure and transfer order and sends it to the financial institution. Confiscated may be current and future bank balances of the debtor. The creditor shall file an application to receive the corresponding amount to the bailiff after a waiting period of four weeks.
For the debtor, these measures have far-reaching consequences. The bank withdraws his debit card, he can no longer carry out cash withdrawals. In addition, the function of standing orders and direct debits set up on the account ends. The debtor thus makes no payments for running costs such as rent or electricity.
b. Seizure of property (public auction)
If the debtor has properties (both movable and immovable property), enforcement of the properties may qualify as an appropriate method of enforcement. Relevant for immovable properties are land, buildings or condominium units. The prerequisite for this is that the debtor is registered as the owner (or heir of the owner).
For the public auction date, the court that is in charge of the enforcement sets a market value for the property. At auction, minimum bid limits must be met to ensure that the property is not auctioned well below value. With the award, the person who buys the property immediately becomes the new owner.
c. Attachment of claims or entitlements of the debtor, or other rights
Other options for attachment may involve the claims or entitlements of the debtor. These may be options on any claim that the debtor has, such as a claim on a rent, dividend, securities, or a car financed by a loan. Also, annuity or life insurance are claims which may be attachable.
Relevant may also be the attachment of intellectual property rights and other rights.
d. Wage garnishment
In the case of wage foreclosure, the creditor applies directly to the debtor’s source of income: with the employer. As soon as he receives the seizure order, the creditor obtains a seizure lien on the wage claim of the employee. The employer must pay the attachable part of the salary directly to the creditor. For social reasons, the seizure of wages or salaries is very restricted, always leaving the debtor with a living wage minimum. In Thailand, the monthly wage amount of less than 20,000 THB is not seizable.
e. Repossession
The seizure of property is, according to the Code of Civil Procedure, the standard form of foreclosure. Usually, the procedure is such that the bailiff visits the debtor at home and seizes movable property there.
In principle, he has the entire possession of the debtor at his disposal. However, certain items are exempt from the seizure: those that the person concerned needs for an adequate lifestyle. These include the clothes, the bed, the computer and the car. The things seized by the bailiff are kept in official custody and later auctioned off. The proceeds from this auction go to the creditor.
f. Asset information
In Thailand, it is the creditor’s burden to investigate the assets of the debtor and file a separate application in order to seize each asset. There is no possibility to file for asset information.
If the process results in a formal enforcement procedure, the debtor is threatened with a negative Credit Bureau entry, which diminishes his creditworthiness to possible business partners.
Comments Off on Thailand House and Land Tax Guidelines
Many foreign property owners are not aware of the so-called House and Land Tax (“HLT”). Properties that are subject to HLT include:
• Industrial or commercial buildings
• Houses or structures that are similar to houses
• The land on which industrial or commercial buildings or houses or structures similar to houses are situated.
The government body who is in charge of the collection of HLT depends on the location of the property, for example the Bangkok Metropolitan Administrative (สำนักงานเขตกรุงเทพมหานคร), Municipality Office (สำนักงานเทศบาล), and Tambon (Village) Administrative organizations (องค์การบริหารส่วนตำบล)
Properties that fall into the HLT category pay a tax of 12.5 % of the annual rental value or the annual assessed rental value, whichever is higher. An owner of buildings or other structures on land being consistently used is obliged to file a tax return to the District Office and pay tax by the end of February each year or within 30 days from the date of receipt of the assessment order. The correct form to submit is called “Por Ror Dor 2” in English or “ภ.ร.ด. 2” in Thai. This form is completed with the official statement of the annual rental value of the property for the preceding year. The relevant administrative district may then use this information to re-evaluate the amount of tax due.
An appeal may be filed with the District Office against the assessment order within 15 days. Further appeals may be filed with the Court within 30 days.
In cases where the total tax bill is 9,000 THB or more, a written request may be made to the relevant authority to spread the payment over three equal installments. This must be requested prior to the payment deadline.
Please note that a new property tax system is currently in the process of legislation and it does not include the HLT, so will likely be replaced in the near future. If you have any questions about property tax in Thailand, please contact us at [email protected]
