Business
Incentives
Overview:
The Investment Promotion Act of 1977 (the "Promotion Act")
is intended to foster foreign and domestic capital and technology
investment in Thailand. The Promotion Act is administered by
the Board of Investment (the "BOI"), whose function
is the administration of the Promotion Act and the promotion
of domestic and foreign investments which qualify under the
Act. The BOI seeks to promote those business investments and
activities that are considered important and useful to the social
and economic development of Thailand. The Board broadly defines
priority areas for investment, identifies investment opportunities
for investors, provides services to investors, and decides which
investments qualify for special status and privileges under
the Promotion Act and BOI regulations.
The
BOI maintains a list of activities eligible for promotion and
considers additional activities when it receives promising proposals.
The BOI places special, but by no means exclusive, emphasis
on industries that are labor intensive, agricultural, or export-oriented.
There is no requirement that a business eligible for promotion
apply for such prmotion, but it is generally in the business's
interest to apply for BOI promotion.
Two
governmental entities have been empowered to grant business
incentives. Privileges regarding general investment, based on
the location of the enterprise, are granted by the Board of
Investment of Thailand (BOI). Currently, three regional areas
are zoned and different investment privileges are contained
therein. The Thai government also attempts encourage more investment
outside of Bangkok by providing greater incentives to projects
located in rural zones.
The
Industrial Estate Authority of Thailand (IEAT) is the
other governmental body that grants business incentives to foreign
companies. Enterprises which have been developed by IEAT or
are a joint venture between private entities and the IEAT are
granted investment privileges if they are located in an industrial
estate.
The
Investment Service Center will assist promoted companies with
applications for factory and other licenses necessary to operate
the promoted business. They will also assist with land, work
permit and immigration matters.
The
BOI periodically publishes a list of activities currently being
promoted. Each category has minimum capital requirements and
most have minimum Thai shareholding requirement and other conditions:
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