FBA proposed amendments

Voting rights to determine foreign firms. Compliance schedule still under discussion

Source: Bangkok Post - 27 December 2006

Voting rights will be used as a key criterion in defining foreign ownership under the planned revision of the 1999 Foreign Business Act. A Commerce Ministry committee chaired by Pramon Sutivong finalized the new definition yesterday. Mr. Pramon, who also chairs the Thai Chamber of Commerce, said the revised law that companies controlled by foreigners in terms of voting rights would be classified as foreign, even if their direct shareholdings were in a minority. ‘The new criteria could affect a number of companies that would now be in violation of the Foreign Business Act', he acknowledged.

Shin Corp Deal

On Monday January 23, 2006, three days after the Thai Telecommunication Act (2006) became effective on Friday January 20, the Shinawatra-family sold its remaining 49.6% stake in Shin Corporation, a leading Thai telecommunications company, to two nominees of Temasek Holdings (Cedar Holdings and Aspen Holdings). The Shinawatra and Damapong (Potjaman's maiden name) families netted about 73 billion baht (about $1.88 billion). Following Thai tax laws, they did not have to pay capital gains tax. Kularb Kaew was the holding company used to acquire Shin Corp.

Investment in Thailand

Source: Bangkokpost - 1 August 2006

Thai Company Rules tightened

PHUSADEE ARUNMAS

New business registration rules (read up: translation 2006 business registration) will require all new companies with foreign shareholdings of more than 40% to declare their sources of funds, according to the Commerce Ministry. The new policy, which will take effect on Aug 15, is aimed at guarding against the problems of nominee shareholders and increasing transparency in the corporate registration process.

Thailand Tourism License

To operate a tourism business, a Tourism License must be obtained. The governing law in this regard is the Tourism Business and Guide Act B.E.2535 (1992). According to the Act, there are numerous requirements which must be satisfied and documents which must be submitted before a License will be issued. It should be noted that the documents preparation and application process may take up to three months.