Having a Representative Office in Thailand is one of the easiest ways to establish a local presence for foreign companies in the country. The main advantage of having a Representative Office is that you will be able to establish a presence in the country without the need for a Foreign Business License. However, there are some basic requirements that you should know before establishing a Representative Office in Thailand.
The first step to establishing a Representative Office in Thailand is to make an application to the Department of Business Development of the Ministry of Commerce. Once the Department of Business Development receives your documents, they will issue you a certificate/registration number. Once this is complete, you can begin the process of setting up your Representative Office in Thailand.
You must invest at least three million Thai baht in your Representative Office. This amount must be paid within six months of obtaining a registration number. If you are unable to provide the required amount within this time, you will not be able to receive a registration number. The remainder of the registered capital must be paid within three years of operation. You will also be required to submit an audited financial statement to the Revenue Department.
You must have a manager who will oversee day-to-day activities of your Representative Office. He or she must submit evidence of qualification, proficiency, and experience. You must also have a power of attorney, which must be certified by the Thai embassy. This power of attorney must contain a copy of your passport. The documents for setting up your Representative Office must be notarized and dated within the last six months.
Once you have all your documents approved by the Department of Business Development, you must then appoint a local manager for your Representative Office. You can either choose to hire someone who is a Thai national or a representative of a foreign company. The representative office can have as many employees as it needs, but you must hire four Thai employees for every foreign employee. If you hire foreign employees with fewer requirements, the number of employees may be lowered.
Having a Representative Office in Thailand is a great way to test the Thai market before launching your products in the country. It allows you to study business information in Thailand and promote your products. You will also receive a subsidy to help cover the expenses you incur in Thailand. However, you must make sure that the quality of goods you purchase from Thailand are up to standard.
Representative Offices are considered service businesses under List Three (21) of the Foreign Business Act. They can earn income by billing clients, but they are not allowed to generate income through trading activities or negotiating business deals with third parties. However, they can receive funds to cover the costs of running the office.
Representative Offices must report information about new products and goods, and the business trends in Thailand. They must also report on the demand for services and goods in different industries. The representative office must also provide advice to its agents regarding the goods it sells.