Setting up a Representative Office is one of the fastest and easiest ways for a foreign corporation to establish itself on the Thai market. Our company registration experts will assist you in preparing the required documents and guide you through the legal process.
The Representative Office operates service business on behalf of its Head office or an affiliated company, but cannot generate revenue or earn income. It can only report on movements in the Thai market and facilitate trade.
Foreign companies that are not able to meet the requirements for a foreign business license in Thailand but still want to do marketing or ensure quality control on products sourced from the country can establish a representative office. The office can conduct non-revenue earning activities but must report to the head office on movements of goods.
The office also must remit a specific amount of money back to the head office each year. In addition, the manager of the office must prepare an annual report on activities for the head office.
In comparison to a foreign business branch, the process for setting up a rep office is significantly shorter. Furthermore, the office is not required to follow the work permit ratio of four Thai employees for every foreign employee. The offices are also not subject to corporate income tax because they do not earn revenue. However, they must pay interest on remittances from the head office.
In the case of foreign companies that wish to explore the Thai market, but are not yet ready to make a business investment and risk their capital, the establishment of a representative office in Thailand can be a good solution. This type of entity does not require a Foreign Business License (FBL), and allows for the conducting of legally permitted activities without the requirement to earn income in Thailand.
Representative offices manage service businesses in Thailand on behalf of the head office or affiliated companies in other countries. The representative office cannot perform revenue-generating activities, accept purchasing orders or make offers for selling, nor negotiate with any juristic person established in Thailand. It is also not subject to corporate income tax, except for deposit interest from remitted funds from the head office.
The set up process for a Representative Office in Thailand is relatively fast and easy, and typically takes about a week. Tila legal can assist with preparing the required documents, which must be notarized and certified by the local Thai Embassy or Consulate, and should not be more than six months old at the time of submission.
Foreign companies that want to explore the market or conduct marketing can use a Representative Office. This type of office is not required to pay any taxes, assuming it does not engage in income generating activities.
This office can report on business movements in the country and source goods for the head office. It cannot, however, make sales or engage in any type of business negotiations with third parties.
The Representative Office must deposit a minimum amount of capital into Thailand to operate, which can be used for operating expenses. There is also a government fee and annual report.
Tila legal can help you prepare the necessary documents for the Representative Office, including a letter of appointment signed by the director of the foreign entity and a local manager. We will then verify that all the documents are correct before they are submitted. This process can take as little as a week. We can even arrange for a lawyer to handle the process for you.
A representative office in Thailand allows a foreign company to report on business movements in the country to its head office. It can also perform inspections and quality control of goods that the headquarters has sourced from Thailand. This is an attractive option for companies that want to enter the Thai market without investing in a full-blown local business.
In order to register a rep office, the foreign head office must submit a Letter of Appointment. A certified photocopy of the passport of the manager must be included, along with his or her personal ID and household registration. In addition, the manager must sign a declaration that he or she satisfies all qualifications and does not have a prohibited characteristic according to Section 16 of the Foreign Business Act. Once all documents are complete, the representative office can begin operating. It is not subject to corporate income tax, but it must deposit the interest on any funds remitted from its head office.