The Amity Treaty is a bilateral agreement between the United States of America and Thailand concerning economic relations. This treaty allows for a special economic relationship between the United States of America and the Kingdom of Thailand and gives special rights and benefits to American citizens and corporations, specifically the Treaty of Amity allows Americans to open a company in Thailand and own 100% of the shares of the company. There are some limitation and restrictions in what activities a company that is registered under the treaty cannot perform.

Limitations Of An Amity Treaty Company

Despite the benefits provided by the Treaty of Amity, additional limitations apply on U.S. investments in Thailand as follows:

  • Land ownership;
  • Ativities in the internal transport and communication sectors;
  • Engaging in fiduciary functions;
  • Engaging in banking activities with depositary functions;
  • Engaging in domestic trade of domestic agricultural products;
  • Exploiting land with natural resources,

Despite the privileges granted by the Treaty of Amity, some U.S. companies still form joint ventures with Thai parties and allow them to have a majority stake because of their understanding of the local economy, business cultures, and Thai rules.

The Application Process

In order for an Amity Treaty Company to benefit from the advantages granted by the treaty, it is essential to obtain the licenses and authorizations before creating the Thai company. The process can be lengthy as many administrative documents need to be provided to the Business Development Department and the U.S. Embassy in Thailand.

  1. Analyze the eligibility of your activity
    Before applying for a Treaty of Amity license, it is important to ensure that your business activities are eligible for the Amity Treaty license. Thai law strictly regulates certain economic activities in Thailand that are reserved for Thai nationals only.
  2. Submission of documents to the U.S. Embassy Commercial Services Department
    Original documents must be submitted to the U.S. Embassy, Commercial Services Department located in Bangkok at the GPF Witthayu Commercial Service Office, Tower A, 3rd Floor, Room 302, Wireless Road. The U.S. Commercial Service Department must issue a certificate proving that the applicant, either a U.S. company or an American citizen, meets all qualifications for the Treaty of Amity. The U.S. Commercial Services Office will then confirm to the Thai Commercial Registration Department of the Ministry of Commerce that the applicant is an American-owned and operating company or a U.S. citizen and is therefore eligible for the treaty's provisions.
  3. Submission of required documents to the Ministry of Commerce
    After obtaining the documents certified by the trade services, the applicant must submit the mentioned documents to the Ministry of Commerce at the Business Development Department (DBD) to register the treaty and complete the procedure.
  4. Incorporation of a Thai Company
    After obtaining the Certificate the applicant(s) must follow a specific procedure to register a Thai Limited Company under the Treaty of Amity. The company should be registered with a minimum paid up capital of 2 million Thai Baht and it must meet the following criteria:
    • U.S. citizens or Company will own at least 51% of the shares;
    • At least half of the members of the board of directors must be U.S. citizens;
    Once the Thai Limited Company has been set up, the applicant (business entity) must submit all the documents, along with the completed application form, to the Foreign Enterprise Administration, Business Development Department.

Summary - Setting Up An Amity Treaty Company

If all the documents are submitted correctly, and after the applicant pays the required fee the applicant will receive the U.S. Treaty of Amity Certificate. Now the company is free to begin operations.

As you can see setting up an Amity Treaty Company in Thailand is a little difficult and a lengthy process. It is a great solution for an American individual or American company looking to expand into Thailand and have full control of its business. There are other corporate structures in which foreigners can subscribe to that will enable them to start doing business immediately and may prove to be more advantageous.

For more information on setting up an Amity Treaty company or any other corporate setups or to consult with a corporate professional at PCS for FREE please don't hesitate to fill in the form below and Contact Us!

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