Partners are very important in business, particularly if you’re looking to invest in the economy of countries like Thailand in Southeast Asia.
It’s also dictated by law that you must have a partner if you’re a foreign investor, because 100% foreign-owned companies are illegal in the Kingdom. Thus, there is no room for single proprietorship in Thailand, unless you’re looking to invest only in condominium units, which is totally legal thanks to the Thai Condominium Act.
Your partners will act as shareholders in any business that you plan to put up in the Kingdom, as laws dictate that there should be at least 40% or at most 60% local Thai membership in the company’s board of directors. By the way, be careful and be vary of nominee shareholders — they are illegal in the Kingdom.
Because of several legal hurdles that are to be expected when making an investment in the Thai economy, there is one business partner that you shouldn’t be without in the Kingdom. This partner is the lawyer or legal advisor.
It would be to your advantage to take the mindset that a legal advisor is an indispensable part of your team. While he or she may not be a member of your board of directors, the legal advisor could help take your business off the ground through his or her expertise of the law in Thailand.
Legal advisors have the unique positioning through which they can help you negotiate a fair business deal with local suppliers. They know which deal is legal, and which one are unfair or beneficial only to the local partner.
He or she can help you avoid misinterpretations of the law especially in entering into lease agreements, signing employment agreements with local and foreign workers, and the legal requirements you’ll have to comply with when starting a business in Thailand.
Legal advisors have the knowledge with which to guide you into legally bringing in your foreign workers into the country under a work visa. If you don’t have a legal advisor on your side, you might fall prey to suggestions of having your employees abuse the tourist visa — an act which is punishable by deportation and a hefty fine under the new immigration rules implemented by the Kingdom’s government this year.
With a legal advisor on your side, someone else does the thinking for you when it comes to legalities and stuff. You could focus your energies on coming up with creative ways to make money for your business, with the advisor pitching in only to advise you on whether or not your plans constitute violations of both local and international law.
Now that you understand how beneficial it is to tap the services of a lawyer or legal advisor, go ahead and find one to work with. Give us a call now and we’ll be happy to answer your inquiries.
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