Integrity Legal

10th September 2009

The Bangkok Post is reporting that the World Bank has released a new report regarding the ease of doing business throughout the world. According to the report, Thailand achieved an overall rank of 12 when compared against other countries.

The Bangkok Post was quoted as saying:

“Thailand ranked relatively well in terms of property registration, trade, investor protection and ease in dealing with construction permits… Kirida Bhaopichitr, senior country economist for the World Bank in Bangkok, said Thailand benefited from improvements in the time and procedures needed to register a business and reduced bureaucracy in customs clearance.”

One of the major benefits to those doing business in the Kingdom of Thailand is the improved registration process for setting up a Thai company. At one time, the process of registering a Thai company was extremely time consuming and also required the seven shareholders.

Recently, the corporate laws have been changed to allow companies to have a minimum of three shareholders. If correctly executed, the company registration process can now be completed in as little as one day.

One slightly misleading aspect of this article concerns Thai property registration. Although it is true that Thai property can be registered relatively easily, the article does not go on to mention the fact that foreign nationals are virtually barred from owning land in the Kingdom of Thailand. In theory, it is possible for foreign nationals to own land in Thailand, but they must have the transaction signed off by the Minister of the Interior. Obtaining this signature is considered nearly impossible in some cases.

The Bangkok Post article also said, “Penelope Brook, acting vice-president for financial and private sector development at the World Bank, said Thailand could do more to improve areas such as transparency and investor protection.” There is some truth to this criticism as regulation of Thai investments is enforced less strenuously than in other countries. However, the Thai economy is often more transparent than many countries. That being said, one of the main reasons many people consider it non-transparent is due to the fact that the Thai method of doing business is very different from that of the West. Therefore, a result of these differences is that the economy is viewed as less transparent when the real issue is probably one of culture clash.

This article only dealt with the economic sphere and did not really deal with the political front. That being said, business and politics will always have an impact upon each other.

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2 Responses to “Thailand Gets High Marks in Business Friendliness”

  1. big skippy says:

    somewhat off topic, but your site has an entry on “Thai limited liability partnerships”. The description, however, is about “Thai limited partnerships” and provides good details of such partnerships. I don’t believe that Thailand has a form of “limited liability partnership” yet (as in the US for example), which is a much different entity from a “limited partnership”.

  2. admin says:

    In Thailand, Thai Limited Partnerships and Thai Limited Liability Partnerships are used interchangeably. However, they are different in their approach to the issue of limited liability when compared to their western counterparts. Only the Limited partners have limited liability while the general partner has unlimited liability. For the most part, it is better to utilize a limited company as Thai partnerships (limited or general) are more risky from a limited liability standpoint.

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