Thailand's Department of Business Development (DBD), under the Ministry of Commerce, is considering to remove four business activities from the list of restricted activities under the Foreign Business Act B.E. 2542 (1999) (FBA). The four business activities are:
- Telecommunications services provided under Telecommunications Licence Type I (operators that do not own a telecommunications network)
- Treasury Center
- Aircraft reparation and maintenance services provided by operators with Repair Station Type 2 certification (for maintenance of material component of aircrafts) and Repair Station Type 3 certification (for maintenance of parts of aircrafts under the air navigation law).
- Provision of services for software development with high value added.
DBD is considering removing the four business activities from the restricted list because these activities are already subjected to the supervision of their respective legislations. Telecommunications services are subject to Telecommunications Business Act,. B.E. 2544 and are required to obtain licences from The Office of The National Broadcasting and Telecommunications Commission. Treasury center is currently subject to Exchange Control Act. B.E. 2485 under the supervision of the Bank of Thailand and is required to obtain approval from the Ministry of Finance and comply with the regulations of the Bank of Thailand. Aircraft maintenance services are subject to Air Navigation Act B.E. 2497 and under the supervision of The Civil Aviation Authority of Thailand. Removing these activities from the list will reduce the duplication of administrative work of the government authorities, save costs and time, and reduce complications for foreign investors in securing licences and approval from the relevant government authorities to boost foreign specialists to invest in Thailand.
Currently, the Foreign Business Operation Act B.E. 2542 (1999) (FBA) is the main legislation governing and concerning all foreign business operation activities in Thailand. The FBA categorizes the business activities which are restricted to foreigners and reserved for Thai nationals into three Lists. The business activities under List One are strictly prohibited to foreigners, whilst those under Lists Two and Three may be permitted to be engaged by foreigners if they obtain a licence and approval from the relevant authorities.
Currently, the said four business activities are under List Three of the FBA. Therefore, in addition to obtaining permits and approvals from the relevant authorities as per the requirement under the respective specific legislation as mentioned above, foreign investors must also obtain a foreign business licence from the DBD under the FBA. Once the four business activities are removed from List Three of the FBA, foreign investors will no longer need to obtain a foreign business licence under the FBA.
This relaxation proposal is still under consideration by a subcommittee under DBD, following which it will be proposed to a committee, also under DBD, and then for approval by the Cabinet. We will closely monitor and provide an update on any development on this proposal.