Starting a business in Thailand often involves setting up a private limited company, and at the heart of this process are the promoters. Promoters are essential to getting the company off the ground. Let’s break down who they are, what they do, and what the recent changes to Thai law mean for business owners.
Who Exactly Are the Promoters?
In simple terms, promoters are the people who come together to form the company. They are not companies or corporations but must be individuals. These people must be at least 12 years old to qualify, and they need to be available to sign off on the required documents during the company’s registration. If the registration is done online, each promoter will go through the Know Your Customer (KYC) verification system, which is designed to confirm their identity. It’s a key part of making sure the process is legitimate and secure.
While promoters don’t need to live in Thailand, they must provide a Thai address to complete the registration. This gives some flexibility for foreign investors looking to establish their company in Thailand but ensures there’s a local touchpoint.
What Are Their Main Responsibilities?
Promoters play a big role at the start of the company’s life. They’re the ones responsible for getting all the paperwork ready and submitted to the Department of Business Development (DBD). This includes documents like the Memorandum of Association (MOA), which lays out the company’s details and purpose.
In addition to this, each promoter must hold at least one share in the company. Once the registration is complete, promoters can choose to transfer their shares to other people if they wish, but during the registration, they need to be initial shareholders.
Promoters are also responsible for covering the costs of the registration process. These can range from administrative fees to any legal services they might need. Once the company is up and running, it can reimburse the promoters for these initial costs.
Are There Any Risks for Promoters?
As far as liability goes, promoters’ responsibilities are usually limited to the par value of the shares they hold. This means they’re only financially responsible for the value of their shares, keeping their risk fairly low. However, they’re also responsible for ensuring everything goes smoothly during the registration process and that all the legal requirements are met.
How Recent Changes in Thai Law Help Business Owners
One of the biggest updates in Thailand’s business regulations is the change that allows just two promoters to register a private limited company. This update, introduced in 2022, makes the registration process easier and more accessible, especially for smaller groups of founders or those just starting out. It’s a big step toward encouraging both local and foreign investment.
How Sukhothai Interlaw Can Help You
At Sukhothai Interlaw, we’ve been helping businesses get off the ground for more than 30 years. Whether you’re navigating complex contracts or just trying to get through the company registration process, our team is here to help. With our deep experience in contracts, negotiations, payments, and escrows, we’ll make sure your company is set up for success.
If you’re thinking about registering a business in Thailand, let us guide you through the steps, ensuring every aspect is handled with care and professionalism.
