Thailand’s Foreign Business Act (FBA) imposes strict limitations on foreign participation in many industries, typically capping foreign shareholding at 49%, unless a company obtains a Foreign Business License or qualifies for a specific statutory exemption. In practice, these approvals can be time-consuming, discretionary, and subject to ongoing regulatory scrutiny.

By contrast, qualifying U.S. companies benefit from a powerful and unique exemption under the US–Thailand Treaty of Amity.

A Meaningful Legal Exception

Under the Treaty of Amity, eligible U.S. companies may legally hold up to 100% ownership in a wide range of business sectors that would otherwise be restricted under the FBA—without the need to apply for a Foreign Business License.

This exemption delivers clear and tangible advantages:

  • No requirement for majority Thai shareholders, preserving full economic ownership
  • No nominee shareholding risks, significantly reducing compliance and enforcement exposure
  • No special or discretionary government approvals, resulting in greater certainty and speed to market

Practical Business Advantages

In real-world operations, this translates into greater managerial control, clearer decision-making authority, and stronger protection of intellectual property and proprietary know-how. U.S. companies operating under the Treaty are also better positioned to implement international-standard corporate governance frameworks, which is often critical for regional headquarters, technology-driven businesses, and cross-border investment structures.

Why the Treaty of Amity Stands Apart

While Thailand is a party to other international agreements—such as the Thailand–Australia Free Trade Agreement and the Japan–Thailand Economic Partnership Agreement—those treaties are typically sector-specific, conditional, and far more limited in scope. Ownership rights under such agreements often depend on the nature of the business and remain subject to regulatory interpretation.

From a strategic investment perspective, the US–Thailand Treaty of Amity remains the most comprehensive and investor-friendly treaty available in Thailand, offering U.S. companies a level of legal access and certainty that no other foreign investors enjoy.

For U.S. investors seeking long-term stability, control, and compliance in Thailand, the Treaty of Amity is not merely an exemption—it is a decisive competitive advantage.

How H&P Can Assist

At Herrera & Partners (H&P), we take pride in providing comprehensive legal advisory services to foreign investors. If you are considering establishing a business in Thailand but are unsure which legal strategy best suits your objectives, our bilingual team ensures clear communication and a smooth, efficient process from start to finish. We offer practical, legally sound guidance tailored to your specific business needs.

We provide end-to-end support, combining in-depth legal expertise with a hands-on, solution-oriented approach. Our goal is to ensure that our clients maximize the benefits of their legal rights while maintaining full compliance with all applicable laws and regulations.

If you would like to learn more about doing business in Thailand or explore how our firm can assist you, please contact us at the details below:

📧 Email: info@herrera-partners.com
🏢 Office in Bangkok: Herrera and Partners Co., Ltd.
                                        142 Two Pacific Place, 17th Floor, Sukhumvit Road, Klongtoey, Bangkok
📞 Telephone: +66 2 254 5600