Providing consulting services, preparing documents and requesting BOI investment promotion
Skyinterlegal provides consulting services, applications for investment promotion cards, applications for Incentives under investment promotion cards, and submission of reports on compliance with various conditions of investment promotion cards.
BOI (The Office of the Board of Investment)
The BOI is a government agency under the Office of the Prime Minister. Its main roles and responsibilities are to promote direct investment. The BOI prescribes the investment promotion policies under Investment Promotion Act No.2 B.E. 2534, No. 3 B.E. 2544, and No. 4 B.E. 2560.
The BOI has responsibilities in promoting investment in businesses that are beneficial to the country by granting investment rights and benefits, creating supportive environment for investment, and promoting and servicing investment in order to strengthen the overall national economic and social systems. The duties and authorities of the BOI are:
- To operatein accordance with the laws on investment promotion, the laws on competitiveness enhancement of the country in targeted industries, and other relevant laws;
- To operate in accordance with the resolutions of the Board of Investment or the Commission on the National Competitiveness Enhancement for Targeted Industries Policies, or as assigned by such entities;
- To publicize investment atmosphere and attract investment in essential businesses which create immense value to national economy, society and security;
- To establish investment service centers for anticipating investors or investors to apply for permission and investment-related services, as well as to facilitate and assist those anticipating investors in preparing and operating their projects;
- To analyze the projects applied for promotion, inspect and control, and evaluate the investment of the promoted projects;
- To study and survey for investment, produce investment feasibility report, plan and promote investment, and assist in solving problems for investors;
- To study, collect and provide information, and promote investment both in the country and overseas, as well as to seek for co-investors or experts in the fields necessary for national development, and to create connectivity and enhance investment opportunities for Thai investors;
- To evaluate investment promotion and performance of the National Competitiveness Enhancement for Targeted Industries Fund, as well as to evaluate the worthiness of the incentives given to promoted investors;
- To operate other tasks as stipulated by the laws to be the duties and authorities of the Office, or as assigned by the Prime Minister or the Cabinet.
Five-Year Investment Promotion Strategy Vision (B.E.2566-2570)
“ Promotion of Investment to restructure Thailand’s economy into new economy” with the main objectives of restructuring Thailand’s economy to achieve 3 aspects consisting of:
1. Innovative: Being an economy that is driven by technology, innovation and creativity.
2. Competitive: Being an economy that is competitive, adaptive and generate high growth.
3. Inclusive: Being an economy that values environmental and social sustainability, creates opportunity and reduces inequality.
Guarantees and protections that investment promoters will receive from the State under the Investment Promotion Act B.E. 2520 (1977), as amended in 2017.
State protection
Section 43 The State shall not nationalize the activity of the promoted person.
Section 44 The State shall not undertake a new activity in competition with the promoted person.
Section 45 The State shall not monopolize the sale of products or commodities of the same kind as, or similar to those produced or assembled by the promoted person.
Section 46 The State shall not impose the price control on the products or commodities of the promoted activity except when it is necessary for the economic and social development and for the security of the country but in no case shall the controlled prices be lower than those which the Board deems appropriate.
Section 47 The promoted person shall be granted permission to export products or commodities of the promoted activity at all times except when it is necessary for the economic and social development and for the security of the country.
Section 48 The State shall not allow any government agency, government organisation or state enterprise to import into the Kingdom, with import duties exempted any kind as those being produced or assembled by the promoted person, which are comparable in quality therewith and are available in sufficient quantity to be acquire for its use.
The provision of paragraph one shall not apply to munitions under the law on control of military munitions for use in the service of the Ministry of Defence.
Special fee collection
Section 49 In the case where it is necessary to protect the activity of the promoted person the Board shall have the power to impose special fees for the import into the Kingdom of products or commodities of the same kind as, similar to, or substitutable with those produced or assembled by the promoted person at the rates the Board considers appropriate but not exceeding fifty percent of the prices of such imported products or commodities, inclusive of overseas insurance and freight charges.
The imposition of special fees under paragraph one shall be announced in the Government Gazette and shall be effective each period not more than one year from the day following the date its publication in the Government Gazette.
The Board shall have the power to make by publishing in the Government Gazette an amending or cancellation of the announcement made under this section at any time it deems appropriate.
In the case where there is a question whether or not the product or commodities imported into the Kingdom are subject to the special fees in accordance with the announcement of the Board, the Board shall have the power to decide it and the decision of the Board shall be final.
The collection of special fees for the import under this section shall be the power and duty of the Customs Department and law on customs shall apply mutatis mutandis as if the special fees for the import were the import duties under the law on customs tariff.
In the case where the Board decides that such products or commodities are not subject to the special fees and person has paid the special fees therefore, the Department of Customs shall refund the fees to such person.
Section 50 In the case where the Board is of the opinion that the imposition of special fees under section 49 is inadequate for the protection of the activity of the promoted person, the Ministry of Commerce shall ban the import into the Kingdom of products or commodities of the same kind as, similar to, or substitutable with those produced or assembled by the promoted person in accordance with the law on the control of export and import into the Kingdom of certain goods.
Assistance for Investors
Section 51 In the case where the promoted person encounters any problem or obstacle in the course of carrying out the promoted activity and lodges his complaints to secure the assistance of the Board, the Chairman shall have the power to render any appropriate assistance or to order the related government agencies, government organisations, or state enterprises to proceed with the assistance without delay.
Section 52 In the case where the structure, rates, or procedure for the collection, of taxes and duties, service charges or fees are found to be an obstacle to the promotable or promoted investments, irrespective of whether a complaint has been lodged with the Board, the Chairman shall have the power to order the related government agencies, government organisations, or state enterprises to take remedial action.
Section 53 Any government agency, government organisation or state enterprise to which the order of the Chairman has been issued under section 51 or section 52 shall render assistance or take remedial action in accordance with the aforesaid order. If the order cannot be implemented, it shall report to the Chairman with reasons within fifteen days from the date the order was received.
Upon having received the report of reasons under paragraph one, the Chairman may take any appropriate action which shall be final and the government agency, government organisation or state enterprise concerned shall comply therewith without delay.
Investment Promotion Criteria
1.In order to develop competitiveness in the agricultural, industrial and service sectors, projects submitted for BOI promotion must have the following qualifications:
1.1 The value-added of the project must not be less than 20% of revenues, except for projects in agriculture and agricultural products, electronic products and parts, and coil centers, all of which must have value-added of at least 10% of revenues.
1.2 Modern production processes or servicing procedure must be used and in accordance with the Board’s approval.
1.3 New machinery must be used. If old machinery from abroad is used, it must comply with the conditions set by the BOI.
2.Projects involving metal melting processes must be certified to ISO 14000 quality system standards or an equivalent standard before exercising corporate income tax exemption incentives. If the projects do not exercise or have not been granted the income tax exemption incentives, they must obtain the required certification before the full operation deadline.
3.Environmental protection
3.1 Adequate and efficient guidelines and measures to protect environmental quality and to reduce environmental impact must be installed. The Board will give special consideration to the location and pollution treatment of a project with potential environmental impact.
3.2 Projects or activities with type and size that are required to submit environmental impact assessment reports must comply with the related environmental laws and regulations or Cabinet resolutions.
3.3 Projects located in Rayong must comply with the Office of the Board of Investment Announcement No.Por 1/2554 dated May 2, 2011 on Industrial Promotion Policy in Rayong Area.
4.Minimum capital investment and project feasibility
4.1 The minimum capital investment requirement of each project is 1 million baht (excluding cost of land and working capital) unless specified otherwise on the list of activities eligible for investment promotion that is announced by the Board. As for knowledge-based activities, the minimum capital investment requirement is based on the minimum annual salaries expense specified in the list of activities eligible for investment promotion that is announced by the Board.
4.2 For newly established projects, the debt-to-equity ratio must not exceed 3 to 1. Expansion projects shall be considered on a case-by case basis.
4.3 For projects with investment value of over 2,000 million baht (excluding cost of land and working capital), the project’s feasibility study must be submitted with details as specified by the Board.
Criteria for Foreign Shareholding
The Board stipulates the following criteria for foreign shareholding in projects that apply for investment promotion:
- For projects in activities under List One annexed to the Foreign Business Act, B.E. 2542, Thai nationals must hold shares totaling not less than 51% of the registered capital.
- For projects in activities under List Two and List Three annexed to the Foreign Business Act, B.E. 2542, there are no equity restrictions for foreign investors except as otherwise specified in other laws.
- The Board may set foreign shareholding limits for certain activities eligible for investment promotion as deemed appropriate.
Incentives under the Investment Promotion Act
In order to obtain investment promotion, the BOI applicant must follow the conditions prescribed by the Board of Investment as specified in the BOI promotion certificate in which the following incentives will be granted:
Tax Incentives
- Exemption/reduction of import duties on machinery (Section 28/29)
- Reduction of import duties for raw or essential materials (Section 30)
- Exemption of import duties on materials imported for R&D purposes (Section 30/1)
- Exemption of corporate income tax on the net profit and dividends derived from the promoted activity (Section 31, 31/1 and 34)
- A 50 percent reduction of the corporate income tax (Section 35(1))
- Double deduction from the costs of transportation, electricity and water supply (Section 35 (2))
- Additional 25 percent deduction of the cost of installation or construction of facilities (Section 35(3))
- Exemption of import duty on raw or essential materials imported for use in production for export (Section 36)
Non-tax Incentives
- Permit for foreign nationals to enter the Kingdom for the purpose of studying investment opportunities. (Section 24)
- Permit to bring into the Kingdom skilled workers and experts to work in investment promoted activities (Section 25 and 26)
- Permit to own land (Section 27)
- Permit to take out or remit money abroad in foreign currency
(Section 37)
Additional Incentives
- Competitiveness Enhancing Incentive
1.1 Additional Corporate income tax Exemption Limit 200% Investments/Expenditures.
1.2 Extension of CIT Exemption to a Maximum Period of 13 years.
- Measure to Support Establishment of Institutes for Highly Skilled Professional Development
2.1 Existing Projects: Corporate income tax exemption for a period of five years, with a cap of 100 percent of the capital investment in new projects (excluding the cost of land and working capital) for the establishment of educational or training institutes and other non-tax incentives for the establishment of educational or training institutes.
2.2 New Projects: Exemption from import duty on machinery and other non-tax incentives.
- Additional Incentives for Area-based Promotion
3.1 BOI-promoted industrial estates or zones: Projects located within promoted industrial estates or industrial zones (see map on page 22) shall be granted one additional year of corporate income tax exemption.
3.2 20 Areas with low per capital incomes: Projects located in 20 Areas with low per capital incomes shall receive Three additional years of corporate income tax exemption shall be granted. Projects with activities in Group A1 or A2 shall instead receive a 50% reduction of corporate income tax on net profit derived from promoted activity for 5 years after the corporate income tax exemption period expires.
3.3 Science and Technology Zone
3.3.1 Target Core Technology Development Activities: CIT Exemption 2 years in addition to the basic incentives.
3.3.2 Other Target Activities: Corporate income tax reduction 50%, 5 years span in addition to the basic incentives
Note: Eligibility for the above incentives depends on the type of business and conditions of the promoted project.
Group of Industries and General List of Activities Eligible
for Investment Promotion
BCG Industries
Agricultural and Food Industries
- Upstream agriculture; Economic forest plantation and Energy crops plantation, Animal propagation or animal husbandry, Deep sea fishery
- Processed agricultural products; Starch made from plants, Oil or fat from plants or animals, Tanneries or leather finishing, Natural rubber products, Preservation of food, beverages, food additives, food ingredients or dietary supplement products, Future food, Animal feed or animal food ingredients fuel or pharmaceutical grade alcohol from agricultural products, including agricultural scrap or waste, Natural extracts or products from natural extracts
- Modern agriculture; Plant or animal breeding, Manufacture or service of machinery and equipment of modern agricultural and modern agricultural system, Plant Factory
- Supporting agricultural industry; Fertilizers, Crop drying and silo facilities, Grading and storage of agricultural products, Cold storage, or cold storage and cold storage transportation, Trading center for agricultural goods
Biotechnology Industry
- Manufacture of biotechnology-derived products; Bioplastic, Biochemicals, Biotechnology
- Biotechnology development
Medical Industry
- Manufacture of medical products; Non-woven fabric or hygienic products from non-woven fabric, Medical devices, Active pharmaceutical ingredients, Medicines
2.2 Medical and health care services; Specialty medical center; Health care services
2.3 Clinical Research
(Read more…)
Machine and Automation System Industries
- Manufacture of machinery, equipment and parts, and repair of in-house fabricated machinery or equipment
- Manufacture of scientific equipment
- Manufacture of lenses that are not classified as medical devices
Automotive Industry
- Manufacture of engines, equipment, or parts
- Manufacture of vehicle parts
- Manufacture of general automobile
- Manufacture of motorcycles (except less than 248 cc engine displacement)
- Manufacture of battery electric vehicles (BEV), Plug-In hybrid electric vehicles (PHEV), hybrid electric vehicles (HEV), and BEV platforms
- Manufacture of electric battery motorcycles
- Manufacture of battery electric tricycles and battery electric tricycle platforms
- Manufacture of battery electric buses and trucks and battery electric buses and truck platforms
- Manufacture of electric bicycles (E-BIKE)
- Manufacture of fuel cell electric vehicles (FCEV) and equipment for
fuel cell system - Manufacture of fuel cells or parts
- Building or repair of ships
- Manufacture and/or repair of rolling stocks, parts, or equipment for rail system
- Charging station and battery swapping station for electric vehicles
Space and aerospace Industry
- Space and aerospace industry
Defense Industry
- Manufacture and/or repair of vehicles and weapon systems for national defense
- Manufacture and/or repair of unmanned systems for national defense and parts used in the manufacture and/or repair
- Manufacture and/or repair of weapons and exercise-facilitating equipment for national defense and part
- Manufacture and/or repair of combat facilitating equipment
Electrical Appliances
and Electronics industry
- Electronic design i.e. microelectronics, optoelectronics or embedded system
- Manufacture of electronic products, devices and parts
- Manufacture of electrical appliances, devices and parts
(Read more…)
Basis and Supporting Industries
Mineral Industry
- Prospecting of minerals, mining, mineral dressing, mineral smelting, metallurgy operations of targeted potential minerals
Materials Industry
- Manufacture of materials
- Targeted core technology development for materials industry
Steels and Irons Industries
- Manufacture of steels and irons
Chemical Petrochemical and Plastic Industries
- Manufacturing of chemical
- Manufacturing of chemical products for industry
- Manufacture of petrochemical products
- Manufacture of plastic products
- Manufacture of products from pulp or paper
Public Utilities and Environment
- Public utilities and basic services
Real estate development for industrial use
- Real estate development for industrial use
Service centers for managing electric vehicle batteries
- Service centers for managing electric vehicle batteries and/or energy storage systems
(Read more…)
Digital, Creative Industries and High Value Service
Low-income housing projects
- Low-income housing projects
Digital Industry
- Digital technology
- Digital Infrastructure
- Digital ecosystem supported business
Smart City Development
- Smart City Development
Light Industries
- Creative product design and development
- Manufacture of technical fiber or functional fiber
- Manufacture of functional yarn or functional fabric
- Manufacture of recycled fiber
- Manufacture of other fiber or yarn or fabric
- Bleaching, dyeing and finishing, or printing and finishing, or printing
- Manufacture of garments and household textiles
- Manufacture of bags or shoes or products made of leather or artificial leathers
- Manufacture of gems and jewelry or parts including raw materials and prototype
- Manufacture of sports equipment or parts
- Manufacture of musical instrument
- Manufacture of furniture or parts
- Manufacture of toys
- Manufacture of printed matter
Film Industry
- Thai motion picture production
- Motion picture support services
- Industrial zone for motion picture production
(Movie Town)
Professional services
- Professional services
- Research and Development
- Engineering Design
- Scientific laboratories
- Calibration services
- Product sterillization service
- Human resources development
Tourism Industry
- Tourism promotion services
- Activities to support tourism
Logistics Industry
- Mass transit systems, transportation of bulk goods and loading/unloading facilities
- Logistics service centers
(Read more…)
Applying for the BOI investment promotion with Sky International Legal
1. Reviewing Data
We will carefully review your business information to assess the possibility of BOI approval on your project. This step will allow us to comprehend your project and explain the details to the BOI officials correctly and completely.
2. Submission of Application for Investment Promotion
We will prepare the applications and comprise necessary details for the project, such as production or service procedures, lists of production cost, lists of machinery used, factory or office layouts, in-factory training plans. Then, we will submit an online application [via the e-Investment Promotion system].
3.Project Clarification
We will then make an appointment with the relevant BOI officer for your project. This is to provide a detailed explanation of the project, so that the officer can comprehensive better on the nature and details of your business.
4. Following up on the BOI’s Approval
It can take approximately 40-90 days from the date all documents are received for the BOI officials to analyze the project. The period of consideration will depend on your investment capital. Once the BOI has notify us the consideration result of your project, we will inform you as soon as possible. It is to note that if the BOI approve the project, we must accept the investment promotion resolution in writing within 1 month from the date we are notified of the consideration result.
5. Establish a Company
In the case of an individual applying for the investment promotion, a company is required to be established. This step must be completed expeditiously. As in order to apply for an investment promotion card from the BOI, we will need to submit all relevant documents, such as the application form for investment promotion certification from the BOI, the company registration certificate, the memorandum of association, the list of shareholders, the investment certificate from the bank or the receipt of money transfer from abroad, the technology transfer agreement, the joint venture contract, details of the business plan and machinery or software to be used throughout the project, the number of personnel you will hire from Thailand and abroad along with their salaries, the steps or strategies to be used to train Thai employees. When the BOI receives all the documents, it will issue an investment promotion card to you. As such, you must strictly comply with all the BOI’s requirements and conditions.
6. Applying for Visa and Work Permit
After the company has received the investment promotion card from BOI, the company must register in the e-expert system before hiring foreign employees. Once the foreign employees are approved by the e-expert system, they can apply for work permits and visas in Thailand.
7.Applying for incentives from the BOI
The company can apply for incentives from the BOI, such as tax privileges on machinery, raw materials, land, or foreign experts.
8. Reporting on Project Performance
The company must report on project and progress, project amendments, business transfers, and even project cessation or closure.
For more inquiries, please feel free to contact us:
Sky International Legal Co., Ltd.
725 S Metro Building, 20th Floor, Room 174, Sukhumvit Road, Khlong Tan Nuea Subdistrict, Vadhana District, Bangkok 10110.
See map (click here)
Tel. 081-9151522, 090-0700080
Email: skyinterlegal@gmail.com.