With a projected annual growth rate of 4.5% from 2024 to 2028 and favorable policies for foreign investments, the construction industry in Thailand offers significant opportunities for foreign investors looking to expand their business.
In this article, we’ll explore the essentials of establishing a construction company in Thailand, including key requirements and mandatory licenses and permits.
Mandatory Requirements for Establishing A Construction Company in Thailand
Before you set up a construction company in Thailand, the first step is to choose an appropriate legal entity. Depending on local or foreign ownership and planned projects, the most popular legal entities for construction companies include a Private Limited Company (LLC), a Foreign Business License (FBL) Company, and a BOI-Promoted Company.
Emerhub’s local experts will help you choose the most appropriate legal entity based on your planned activities.
After choosing an appropriate business structure, the following documents must be prepared for registration of your construction business in Thailand:
- Company Registration Form
- Memorandum of Association (MOA)
- Articles of Association (AOA)
- List of Shareholders
- Biography of Directors
- Notice of Appointment of Director
- Certificate of Registered Address
Licensing and Permit Requirements for Construction Companies in Thailand
To be fully operational, you must obtain the proper licensing and permits for your construction business beforehand. Emerhub’s local consultants can assist you by liaising with the local governing bodies on your behalf and compiling the necessary documents. These licenses and permits include:
- Foreign Business License (FBL): Mandatory for foreign investors operating a construction business in Thailand, as construction is classified under the Foreign Business Act’s restricted activities.
- Construction Permit (AOR. 1): Mandatory requirement for constructing buildings, application takes 1.5 to 4.5 months.
- Notification of Construction Supervisor (Nor. 4): After obtaining the Construction Permit, the licensee must notify the local competent official of the construction supervisor’s name and the timeframe for starting and completing the construction. A written consent from the construction supervisor is also required.
- Environmental Impact Assessment (EIA) Report: For projects specified by the Ministry of Natural Resources and Environment. The evaluation process takes 4 to 6 months.
- Factory License (Ror.Ngor.4): For construction projects involving factory operations. Obtainable from the Department of Industrial Works, Ministry of Industry taking around 4 to 6 months.
- Building Certification (AOR. 6): After construction completion, the project owner must notify the authorities to inspect the building and obtain the Building Certification.
Ensuring Post-Registration Compliance for Your Construction Business
There are certain legal requirements and local laws that should be taken into account when establishing your construction company in Thailand. Failure to comply with these requirements may result in heavy penalties and suspension of your business operations:
- Income Tax Registration: Registering with the Revenue Department of the Ministry of Finance for your tax number.
- VAT Registration: Applying the Area Revenue Offices in your region to get a VAT Registration Certificate for your business.
- Corporate Bank Account: Opening a corporate bank account for all your business dealings.
- Social Security Fund Registration: Registering at the Social Security Office within 30 days of hiring your first employee. This is mandatory for both employers and employees.
- Work Permits and Visa Requirements: Foreign workers must obtain work permits and work visas upon arrival in the country. A good option would be the Highly-Skilled Professional LTR Visa.
- Professional Licensing for Contractors: Companies engaged in engineering and architectural services must employ Thai-licensed engineers or architects on their board of directors.
Emerhub’s local experts provide an extensive company registration service to help set up your construction business in Thailand. We’ll ensure your company complies with local tax laws and regulations by handling employee payroll, income tax filings, and social fund registrations on your behalf.
Furthermore, we’ll assist with securing the essential construction licenses, work permits, and business licenses for the smooth operation of your business. Contact us by filling out the form below.
