Asia Properties & Assets Consultancy has setup office in Bangkok, Thailand - MRA Grant

Asia Properties & Assets Consultancy Pte Ltd is one of the fastest-growing real estate and property asset management companies in Singapore. They offer property & asset management services such as Maintenance Management, Property & Assets Accounting and Financial Services, Property & Assets Administrative Services and Property & Assets Professional Consultancy Services.

Thailand Potential for Foreign Businesses

As part of Asia Properties' business expansion plan, Apstellar has identified Thailand as a potential market for Asia Properties to venture into. Based on Apstellar's research, a business consultancy firm specializing in business expansion in Thailand, Thailand has been generating interest for foreign companies to invest and set up businesses in Southeast Asia. With a sizeable population nearing 70 million and a strong GDP of 500 billion USD, there is high potential growth for foreign business entry into Thailand. The Thai government has launch fascial initiatives such as Eastern Economic Corridor (EEC) Development Plan to encourage foreign investment.

With government support of US$43 billion (Thai Baht 1.5 trillion) over the next five years, the EEC will drive four key economic areas in

1) establishing of infrastructure for business;

2) Development of business, industrial clusters, and innovation hubs;

3) Driving tourism and;

4) Creation of new cities through smart urban planning.

Through the EEC, the Thai government has forecast a creation of 100,000 new jobs in the manufacturing and service industry by 2020.

Challenges in Company setup and Managing of Business Operations in Thailand

However, due to factors such as language barrier and complexity of Thai law, foreign businesses may experience difficulties in the initial setup process and subsequent running of business operations. As such, it is important for foreign business to identify a right consultancy firm to develop their presence in Thailand, instead of sourcing vendors performing administrative task requests.

Potential in Thailand Real Estate and Property Management

Although the Thailand real estate market is rather slow in 2021 due to Covid 19, the stalled real estate market has forced developers to adapt quickly. For example, they have launched more landed property projects targeted at specific group of audience, such as the working class. This is because many of them were working from home during the pandemic and having a comfortable work environment appeals to their purchasing behaviors.

With restriction easing and countries adopting Covid 19 endemic mindset, the Thailand real estate market is expected to rebounce. Overall, price demands are expected to drop to generate overseas investors' interest. In fact, Thailand homebuilder Seacon Company Limited announced it expects a 28% increase in profits for 2022.

The property management trade is considered as a new business concept for home owners in Thailand. However, with more foreign investment coming into Thailand, there will be a rising demands for property management companies. The foreign landlords based overseas generally prefers that their assets and tenants are being managed by a local team of professionals.

Throughout the course of our consultancy services, the entire process was completed through digital means. Therefore, the client was not required to travel to Thailand physically. We are pleased to share that the project has been completed, and our client has started their business operations in Bangkok, Thailand since 2021. Apstellar is currently assisting Asia Properties in their running of business operations, which involves Recruitment, Business Matching, Contract Negotiation and Corp Tax matters.

We have also provided a FAQ section to address some of the queries pertaining to Setting up a foreign company in Thailand.

FAQ: Set up Business in Thailand for Foreigners

Qns: We wish to register a 100% foreign owned business in Thailand. is this possible?

Ans: Foreign businesses are able to setup 100% foreign owned business in Thailand through Board of Investment BOI or Foreign Business License FBL. Typically, we will analyze our client's business structure and activities. It is important to note that BOI applications are limited to specific business activities while for the case of FBL applications, the application process is often time-consuming and the outcome may be unpredictable.

Qns: Is there any way to mitigate risks for a Thai Company Structure?

Ans: Yes. We can draft legal shareholders agreement to organize the relations and define the rules of the with your shareholder. The document can be used to allow its signatories to manage the exit strategy of each shareholder, which gives its beneficiaries the right to acquire in priority the shares of a shareholder who wishes to sell, and provides for a mandatory prior authorization of the shareholders before any transfer of shares.

Qns: Our business activity may be not suitable for BOI application. We are considering to apply for FBL instead. What do you suggest?

Ans: Generally, except for large multinational corporations MNCs, we would advise our clients to consider setting up a Thai Company Structure instead. We can also source for the suitable Thai investor or business partner and facilitate a successful business venture.

Qns: The quotation fees that we have received to set up business in Thailand varies by a large range. Why is that so?

Ans: Every vendor has their area of expertise and price range. In Apstellar, we focus on the long term sustainability of our clients' businesses in Thailand. Apart from company setup and registration, we offers corporate legal services, recruitment, property purchases, business matching and subsequent contract negotiations.

Qns: do we need to apply for work permit as a foreign representative?

Ans: A work permit is only required when the foreign representative or director is required to 1) work physically in Thailand or 2) sign off formal documents. Foreign representatives may also have difficulties in opening personal bank accounts in Thailand if they do not possess a work permit.

It is also important to note a company can only apply for work permit when they have minimum 4 Thai employees.

Depending on the business model of our clients, we will advise different approaches to achieve the desired objectives.

Article Published by Ray Oh, Apstellar Pte Ltd.