Nominee Director Service In Thailand

Nominee Director Service in Thailand

Tetra Consultants offers Nominee director service in Thailand for our international clients. Our full-service package includes Thailand company registration, nominee director services, provision of local company secretary and registered office address, free trade zone company set up, work permit application and corporate bank account opening.

Looking to set up in Thailand and expand your business into the Southeast Asian market? If so, you may have encountered the terms “Thailand nominee director”, “Thailand representative director” or “Thailand resident director”. Tetra Consultants advises you to read this webpage in detail in order to fully understand these terms and be able to make an informed decision for your Thailand company. 

What is a Thailand nominee director?

• A nominee director is a third-party individual who is appointed to be a director of a certain company and has the relevant qualifications and experience needed for the position. They are usually appointed to fulfil the compulsory residency or nationality requirements for directors in certain jurisdictions that require them. 

• As finding a suitable candidate to take up the position of nominee director in Thailand is time-consuming and challenging, Tetra Consultants serves to bridge this gap by providing a cost-effective nominee and resident director service in Thailand.

Residency requirements for Thailand companies

• For public limited companies in Thailand, at least half of the directors on the board must reside in Thailand. In general, the Thailand Foreign Business Act also recommends a minimum of 1 resident director in each Thai entity, although it is not compulsory. As such, you may wish to appoint a Thai resident director to fulfil such criteria if you are looking to set up a public limited company. 

Challenges in securing full foreign ownership 

• For other Thai entities, you may also wish to secure a resident director despite it not being mandatory. This is as although Thai entities are usually allowed to have full foreign ownership, obtaining a Foreign Business License which enables full foreign ownership is a tedious process, so you may want to use resident directors or resident nominee shareholders instead of seeking full foreign ownership.

Restrictions on fully foreign-owned entities

• Even if you manage to secure a Foreign Business License, Thai entities with majority foreign ownership are prohibited from carrying out business in Thailand in certain sectors, so it may be more advantageous to have Thai resident directors and shareholders to avoid these limitations instead of having full foreign ownership.

Why choose a Nominee Director Service in Thailand?

• Choosing to engage nominee director service in Thailand has many advantages, which are as follows:

Fulfil residency requirements or overcome challenges of full foreign ownership

• As mentioned above, Thai resident directors are mandatory for Public Limited Companies. For other entities, it may also be more advantageous to have resident directors instead of full foreign ownership due to the challenges in securing the Thai foreign business license or the restrictions imposed on fully foreign-owned businesses. As such, Tetra Consultants can assist our international clients to circumvent these difficulties or fulfil residency requirements with our reputable Thailand representative director service.

Serve as local representative to Thai banks and authorities

• For other Thai entities as partnerships and private limited companies, although there are no official residency requirements, you may wish to still engage Thailand nominee director services in order to have a local representative for various functions. A local representative is useful in reducing the need to travel, thereby saving time and expenses. This is so that a Thai representative director can be physically present to liaise with local authorities, attend interviews and sign documents.  

• In particular, if you intend to open an account for your business with a Thailand bank, you will require a local representative, as it is not possible to open a Thai business bank account from abroad. At no additional fees, Tetra Consultants’ qualified Thailand representative director will conduct the bank account opening on your behalf, authorized by a Power of Attorney. As such, you will not need to waste time or resources on travel at any point in the process.

• Additionally, having a local representative will also be useful in enabling you to bridge the language barrier in Thailand, as most meetings and corporate or legal documents in the jurisdiction will be in the Thai language. The representative will also be able to assist in translating documents to Thai or from Thai, such that the filing and processing of corporate and legal paperwork will be faster and more efficient.

Maintain privacy and confidentiality

• Furthermore, a common reason that nominee directors and nominee shareholder services are used is privacy. With nominee directors and shareholders, you will be able to maintain confidentiality and anonymity, as your personal information or identity as a business owner will not be publicly listed in the Thai companies registry with a nominee to represent you instead.

Enjoy benefits of the US-Thailand Amity Treaty

• Lastly, foreign investors or owners who are from the United States or who otherwise wish to benefit from the US-Thailand Amity Treaty may wish to appoint US nominee directors in order to qualify for the incentives and advantages afforded by the Treaty. More details about the Treaty will be elaborated on below.

What is the US-Thailand Amity Treaty?

• The new US-Thai Treaty of Amity was signed by the United States and Thailand to give American business owners special rights and privileges during company registration in Thailand.

Requirements to register a company under the Treaty of Amity

• At least 51% of the company shares are held by American citizens and half of the directors in the company are American citizens. 

• The share capital of the Thai business is at least US$63,000.

Benefits of companies set up under the Treaty of Amity

• Such entities are authorized to carry out investment and business activities without the need to have Thai directors or shareholders on the board. 

• The company will also be able to conduct investment and business activities in Thailand without having to secure a foreign business license, in all local industries except for communications, domestic trade in local agriculture, real estate and property, transport, banking and fiduciary sectors, if the activity does not involve exploiting natural resources.

• If your company qualifies for the Treaty of Amity, Tetra Consultants can assist you with registration of your corporate entity hassle-free.

Disadvantages of using nominee director service in Thailand

• Although there are many benefits to engaging a nominee director service in  Thailand, there are a few risks involved.

• If you are opening a corporate account with a Thai bank, the Thai nominee director will have to carry out the process on your behalf, as it is not possible to open a Thai corporate bank account from overseas. As such, the nominee director may have access to your company’s sensitive information and bank account, which may compromise your company’s funds or authority.

• In addition, the Thai nominee director has legal access to the same range of powers and authority granted to company directors under local law. This will give the nominee director the power to make decisions in the company on his or her own. 

• However, Tetra Consultants will take steps to mitigate this risk by setting out clear terms for the role and powers of the nominee director we appoint. Unless specifically requested, in the Nominee Director Agreements that we draft at the start of the engagement, the nominee director will only act based on the instructions from the Ultimate Beneficial Owner and will be prohibited from acting in his or her own self-interest or without your consent. 

• He or she will be strictly prohibited from managing your company’s funds or interfere with the day-to-day running of your business. Hence, you will be guaranteed to maintain full control over your business at all times without having to worry about your authority or business integrity being compromised.

Risks undertaken by a nominee director in Thailand

• Besides the disadvantages incurred by the hiring company, there are also some risks involved for the nominee director himself or herself in agreeing to take on the role. In the event that the company breaches any laws, the Thailand nominee director may be held legally responsible despite not being the culprit. The nominee is hence subject to litigation and fiduciary risks, because he or she will be held liable together with the other executive directors under local law. 

• However, Tetra Consultants will take prior action to mitigate this risk. The nominee director appointed for your business will be a qualified and reliable individual who has gone through our stringent KYC checks and due diligence process and will monitor the business’ activities closely to ensure strict compliance with all local regulations. Hence, by engaging Tetra Consultants’ Thailand representative director service, you will be able to minimize such risks.

Why choose Tetra Consultants’ Thailand nominee director services?

• The nominee director appointed by Tetra Consultants’ will go through strict KYC checks and be knowledgeable of the local Thai legal rules and regulations, such that he is able to monitor your business activities closely to ensure full compliance with all laws. 

• By engaging Tetra Consultants’ nominee director service Thailand, you will also be able to maintain full authority and control over your business, as the nominee director we appoint will not be able to interfere in the daily operations and running of your business without consent, nor have access to your business bank account funds as per the terms of the Nominee Director Agreement.

• In addition, unlike other firms, we highly value transparency and do not charge our international clients with deposits, nor do we have any hidden costs. All payment terms will be stated clearly in the appointment letter prior to the start of the engagement without any information withheld.

How can Tetra Consultants provide nominee director service in Thailand?

• Before the start of the engagement, Tetra Consultants’ compliance team will first shortlist trusted individuals who have relevant experience in corporate governance and annual reporting or filing, and have passed our enhanced due diligence checks. These nominees are usually either our in-house employees or long-term partners and are mostly professionals in the field of accounting or tax or law.

• Once engaged, Tetra Consultants will provide you with the KYC documents of the nominated Thailand director, including his or her updated resume, passport copy, proof of address and legal records proving lack of criminal activity.

• Our legal team will also draft a nominee director agreement and statutory declaration to be signed by all parties involved. This is to guarantee that the company is completely and fully under your management and that you are indemnified as well. Unless requested specifically, the role of the nominee director appointed will not include playing an active part in your business, nor acting as a signatory to the bank.

• After the settlement of the nominee director fee, Tetra Consultants will proceed with registration of the Thai company and the appointment of the Thailand nominee director with the Thai Department of Business Development.

Required documents for nominee director service in Thailand

• Due to the litigation and fiduciary risks that the Thailand resident director will ultimately be subjected to, Tetra Consultants’ compliance team will require certain information from your business for our KYC due diligence checks:

• • Identity documents of the Ultimate Beneficial Owners (UBOs) and non-resident directors.

• • Documents of the parent business (in the event a corporate shareholder is appointed)

• • Nature of intended business activity

• • Dormant or active status of the Thailand company

• Contact us to find out more about Thailand Nominee Director services. Our team of experts will revert within the next 24 hours.

FAQ

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