Thailand Board of Investment (BOI) application tips.

Foreign investors who apply for the Board of Investment (BOI) promotion may face some practical issues that lead to their application being rejected. In this guide, we put together some tips regarding the BOI application to ensure you have met the requirements and qualifications.

Let’s start.

Checklist of documents for BOI application

When applying for BOI promotion, you must ensure you have prepared the required documents, which include:

• Two sets of complete application forms:
  • Application form for Investment Promotion for all Eligible Activities (F PA PP 01)
  • Application form for Investment Promotion of Services Activities (F PA PP 03)
  • Application form for Investment Promotion of Software and E-Commerce (F PA PP 04)
  • Application form for Small and Medium Enterprises (F PA PP 29)
• For individuals:
  • National identification card or passport of applicant
• For juristic entities:
  • Copy of most recent financial statements (if any)
  • Copy of current list of shareholders or shareholding distribution report
  • Copy of the current certificate of business registration issued within the last six months
• Attorney-in-fact (authorised person)
  • Power of attorney affixed with stamp duties
  • Certified true copy of national identification card or passport of the applicant
  • National identification card or passport of authorised person
• Projects with an investment value of over THB 750 million (excluding cost of land and working capital)
  • Project feasibility study report
• Activities concerning environmental impacts (only if involving the dyeing process or for the manufacturing for batteries or flashlight batteries)
  • Preliminary Environmental Impact Assessment Form (F PA PP 15)
• Application for additional rights and privileges
  • Enhancing competitiveness (F PA PP 37)
  • Energy conservation-use of renewable energy-reduction of environmental impacts (F PA PP 28)
  • Adjustment and change of machinery to increase manufacturing efficiency (F PA PP 30)
• Applications under category 7.12 Biotechnology
  • Supplementary Form for Applications for Investment Promotion under Category 7.12 Biotechnology (F PA PP 19)

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Criteria for BOI approval

To receive approval, the investment must meet the following criteria:

1. To develop competitiveness in the agriculture, industrial and service sectors, projects submitted for BOI promotion must have the following qualifications:
   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 centres, which must have a value-added of at least 10% of revenues
   2. Modern production processes must be used
   3. New machinery must be used
   4. Projects that have an investment capital of THB 10 million or more (excluding cost of land and working capital) must obtain ISO 9000 or ISO 14000 certification or a similar international standard certification within two years
2. Environmental protection
3. Minimum capital investment and project feasibility
   1. The minimum capital investment of each project is THB 1 million
   2. Projects with an investment over THB 750 million (excluding cost of land and working capital) must submit the project’s feasibility study

When to apply for BOI promotion?

The BOI allows investors to apply for BOI promotion before and after company registration. However, there are certain advantages to setting up a Thai company first.

If you apply for BOI promotion as a foreign company, you will need to provide various corporate documents and supporting information which will have to be translated and/or notarised. Creating a Thai company first will simplify and fasten administrative procedures.

Another reason to establish the company first relates to making the most effective use of time. Instead of waiting for the BOI to process your application, you can use those months productively by obtaining all the necessary components of your business, such as leasing a factory or importing and installing necessary machinery.

By doing this, you can have everything that needs to be done to commence operations as soon as the BOI approves the promotion.

Tips when preparing the BOI application

When preparing your BOI application, do not try to hide potential losses. If your budget anticipates losses during the early stages of the business application, do not be afraid to disclose this.

You should also be honest about the level of intended investment. The BOI is interested in ensuring that the amount of your investment is appropriate to the type of activity and size of your project.

You also should not overestimate your forecasted profits. The BOI offices may not be experts in your sector, but they have evaluated enough business proposals to know what margins and profits might be expected for a business of your size and type.

Another thing to consider is engaging the help of a Thai lawyer when applying for the BOI promotion, as you may make errors in the application stage and monitoring process.

Conclusion

When you decide to apply for BOI promotion application, it is necessary to prepare the documents required by the BOI and meet certain criteria so that your project qualifies. If you need any help, Acclime has a team of experienced lawyers who can assist you through your BOI application.