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Third Country Nationals and US-Thai Amity Treaty Companies

Transcript of the above video:

In today's video, we're going to be discussing the U.S. Thai Treaty of Amity specifically how it impacts corporations here in Thailand with a specific emphasis on looking at so-called third country nationals and how they can interact internally within an Amity treaty structure here in Thailand.

So first of all, what is the U.S. Thai Treaty of Amity? It's a bilateral agreement between the United States and the Kingdom of Thailand. The provisions of the treaty allow certain types of companies here in the Kingdom to be owned 100% by American citizens notwithstanding the provisions in the foreign business Act which requires certain types of business activity or certain types of corporate entities that perform certain business functions to be owned at least a majority by Thai. That being said, the treaty of amity sort of supersedes the foreign business act so those utilizing the treaty can can go ahead and get a company certified and the a Thai company that's treaty certified here in the Kingdom is going to be granted what's called national treatment. So that company even if it is majority owned by an American citizen, that company will be treated as if it was a Thai company.

This is a fairly important provision with respect to Americans doing business here. It's very useful for American citizens who wish to operate here in the Kingdom of Thailand and those various business entities from the United States who may want to operate here in the Kingdom of Thailand. Now this being said, I do often get asked the question what if I'm saved from the UK and I have a business partner that once, we want to do business here - he is going to be the majority shareholder, I'm going to be a minority shareholder, we want to get that company treaty certified.

Well the fact of the matter is pursuant to not just the provisions of the treaty itself but the way the treaty’s been interpreted in the way that it's enforced at least here in the Kingdom and the regulations related thereto, only American citizens or Thai citizens can be shareholders and directors on the company a.k.a. principals on the company.

That being said, third country nationals can be employed by the company if necessary because even a Thai company can go ahead and employ third country nationals notwithstanding the fact that they have a separate nationality. So under the National treatment sort of policy that underlies treaty protection, an American treaty company is going to be treated the same way that a Thai company would otherwise be treated. So a Thai company can go ahead and hire somebody from the U.K. therefore so can a Thai national treatment company and Amity company hire someone.

But that being said that individual of a third country nationality is not going to be able to own shares in the company and cannot be a director on the company. So all they can do is be quite literally an employee of the company. In certain instances, this can be rather useful. Under other circumstances frankly, it creates rather a bar for any third country national to have any real dealings with amity structures internally.

Again, it should be noted that there are various structures that might be utilized for foreign nationals to go ahead and conduct certain types of business activities here in the Kingdom and we're not going to get into those in this video. But it should just be noted that if you take nothing else away from this video, amity treaty companies should contain as shareholders and directors only American citizens or Thai citizens.