As in the West, shareholders play a huge part in any business in Thailand whether they are Thai owned or foreign owned. But they are also important for register a company in Thailand if you are a foreigner looking to expand your business in the Asia region or are just wanting a start up to test if your new killer idea will be the next big thing. As you would expect, because you are registering a company in a foreign company then most of the shareholders need to actually be Thai.
Now what do you do if you do not have any real Thai friends as you are new to the country? Well there are plenty of businesses out there that will assist you in performing this task and getting your business off the ground but it helps if you learn more about Thai business law and the roles shareholders play also. For example there is what is called a nominee shareholder. This is not someone who actually has any active shares in the company but instead is someone who is simply a shareholder in name only and thus would be a dummy shareholder if you wanted to be exact and this is an illegal practice in Thailand.
This means that they have no financial stake in your company and as said this is illegal and makes a lot of sense why it is as it would mean that the business exists on paper only. If there are shareholders in a company and these shareholders do not exist then it says a lot about the company itself and the way it operates if they are not prepared to respect and abide by Thai law. And following Thai law when registering a company in Thailand is exceedingly important. The benefits of registering a company where the majority of shareholders are obvious. It allows the business, providing over 50% of shareholders are Thai, to operate in areas or services that would usually be restricted to foreigners. This essentially means that if your company dealt with land back in your own country then when you register company in Thailand you need to make sure over 50% of shareholders are Thai otherwise your company cannot work in areas that deal with land and thus your business would clearly suffer.
When you look at Thai law this makes sense as any foreigner who lives legally in Thailand cannot deal with land either. It all has to be done by Thai people in their name and this is why, as said, there are many companies out there that are willing to help in this respect. Registering a company in Thailand can be a time consuming process but it is definitely worth it if you meet the requirements and stay inside the law as the Thai police look down on businesses that are illegally operating in Thailand even if you have seen or heard differently as it can be seen as a sign that the laws and customs of Thailand are not being respected and Thai people are very proud of their heritage.