Thailand
Shipowner Eligibility
While the registered owner of a Thai vessel must be a Thai national or body corporate, foreigners may participate in ownership; 30% of the total shares may be foreign owned for operators within the Thai territory and 49% of the registered capital may be owned by foreign shareholders in order to operate sea transportation internationally.
Any private Thai company carrying out internal sea transportation and having its main office within the Thai sovereignty must have the following qualifications:
• The majority of directors must be Thai nationals and the capital of the company must be at least 70% owned by Thai individuals; or
• 70% of the registered capital of the company must be owned by Thai companies in which all directors and shareholders of these companies are Thai individuals; or
• The total registered capital must be owned by two or more juristic persons who are eligible to own a Thai-flag vessel.
As for any Thai company carrying out international sea transportation:
• The registered capital must be at least 51% owned by Thai individuals; or
• Not less than 51% of the registered capital must be owned by Thai companies in which not less than 50% of all directors must be Thai individuals; or
• The total registered capital must be owned by two juristic persons or more, under the condition that these companies must be qualified to operate international sea transportation and own Thai-flag vessels.
About the Flag
A member of the Association of ASEAN, the UN, and the IMO, Thailand is a constitutional monarchy located on the Indochinese and the East Peninsulas in Southeast Asia. It borders Myanmar to the west, Laos to the north, Cambodia to the east and Malaysia to the south. The official language is Thai, and the capital city is Bangkok. The King is the chief of state, the Prime Minister is the head of government, and it has a bicameral national assembly. The legal system is based on civil law with influences of common law.
As one of the more advanced developing countries in Asia, Thailand depends on exports of manufactured products and the development of the service sector. Machinery, computers and parts, and manufactured products along with agricultural products and fisheries are the chief exports. Its major trading partners are Japan and the United States and tourism is the largest source of foreign income. The unit of currency is the baht, and the chief ports are Bangkok, Laem Chabang, Sattahip, Songkhla, and Phuket.
The Thai Vessel Act B.E. 2481 (1938), administered by the Ministry of Transport and Communications, regulates the qualification of merchant shipping operators. Other laws governing water transport include the Collision Prevention Act B.E. 2522 (1979), the Navigation in Thai Waters Act B.E. 2455 (1913), the Arrest of Ships Act B.E. 2534 (1991), the Carriage of Goods by Sea Act B.E. 2534 (1991), the Ship Mortgages and Maritime Preferential Rights Act B.E. 2537 (1994), the General Average Relating to Sea Peril in the Navigation Act B.E. 2547 (2004) and the Civil Liabilities and Damages Relating to the Vessel Collision Act B.E. 2548 (2005).
Company Formation
In order to set up a private limited company in Thailand, a Memorandum of Association must be registered with the Ministry of Commerce. By law, at least seven individual promoters are required. Next, a statutory meeting must be convened to adopt the Articles of Association and to select the authorized directors. At least 25% of the value of each share must be paid up. The promoters shall next pass the business of the company to the directors. Within three weeks after the statutory meeting, the directors must apply to register the incorporation of the company.
The shares of a limited company can be issued only as ordinary or preferred shares. The amount of a share must not be less than five baht, but a company may issue shares at a higher price than the par value. Dividends on shares can be paid to the shareholder if the company has made a profit. The company must appropriate a reserve fund of at least one twentieth of the profits until the reserve fund reaches one tenth of the capital of the company. In general, the proportion of shares in a Thai limited company is more than 50% owned by Thai nationals; the rest may be owned by foreigners. Shareholders can be persons and/or juristic persons.
The Board of Directors must produce a balance sheet at least once in every twelve months, which must be examined by the company's auditor and submitted for adoption to a general meeting within four months. It must be submitted to the Registrar not later than one month after it has been adopted by the general meeting. There are two types of resolutions; ordinary and special. An ordinary resolution requires a majority vote of the shareholders attending the meeting (although the Articles of Association of some companies may set a different percentage of voting rights); a special resolution shall be passed by two successive general meetings, the first by a majority vote of not less than three-quarters of the votes and the subsequent meeting of not less than two-thirds of the votes.
Taxation
Taxation on income in Thailand is governed by the Revenue Code. In general, corporate tax is collected from net profit. The Revenue Code states that the Revenue Officer will impose a tax on foreign enterprises carrying out international transportation at a rate of 3% of the gross income (freight, fees or other benefits). If Thailand has entered into a double taxation treaty with any country, the tax rate may be reduced by 50%.
Up to now, Thailand has signed a double taxation treaty with 49 countries throughout the world, namely: Armenia, Australia, Austria, Bahrain, Bangladesh, Belgium, Bulgaria, Canada, the Peoples' Republic of China, Cyprus, the Czech Republic, Denmark, Finland, France, Germany, Hungary, India, Indonesia, Israel, Italy, Japan, Korea, Laos, Luxembourg, Malaysia, Mauritius, Nepal, the Netherlands, New Zealand, Norway, Oman, Pakistan, the Philippines, Poland, Romania, Singapore, Slovenia, South Africa, Spain, Sri Lanka, Sweden, Switzerland, Turkey, the Ukraine, the United Arab Emirates, the United Kingdom, the United States of America, Uzbekistan and Vietnam.
Value added tax is collected on all types of business such as sales, services, and the import and export of goods. In order to promote the country's exports, zero-rate tax is currently levied on export businesses. The zero-rate tax is also applied when computing value added tax for an international transport service by aircraft or sea-going vessels from a supplier who is a juristic person.
In order to promote and encourage the use of Thai-flag vessels by maritime operators, the following incentives have been granted:
• A Thai maritime operator using a Thai-flag vessel and having the number of Thai crew on board as required by law, shall be exempt from income tax for income arising from providing international sea transportation. Moreover, in order to be exempt from corporate income tax, the Thai maritime operator shall submit a request for registration to the competent official at the Revenue Office where the head office of the business is located.
• An ordinary person residing in Thailand or a company established under Thai law that receives a dividend from a Thai maritime operator that is exempt from income tax shall also not be taxed.
• Regardless of the nationality of the crew, income in the form of salary or wages received by the crew for working on board a Thai Vessel used for international sea transportation shall not be taxed.
• In accordance with the Maritime Promotion Act B.E.2521, importation of accessories, cargo or goods by government agencies or under a government contract must be delivered into Thailand using Thai Vessel only.
Registration and Documentation
Under the Vessel Acts, the registration of a Thai vessel normally takes place at the Registration Division of the Marine Transport Department in Bangkok or at one of the 41 regional Harbour Offices throughout Thailand. Vessels may be provisionally registered outside of Thailand through an embassy or consulate or the officials of the Survey Division for a period of six months. Currently, the vessel does not need to be present at a Thai port.
The following original documents must be presented at the time of registration:
• Harbour Department Registration Application
• Memorandum of Agreement
• Bill of Sale or Builder's Document translated into Thai
• Certificate of Deletion issued by the country of prior registry
• Corporate Documents of the applicant including a shareholder list which has been certified by the Department of Commercial Registration within the six months prior to the vessel registration
• Power of Attorney
• Survey Certificate issued by the Survey Division of the Harbour Department
The Harbour officials require the original of the above documents, with Thai translations where the documents are in a foreign language.
The Ship Registry Certificate for a Thai-flag vessel will endure for a lifetime or until the Certificate is revoked due to a disqualification under the Thai Vessels Act.
Bareboat Charter Registration
Thailand does not allow dual registration of the Thai flag.
Vessel and Yacht Eligibility & Survey Requirements
Please contact the Marine Department. Email: marine@md.go.th
Crewing
For Thai vessels operating in Thai waters, 100% of the officers and crew members onboard the vessels must be of Thai nationality. For Thai vessels operating cargo transport in international waters, not less than 50% of the officers and crew members on board the vessels must be of Thai nationality. Foreign officers must hold Certificates of Competency that are deemed to be the equivalent of Thai certificates.
Normally, the Harbour Department requires the submission of an agreement and crew list of a Thai vessel, which contains information relating to the name of the ship owner, name of the vessel and the ship's particulars, port of licence, date of agreement, the agreement details between the crew members and the ship owner, and instructions to the master.
Mortgages
A mortgage may be registered with the Harbour Department securing a sea-going Thai flag vessel of 60 or more GRT pursuant to the Ship Mortgage and Maritime Preferential Rights Act, B.E. 2537 (1994). As for ships or vessels of 6 or more GRT and steam launches or motor boats of 5 or more GRT but less than 60 GRT, these may be mortgaged pursuant to the Thai Civil and Commercial Code.
The following original documents are required for registration:
• Completed Harbour Department Mortgage application
• Affidavit, list of shareholders, Articles of Association, and Memorandum of Association and/or any other corporate documents all certified by the Ministry of Commerce for both the mortgagee and the mortgagor in the case where they are domiciled in Thailand
• Original Power of Attorney for both the mortgagee and mortgagor
• Four counterparts of the Mortgage, with Thai translation if it is in a foreign language
• Original Thai Certificate of Registry
• Others, as required by the Harbour Official
A mortgage may also be registered outside of Thailand by presentation of the above documents at any Thai embassy or consulate. Whether the mortgage is to be registered with the Harbour Department or overseas, the representatives of both the mortgagee and the mortgagor must submit all documents to the Senior Registrar for scrutiny and confirmation of his satisfaction prior to the registration of the mortgage. Upon registration, the encumbrance shall be noted on the vessel's Certificate of Registry.
Unless the mortgage document states otherwise, in the event that the vessel is considered lost or damaged, the mortgage will cover the entire vessel and all equipment existing at the time of the mortgage registration and subsequent thereto, as well as the right to claim for compensation for wrongful acts, insurance proceeds, general average and compensation if the vessel has been used for search and rescue.
Fees
Please contact the Marine Department. Email: marine@md.go.th
Contact
Harbor Department
1278 Yotha Road, Talad Noi, Samphanthawong, Bangkok 10100
Tel: 0-22331311-8
Fax: 0-2238-3017
Email: marine@md.go.th
Website: http://www.md.go.th
Stockholm Agreement 96
IMO Convention 48
* IMO amendments 91
* IMO amendments 93
SOLAS Convention 74
SOLAS Protocol 78
SOLAS Protocol 88
LOAD LINES Convention 66
LOAD LINES Protocol 88
TONNAGE Convention 69
COLREG Convention 72
CSC Convention 72
CSC amendments 93
SFV Protocol 93
STCW Convention 78
STCW-F Convention 95
SAR Convention 79
STP Agreement 71
STP Protocol 73
IMSO Convention 76
INMARSAT OA 76
INMARSAT amendments 94
INMARSAT amendments 98
IMSO amendments 2006
IMSO amendments 2008
FACILITATION Convention 65
MARPOL 73/78 (Annex I/II)
MARPOL 73/78 (Annex IV)
MARPOL 73/78 (Annex V)
MARPOL Protocol 97 (Annex VI)
London Convention 72
London Convention Protocol 96
INTERVENTION Convention 69
INTERVENTION Protocol 73
CLC Convention 69
CLC Protocol 76
CLC Protocol 92
FUND Convention 71
FUND Protocol 92
FUND Protocol 2003
NUCLEAR Convention 71
MARPOL 73/78 (Annex III)
PAL Protocol 76
PAL Protocol 90
PAL Protocol 02
LLMC Convention 76
LLMC Protocol 96
SUA Convention 2005
SUA Protocol 2005
SALVAGE Convention 89
OPRC Convention 90
HNS Convention 96
OPRC/HNS 2000
BUNKERS CONVENTION 01
ANTI FOULING 01
BALLASTWATER 2004
NAIROBI WRC 2007
HONG KONG CONVENTION
HNS PROT 2010
Cape Town Agreement 2012
SUA Convention 88
SUA Protocol 88
IMO Conventions
Status of Conventions Thailand
IMO Convention 48 x
SOLAS Convention 74 x
SOLAS Protocol 78
SOLAS Protocol 88
SOLAS Agreement 96
LOAD LINES Convention 66 x
LOAD LINES Protocol 88
TONNAGE Convention 69 x
COLREG Convention 72 x
CSC Convention 72
CSC amendments 93
SFV Protocol 93
Cape Town Agreement 2012
STCW Convention 78 x
STCW-F Convention 95
SAR Convention 79
STP Agreement 71
Space STP Protocol 73
IMSO Convention 76 x
INMARSAT OA 76 x
IMSO amendments 2006
IMSO amendments 2008
FACILITATION Convention 65 x
MARPOL 73/78 (Annex I/II) x
MARPOL 73/78 (Annex III)
MARPOL 73/78 (Annex IV)
MARPOL 73/78 (Annex V)
MARPOL Protocol 97 (Annex VI)
London Convention 72
London Convention Protocol 96
INTERVENTION Convention 69
INTERVENTION Protocol 73
CLC Convention 69
CLC Protocol 76
CLC Protocol 92 x
FUND Protocol 76
FUND Protocol 92 x
FUND Protocol 2003
NUCLEAR Convention 71
PAL Convention 74
PAL Protocol 76
PAL Protocol 90
PAL Protocol 02
LLMC Convention 76
LLMC Protocol 96
SUA Convention 88
SUA Protocol 88
SUA Convention 2005
SUA Protocol 2005
SALVAGE Convention 89 x
OPRC Convention 90 x
HNS Convention 96
HNS PROT 2010
OPRC/HNS 2000
BUNKERS CONVENTION 01
ANTI FOULING 2001
BALLASTWATER 2004
NAIROBI WRC 2007
HONG KONG CONVENTION
x= ratification
d=denunciation