What are the estimated monthly overhead costs and other business expenses for foreign companies in Thailand?
There is no simple formula for calculating this as there are numerous variables, such as size of business, type of activity, industrial or service sector, percentage of expatriate staff, industry, etc. However, to assist foreign companies, the Board of Investment annually published a Cost of Doing Business in Thailand report.
What are Thailand’s major business associations?
There are numerous business organizations, including the Federation of the Thai Industries, the Thai Chamber of Commerce, the Board of Trade and foreign chambers of commerce. In addition, there are a large number of industry specific organizations.
Where can I obtain the schedule of trade exhibitions and trade fairs in Thailand?
There are many major trade fairs held in Thailand each year. The website www.thaitradefair.com lists many of them, complete with application forms for exhibitors.
Where can I find contact details of freight forwarders, shipping companies, trading companies and buying agents in Thailand?
There are many ways to obtain information about these service providers. The Department of Export Promotion (DEP) (www.thaitrade.com) is an excellent source of information. For example, it publishes an online exporter’s directory that provides a platform through which buyers can obtain information about more than 10,000 exporters, including trading companies.
For freight forwarding and shipping, there are also good resources available through the internet. The website (www.tiffathai.org) of the Thai International Freight Forwarders Association (TIFFA) contains a list of freight forwarders and shippers and provides details about each of its member companies. The Thai Airfreight Forwarders Association website (www.tafathai.org) also provides detailed information about its members.
Other good resources for contact information would be the websites of the Federation of Thai Industries (www.fti.or.th), as well as the Board of Trade, foreign embassies and foreign chamber of commerce in Thailand.
Where can I obtain a list of Thai importers and exporters, with contact information?
The Department of Export Promotion provides an extensive list of exporters through their website www.depthai.go.th and both the Federation of Thai Industries and Thai Chamber of Commerce publish directories that can be purchased.
Where can I get the latest list of import tariffs, customs duties and excise tax rates for all product categories from each country?
Information on import tariffs/customs duties are available from the Customs Department (www.customs.go.th), while information pertaining to excise tax can be obtained from the Excise Department (www.excise.go.th).
Who can help resolve trade disputes with Thai companies in the case of a breach of a trading contract or export of defective products?
Thailand has a civil and commercial code, including a Bankruptcy Act. Monetary judgments are calculated at the market exchange rate. Decisions of foreign courts are not accepted or enforceable in Thai courts. Disputes such as the enforcement of property or contract rights have generally been resolved through the Thai courts. Thailand has an independent judiciary that generally is effective in enforcing property and contractual rights.
In addition, companies may establish their own arbitration agreements. Thailand signed the Convention on the Settlement of Investment Disputes Between States and Nationals of Other States in 19885, but has not yet ratified the Convention. Thailand is a member of the New York Convention, however, and enacted its own rules on conciliation and arbitration in the Arbitration Act of Office of the Ministry of Justice administers these procedures.
Where can I find a list of law firms that specialized in the establishment of foreign businesses?
The Layers Council of Thailand can provide a list on request. They can be contacted at www.lawyerscouncil.or.th.
What are the modes of transportation for shipping imported commodities to upcountry locations? What are the costs?
Goods can be shipped by rail or road. Examples of costs for each can be found in the BOI publication Cost of Doing Business in Thailand.
What are the rules and regulations relating to the transportation of commodities across the Thai border to neighboring countries?
When a shipment arrives or leaves Thailand, importers or exporters are required to file a goods Declaration with supporting documents to the Customs for cargo clearance. To speed up and facilitate the flow and movement of legitimate cargo, most applications for an Import & Export Declaration are submitted electronically via the e-Import and e-Export system.
Import Declaration & Clearance Process
Under the e-Import system, there is no need for relevant parties to submit paper documents as all data is transmitted electronically from an importer computer system to a Customs com. puter system via a Gateway Provider. Generally, declaration and clearance process include 4 stages:
Transmission and/or Submission of a Declaration: The first stage of import clearance process is to complete an Import Declaration and transmit it to Customs. Prior to the arrival of cargo or upon the arrival of cargo, a shipping company/agent forwards a ship arrival report, and manifest to the Customs’ computer system. If there is error, the ship arrival report number is automatically generated by the system and the response message is forwarded to the shipping company/ agent. When the cargo arrives at the port or place of entry, an importer or a Customs broker forwards an Import Declaration to the Customs computer system.
Check and Verification of the Declaration: The second stage is the check and verification of the Declaration and all supporting documents made by an importer. Again, the customs computer system validates the given data and issues a Declaration and Payment Numbers within a minute in conjunction with the e-payment. In addition, the selectivity profile system will validate the transmitted data and classify the Goods Declaration into two categories: Green and Red Lines.
Payment of Import Duties and Taxes: The third stage is payment of applicable duties and taxes and/or guarantee. There are currently 2 options for the payment of import duties and taxes: payment at the Customs Department, and payment via e-Payment system.
Inspection and Release of Cargo: The last stage is to inspect and finally release cargo from Customs custody. An importer submits the verified Declaration together with the payment receipt at appropriate warehouses for the release of goods. At this stage, cargo data is screened against predetermined selectivity criteria in order to indicate whether the Declaration is under a Red Line (requiring through physical checking) or a Green Line (Permission of release). A Green Line Declaration is cleared within a minute. Then, the cargo status is electronically forwarded to both the Port Authority and the Importer/Customs broker. However, in cases where the predetermined selectivity criteria indicates that the cargo is subject to the Red Line, the Port Authority removes the cargo container for physical inspection by Customs before the release of the cargo.
Documents The minimum documents required for the clearance of imports consists of :
- Import Declaration (Electronic Document)
- Bill of Lading (B/L) or Air Waybill
- Invoice (Electronic Document)
- Packing List
- Import License (if applicable)
- Certificates of origin (if applicable)
- Other relevant documents such as catalogue, product ingredients, etc.
Export Declaration & Clearance Process
Similar to the e-import system, once the Export Declaration data has been entered into the Customs computer system, it will be subjected to automatic processing, for example, such as data validation, data matching, release status, etc. and the cargo is released. Generally, the export clearance process included 4 stages:
Transmission and/or Submission of a Declaration: The export procedures start when an exporter/broker transmits an Export Declaration using ebXML via the Gateway Provider or the Internet to the Customs computer system.
Check and Verification of a Declaration: The second stage is the check and verification of the Declaration made by an exporter. As soon as the Customs computer system receives the Export Declaration data, such data is preliminary validated. In cases where to the validated data contains no error, the Goods Declaration number is generated in conjunction with the e-Payment system (if export taxes and duties are applicable.). The response message, then is transmitted to the exporter/broker. In addition, the selectivity profile system will validate the transmitted data and classify the Goods Declaration into two categories: Green Line and Red Line.
Payment of Duties and Taxes: The third stage is payment of applicable duties and taxes and/or guarantee. There are 3 means for payment of export duties and taxes: payment at the Custom Department, payment via e-Payment system, and payment at bank.
Inspection and Release of Cargo: The last stage is to inspect and finally release cargo from Customs custody. At this stage, a freight forwarder loads cargo into containers and forwards a cargo control report to the Customs computer system. The Customs system validates the data, and reports any error for immediate online correction. If no error is found, the cargo control report number is automatically generated by the system and the response message is forward to the freight forwarder and the exporter/broker. The freight forwarder then prints out the cargo control report with its number and removes the cargo to the port of exit. At this stage, the Customs officer at a sub-gate checks whether the declaration is a Red Line (requiring through physical checking) or a Green Line. The Green Line Declaration is cleared within a minute while the Red Line cargo is removed for physical inspection. After the cargo is exported, a ship agent is required to forward, the manifest to the Customs computer system. The system then automatically loads the Goods Declaration and transmits the response message back to the exporter/broker.
Documents The minimum documents required to be submitted with the Export Declaration data consists of;
- Export Declaration data
- Export License (if applicable)
- Certificates of Origin (if applicable)
- Other relevant documents such as catalogue, product ingredients, etc.
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