Fighting corruption was one of the grounds put forward by the military junta when, in May 2014, they seized power in Thailand, indicting the former prime minister Yingluck Shinawatra over a rice subsidies scheme, allegedly used to buy votes. In October last year, the junta duly found itself in the midst of corruption allegations over procurement of equipment for Government House. In the latest instalment of our Behind the Paywall blog series, we take a look at how to run corporate registration checks in order to conduct due diligence in this complex environment.
As Southeast Asia’s second largest economy and a traditional destination for foreign investment in the region, Thailand saw its ranking in the World Bank’s Ease of Doing Business further improve last year and also climbed six places in the World Economic Forum’s latest Global Competitiveness Report. However, economic growth has slowed recently, putting pressure on the junta to initiate reforms to halt the worrying outflow of capital.
Among the measures taken recently to tackle corruption is a new reporting requirement for financial institutions as well as a strengthening of the Anti-Money Laundering Office (AMLO) to conduct investigations and gather evidence.
Access to corporate information in Thailand (which was evaluated as satisfactory in last year’s Arachnys Open Data Compass) is fairly straightforward with a bilingual English-Thai corporate data search provided by the Department of Business Development. While the English version of the service only provides basic information, such as registration number, company name and address, the Thai language search allows users to obtain the names of directors as well as financial information about businesses.
Bio-Rad, a producer of medical diagnostics equipment, agreed to pay $55 million in late 2014 to settle an FCPA enforcement action focussing on the company’s and its subsidiaries’ conduct in Russia, Vietnam and Thailand.
Information availability summary
|Data point||English-language page (no login)||Thai-language page (login required)|
|Sector of activity||No||Yes|
The most common company structures in Thailand are limited and public companies. In certain areas of activity, such as most services sectors, foreign participation is only allowed up to 49 per cent. A company is categorised as “foreign” when more than 50 per cent of the share capital is held by foreign individuals or companies. To operate in restricted sectors, entities need to obtain a Foreign Business Licence (FBL).
- Formation of a limited company needs at least three shareholders and payment of a registration fee of 5,500 THB per million of capital. Private Limited Companies are governed by the Civil and Commercial Code.
- Public companies, which are entitled to be listed on the Stock Exchange of Thailand, need at least 15 shareholders for formation. The registration fee is 2,000 THB per million THB of registered capital. They are governed by the Public Limited Company Act.
Sources of information
A search for Bio Rad in the English-language data warehouse (make sure to select the “begin with” search option) returns the registration number, company name, registration date, status and address of the company. An important point for overseas investigators to note is that the website displays dates according to the Buddhist calendar, which is 543 years ahead of the Gregorian calendar.
As company names need to be entered in Thai in the Thai version of the database, using the registration number obtained on the English-language website allows investigators to circumvent potential translation difficulties. After registering and obtaining a login for the Thai version of the database, which requires a Thai ID card or any passport as well as an address in Thailand, investigators can search by company registration number or name.
In addition to the information provided on the English-language search, the results page also provides the company’s registered capital in the search results.
More details, including the names of the company’s directors alongside address and sector of activity can be obtained on click-through.
Shareholder names are not available from this database. However, it does indicate the number of shareholders and their nationality and amount of investment.
In this case, there are four American and three Australian shareholders, the former holding 99.98% of the company.
Finally, the data warehouse also provides detailed financial information for the last three years.
Searching by individual
Although the names of directors are included in search results, the Data Warehouse does not provide the option to search by the name of an individual.
The Thai Department of Business Development’s Business Data Warehouse is a centralised registry with straightforward access to corporate information. While the English version of the website carries a limited amount of data, the Thai version gives access to names of directors and capital among others. Signing up to the latter is possible with a foreign passport, although the requirement to provide a local Thai address could be a stumbling block for overseas investigators.
Written by Radu Botez, Researcher at Arachnys. Arachnys is a digital platform that consolidates and aggregates business information from sources like the ones featured here to make due diligence research quicker and more effective. Contact the author at firstname.lastname@example.org to find out more.