US-Thai Treaty of Amity

The US-Thai Treaty of Amity provides significant benefits and legal protection to American citizens and companies. Tila legal can assist with submitting documents and getting certification from the commercial section at the US Embassy to qualify for this protection.

An Amity treaty company receives “National Treatment.” It also takes longer and is more expensive to register than a Thai or foreign non-Amity treaty majority owned company.

National Treatment

The Thailand-US Treaty of Amity provides significant benefits and rights to US citizens or companies that register their businesses as Amity Treaty entities. These companies can operate as though they are Thai companies, but have the added benefit of not having to pay any corporate tax.

Companies that wish to operate under the provisions of the Treaty must first obtain a certification letter from the U.S. Commercial Service office in Bangkok. This office will verify that the company meets certain requirements, including that a majority of the shareholders or directors are American citizens.

Once a Treaty of Amity company has been certified, it will be free to engage in most business activities in Thailand that are restricted by the Foreign Business Act. However, a treaty company cannot engage in those activities that are reserved for nationals of the host country (telecommunications, transportation, fiduciary functions, banking involving depository functions, land ownership and exploitation of land or natural resources). In addition, a company operating under the treaty must have a minimum capital of $3M.

Ownership Rights

Under the Treaty of Amity, American companies can maintain a majority ownership and control of their Thailand operations. This exception from restrictions on foreign equity provides a competitive edge.

In practice, however, the ability to take advantage of these provisions may be restricted by specific Thai laws regulating the industry in question. For example, the Foreign Business Act stipulates that any specific law governing the foreign ownership of tourism businesses takes precedence over the Treaty of Amity’s provisions.

The courts are generally effective in enforcing property and contract rights, though the legal process is slow, and litigants or third parties may interfere with court decisions. Enforcement of patent rights is a concern, as the Department of Intellectual Property struggles to examine and issue patents in a timely fashion. It takes, on average, six to eight years for technology patents and as much as 15-18 years for pharmaceutical patents to be examined. The Constitution protects real estate owned by foreigners from confiscation by the state without compensation, and security interests in land are recognized.

Joint Ventures

Under the treaty, companies that receive treaty benefits have a simplified and more streamlined process to obtain a Foreign Business License (FBL). However, this does not mean that the company is exempt from restrictions on certain sectors of business such as banking, fiduciary functions, exploitation of land or natural resources.

The company must be incorporated as a Thai limited company (Co., Ltd). The majority shareholders and directors must be American citizens or have a valid U.S. visa. Directors who are of third countries must co-sign with an authorized director who is a US citizen or have a valid work permit.

Setting up a treaty company is not easy and requires careful consideration of the company’s activities and future plans. GPS Legal is well-versed in navigating this process and ensuring that all documents meet the necessary requirements. Contact us today for a free consultation. We can help you get started with a treaty company in Thailand!


Under the Treaty of Amity and its TIFA provisions, American citizens can wholly own businesses incorporated in Thailand. In addition, the companies are exempt from most restrictions imposed by the Foreign Business Act and can operate on an equal basis with Thai companies. To qualify for these privileges, the company must receive certification from the US Embassy.

TIFA meetings provide opportunities for the governments to work together on issues such as intellectual property rights, investment, sanitary and phytosanitary measures and trade facilitation. They are held regularly and include government officials, industry representatives and experts from both countries.

In the past, US firms have reported problems with gratuity payments to civil servants responsible for enforcing regulations. These payments are often made to obtain regulatory clearance or expedite a licensing process. In addition, private property can be confiscated by the government for public purposes if deemed necessary. However, these exceptions are regulated by specific laws and have not been a major issue for most companies.

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