Limited company, branch or representative office: a comparison worksheet

01The cost of getting this wrong is not a name change

The three forms differ sharply on whether they can carry on revenue-earning business, how tax is paid, how foreign ownership is counted, and how expatriate headcount is granted. The real cost is not renaming anything — it is business you cannot do, or a tax structure that is wrong throughout. The ways we have seen this go wrong are specific:

• "Let us set up a representative office first and test the water." A few months later the business picks up, an invoice has to be issued, and only then does it emerge that the entity does not support it — a representative office may not earn revenue and may not sign commercial contracts, and its permitted activities are a closed list, so anything beyond it counts as operating in breach. The only way forward is to set up a new company and go through registration and licensing all over again. The time and money spent up to that point is largely wasted.
• Writing the business scope too wide at registration. Alongside manufacturing, items such as trading, retail, distribution, leasing and installation engineering services often get added — and those are exactly the ones that mostly sit on List 2 and List 3 of the foreign business restriction lists, where a foreign-owned company needs a licence before it can operate. Under Article 37 of the Foreign Business Act (FBA), operating a restricted business without a licence or outside the licensed scope carries up to 3 years' imprisonment or a fine of THB 100,000 to 1 million. That is not something a late filing clears up.
• Doing the steps in reverse. Registering the company first, then going back to think about whether to seek promoted status. Promoted status can, under certain conditions, lift some of the ordinary limits on foreign ownership, and it also affects which business scope and land arrangements are open to you — so the correct order is to decide on promotion first and fix the entity form second, not the other way round.
• Leaving the quota until last. The company is registered, the people are ready to come, and only then does it turn out that the quota does not cover "a few engineers from head office stationed here long term".

What these four have in common is that every one of them can be asked and answered on a single sheet before registration. Done before registration, the cost is close to nothing. Done afterwards, it means amending the articles of association, or setting up a new entity altogether.

02What the worksheet compares

Four sheets:

• Entity comparison sheet: limited company, branch and representative office side by side, row by row — whether it can earn revenue, legal status and liability, tax treatment, how foreign ownership is counted, expatriate quota, and the route to change later. Every row ends with a column for "your company's situation".
• Decision path sheet: eight "ask yourself first" questions, in an order that cannot be reversed — describe the business clearly, then does it earn revenue, then does it touch the restriction lists, then do you go for promoted status, then is anyone stationed here long term, then fix the entity form and the capital, then where the regional functions sit, then registration and licensing. Each step feeds its conclusion into the next; doing it backwards almost always means redoing it.
• Red lines and consequences sheet: nominee shareholding, operating without a licence or outside scope, minimum capital requirements, the three kinds of business most often added to scope by habit (split into three rows so each is checked separately), representative office activity beyond scope, and treating a draft amendment that is not yet in force as the current rule. Article numbers and penalties are recorded as verified; where no definite provision or definite amount could be confirmed, the cell is marked "—" or left for a consultant to check, rather than filled with a figure that merely looks right.
• Selection backschedule sheet: nine steps from the business description to filing the registration, each with a slot for "internal due date" and "owner". It does not repeat the questions from the previous sheet; it only puts the answers you already have against dates and names, so it can be used as an internal control sheet as it stands.

03There is one criminal red line, and it is not negotiable

Putting shares in the name of a Thai friend or employee to "make up the Thai side percentage" is a criminal offence under Article 36 of the FBA: up to 3 years' imprisonment or a fine of THB 100,000 to 1 million, and the foreign party who knowingly goes along with it commits the offence as well. Directors can also be pursued personally. No structure proposal should contain a nominee arrangement.

Tied to that, the capital contribution has to stand up to inspection. A Thai shareholder with no real capacity to contribute, no trace of involvement in the business, and a dividend arrangement plainly out of line with the registered shareholding, is exactly the signal regulators and due diligence teams look for when screening for nominee structures. The FBA also sets a minimum capital requirement for foreign-owned operations; a breach carries a fine of THB 100,000 to 1 million plus a further daily fine of THB 10,000 to 50,000. Restricted businesses are subject to higher figures, but different sources do not agree on them, so the amount has to follow the text currently published by the Department of Business Development (DBD) — we have left that cell in the sheet without a figure, for a consultant to check.

One more cell is worth calling out on its own. In 2026 the Thai cabinet approved a draft amendment that would move several categories of business, including intra-group shared services, off the restriction lists, but it has not been gazetted and is not in force, so it cannot be used as the current rule. When you hear that things are about to open up, check first whether it has actually taken effect.

04How to use the sheet

Three steps. First, fill in only the decision path sheet, answering all eight questions in order — the ones you cannot answer are your real gaps right now. Second, go back to the comparison sheet, keep the rows that apply to you, and leave the "your company's situation" column empty for the moment. Third, point the nine steps of the selection backschedule at a person and a date, splitting "fix the entity form" and "go and register" into two separate actions.

The amber cells are deliberately blank, but only on the items that genuinely move with the individual case. General rules that are settled in public sources are filled in as normal. The expatriate quota conditions for each form, the specific contents of the permitted activity range for a representative office, and how a branch is taxed and how it remits profits all have to be verified item by item against the rules in force — put a template default in and the reader will very easily take it as a determination about their own company. This sheet is a working paper for you and a consultant to fill in together, not a set of answers.

Which form your business should take, whether you have restriction-list exposure and whether the quota is enough all have to be verified item by item against your specific business description, investment size and staffing plan. For the items you cannot tick off or cannot fill in, we suggest having our advisory team read through them before your company decides the order of handling.