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IMPACT – HIGH
What is the change? Foreign nationals serving as company directors who do not have a Thai work permit will no longer be allowed to sign corporate income tax and financial statement documents.
What does the change mean? Work permit applications will be declined if they are supported by tax documents signed by a foreign national director who does not have a work permit.
Background: Thailand’s Employment Department found that, in some cases, foreign national company directors were signing corporate income tax and financial statements even though they did not hold a Thai work permit. This was a problem because “signing documents” is considered productive work in Thailand. Thai authorities have now made it clear that foreign nationals cannot sign company tax documents or financial statements without a work permit.
This new rule mostly affects companies with foreign nationals working as directors while residing outside of Thailand. In such instances, two options are available. First, corporate income tax and audited financial statements can be notarized by a notary public outside of Thailand and then legalized or authenticated at a Thai embassy or consulate in the country where they were notarized. Second, companies can enter into a power of attorney agreement that authorizes a Thai national within the company’s management to sign corporate income tax and audited financial statements in Thailand.
BAL Analysis: The added requirement may cause significant delays in completing new or renewal work permit applications for affected companies. Those who are affected by the change may contact BAL to discuss the options that are available.
This alert has been provided by the BAL Global Practice group and our network provider located in Thailand. For additional information, please contact your BAL attorney.
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About Berry Appleman & Leiden LLP Founded in 1980, Berry Appleman & Leiden (BAL) provides comprehensive global immigration services from seven offices across the U.S. and from offices in Geneva, London, Melbourne, Rio de Janeiro, São Paulo, Shanghai, Singapore and Sydney. BAL manages global visa matters and customized application approaches for work permits, business visas, and residence permits in more than 100 countries. With a single cost center for worldwide operations, BAL offers centralized management with regional and local support for the complete spectrum of global immigration matters.
Source: Berry Appleman & Leiden LLP
When traveling to Thailand, your nationality and the types of activities you will conduct during your trip will determine whether you may travel lawfully as a business visitor or if you require work authorization. Please seek advice from your immigration counsel if you are uncertain about the specific types of activities that constitute business or work.
As a business visitor to Thailand, you may engage in the activities below. While this list is not exhaustive and other activities could qualify as business, you may:
In general, foreign nationals seeking to travel to Thailand for business purposes should obtain a Non-Immigrant B Visa from a Thai Consulate or Embassy prior to arrival. Although visa-exempt nationals can generally perform business activities, the best practice is for visa-exempt nationals to apply for a Non-Immigrant B Visa to engage in business activities in Thailand. Please consult your immigration counsel before traveling to ensure compliance.
The activities below, whether paid or unpaid, generally constitute work under Thai law. This list is not exhaustive, and many other professional activities are considered work in Thailand, even if conducted for a short duration.
The requirements for work authorization depend on your qualifications and on the nature and duration of your work. The most common Thai work permits are:
There are no nationalities eligible for work authorization exemptions in Thailand.
Inevitably, the legal and strategic considerations impacting visa selection, as well as visa waiver and work authorization eligibility, entail the careful consideration of many factors. We recommend that you consult with your immigration counsel before taking any course of action.
IMPACT – MEDIUM
What is the change? The Employment Department has recently announced a shorter processing time for issuance of work permit booklets for foreign nationals who hold a “pre-work permit approval.”
What does the change mean? After a foreign employee arrives in Thailand and submits the pre-work permit approval to request a work permit booklet, the Employment Department will now complete the process within three to four business days (instead of seven business days).
Background: The Employment Department has implemented the change to improve the efficiency of their internal process, resulting in a faster turnaround time on work permit applications for those holding a pre-work permit approval. The pre-work permit approval is a document required of foreign nationals who need to obtain a Non-Immigrant B visa prior to travel to Thailand. Foreign nationals must submit the approval along with their medical certificate and passport upon arrival in Thailand in order to complete the work permit application process.
With the faster processing time, the Employment Department is requiring foreign employees to pick up their work permits within three business days from the date of issuance. Although the rule has not been officially announced, authorities have verbally indicated that foreign employees who do not collect their work permits on time could have their permits canceled.
BAL Analysis: The improved processing time for work permit applications that involve pre-work permit approvals will reduce overall wait times for foreign nationals who require the approval before seeking a work permit. It should be noted that applications submitted via the Board of Investment or One Stop Service Centre are not affected by this recent change.
What is the change? Thai immigration authorities are now requiring a new form called a “Record of Foreign Information” for certain applications. The purpose of the form is for foreigners to provide additional personal details about themselves.
What does the change mean? The form is required for foreigners applying for visa extensions or re-entry permits and when reporting stays of longer than 90 days.
Background: The government has indicated that it is requiring the form for national security reasons and in case of emergency. It must be lodged at the One Stop Service Center or Immigration Bureau.
BAL Analysis: The form must be submitted by each individual passport holder submitting an application and provides authorities with more details about foreign nationals in Thailand.
What is the change? Under new regulations that will take effect Sunday, foreigners who are apprehended in Thailand and are found to have overstayed their visas will face bans on re-entry.
What does the change mean? Those who have overstayed their visa by less than one year will be banned from returning to Thailand for five years; those who have overstayed by one year or more will be banned for 10 years.
Background: Currently, foreigners who overstay their visa for short periods may pay a fine at the airport, but are not banned from re-entry. The new regulation does not appear to allow for any grace period or exceptions for short overstays.
BAL Analysis: Foreign nationals should pay close attention to the duration of their visa, as an overstay of even one day could subject them to a ban on returning for five years.
What is the change? Under a new rule, foreign employees applying for long-term visa extensions through the One Stop Service Center must submit proof of payment of personal income taxes.
What does the change mean? New work permit applicants will no longer be able to file a long-term visa extension application concurrently because they must wait for their first month’s salary withholding tax to be paid.
Background: Previously, first-year foreign nationals filing at the One Stop Service Center could file for a new work permit and a long-term visa extension application at the same time.
This will no longer be possible. Applicants will have to wait for their employers’ monthly tax declaration to be certified following the applicants’ first salary payment in Thailand before being able to lodge the long-term visa extension application. The same requirement also applies to foreign nationals who are filing for renewal applications of their long-term visa extensions.
In addition to the visa applicant’s monthly salary withholding tax, employers will have to submit proof of monthly salary withholding tax for all foreign employees sponsored by the company, regardless of whether they hold a long-term work permit, short-term assignment work permit or project work permit.
Proof of tax payment must be made using one of the following official forms, based on whether the employee is on a local payroll:
The director of the company must also sign a form confirming the number of foreign national employees in the company. This form is available at the One Stop Service Center and must be submitted every time an employee lodges a renewal application.
BAL Analysis: The change in procedure will cause delays in obtaining long-term visa extensions and completing the formalities for new foreign employees in particular. Thai authorities anticipate that the new requirements will help prevent fraudulent filings by companies at the Service Centers and reduce incidents of foreign workers failing to pay Thai income taxes.
What is the change? Thailand has introduced an online filing option for foreigners who are required to report to the Immigration Bureau when their stays in Thailand exceed 90 days.
What does the change mean? Foreigners may file through the online portal, but can only do so during a limited period before their notification due date.
Specific Instructions: Foreign nationals must report their address to the Immigration Bureau if they stay for more than 90 days.
Foreign employees may now file online, but only during an eight-day period starting 15 days before their notification due date and no later than seven days before their notification due date. The notification due date is the date on which the foreign has stayed in Thailand continuously for 90 days. The portal will not accept reports during the last seven days before the notification due date because that is the period when decisions are processed. If their online filing is approved, foreigners must print out a receipt as proof and keep it in their passport in case they are stopped.
Foreign nationals opting to file in-person may continue to observe the longer period of reporting, starting 15 days before the notification due date and ending seven days after the notification due date.
BAL Analysis: The online reporting provides an option for foreign employees, but they should note the limited 8-day period during which they can do so. Foreign nationals may continue to send a representative to report for them in-person at the Immigration Bureau instead.
This alert has been provided by the BAL Global Practice group and our network provider located in Thailand for additional information, please contact your BAL attorney.
What is the change? Thailand has expanded its definitions of business activities that are exempt from work permits, including attendance at board meetings, conferences, seminars, lectures and other activities.
What does the change mean? Foreign nationals entering Thailand to perform any of the seven exempted activities listed below will no longer be required to obtain work permits or urgent work permits.
Background: As of March 13, the Employment Department began recognizing an expanded list of business activities it now considers “non-work” activities and thus do not require a work permit or urgent work permit.
The list of activities includes:
BAL Analysis: As this rule is newly implemented, clients are strongly advised to consult with their BAL representative to confirm that their activities fall within the list of permitted activities and to strictly limit their activities to those that are specifically listed. Companies and foreign travelers should take special note that while they are not required to obtain work permits for general business meetings, a foreigner who travels to Thailand to be a “trainer” or “speaker” for a conference or seminar must obtain a regular work permit or urgent work permit. Additionally, while individuals attending training sessions, seminars or conferences are not required to obtain work permits, foreign workers who will be trained at the company or work site must apply for work permits.
What is the change? As a fraud-prevention measure, Thailand has imposed stricter certification rules for numerous documents that are required in work permit applications at the One-Stop Service Center.
What does the change mean? Applicants must obtain certification of each document by the appropriate agency, adding time, expense and delays to the process.
Background: Under the new rules which take effect Jan. 19, Thailand’s One-Stop Service Center will no longer accept originals of the documents listed below. Instead, the agency that issues each document must certify it.
BAL Analysis: Employers should anticipate delays as it may take time to obtain certification from each government agency. Clients are encouraged to work with their BAL attorney as soon as possible to plan for the additional time, expense and inconvenience involved in meeting these new certification requirements.
What is the change? Thailand has distributed a form, “Acknowledgment of Penalties for a Visa Overstay,” which visitors must sign when they obtain or extend visas.
What does the change mean? Thailand is cracking down on foreigners who overstay their visas.
Background: The Immigration Bureau has begun a campaign to strictly enforce the nation’s immigration rules. Foreigners who obtain visas, visa extensions (Board of Investment and non-Board of Investment visa-holders), or who are making 90-day reports are now required to sign the “Acknowledgment of Penalties for a Visa Overstay” form, which requires name, nationality, passport number and signature.
Foreigners who overstay their visas by up to 90 days face fines. The Immigration Bureau is proposing that overstays of more than 90 days be punishable by re-entry bans ranging from one year to life, depending on the length of the overstay.
BAL Analysis: The new acknowledgement form and proposed penalties are a compliance reminder to companies and foreign assignees.