Reduction of Government Fees

Thailand International Business Center Promotion: What are the allowed activities and what conditions must be fulfilled?

On 10 October 2018, the Thai Cabinet announced a new investment promotion category, called the International Business Center (IBC), which was published in The Royal Gazette on 28 December 2018, and became effective the next day.

This new promotion category replaces the International Headquarters (IHQ), Regional Operating Headquarters (ROH), International Trading Center (ITC), and Treasury Center (TC) promotion categories. Therefore, applications for ROHs, IHQs, or ITCs are no longer accepted. Starting with 29 December 2018 only applications for International Business Center (IBC) are accepted.

The measure to introduce a new tax regime was taken in response to the Organization for Economic Co-operation and Development’s (OECD) report that identified the above-mentioned tax regimes as constituting harmful tax practices.

International Business Center (IBC) Allowed Activities

Under the International Business Center (IBC) promotion, a promoted company must provide at least one of the following services to its related group companies located either in Thailand or overseas:

  • General management, business planning, and business coordination
  • Procurement of raw materials and parts
  • Research and development of products
  • Technical support
  • Marketing and sales promotion
  • Human resources and training
  • Financial advisory
  • Economic and investment analysis and research
  • Credit control and management
  • Treasury center
  • International trade activities
  • Any other services approved by the Thailand Revenue Department

Criteria of Eligibility

An applicant, wanting to perform the above-mentioned services, may apply for an International Business Center promotion with the Thailand Board of Investment and obtain an approval if the following conditions are fulfilled:

  • Be a company established under Thai law having a registered capital of at least 10 million THB
  • Have 10 or more skilled workers or experts. If the IBC is providing only treasury management services, 5 or more skilled workers or experts will be required.
  • Have a minimum investment capital of at least 1 million THB, excluding the cost of land and working capital
  • The international trade activity cannot be performed alone and the applicant must also perform at least one of the others activities listed above.

Separately, the applicant can apply for an International Business Center promotion with the Thailand Revenue Department. Besides the conditions mentioned for the IBC promotion under BOI, the applicant must have an annual operating expense in Thailand of at least 60 million THB. This condition does not apply to existing ROHs and IHQs planning to convert into IBCs.

The applicant must submit the IBC application to the Revenue Department, together with a business plan, a list of all related group companies located either in Thailand or overseas, and a list of all foreign nationals to be hired by the IBC.

International Business Center (IBC) Incentives

The successful applicant might be entitled to receive non-tax incentives if he files an IBC application with the BOI or may receive tax incentives if he files an IBC application with the Revenue Department.

BOI Incentives

The Board of Investment will offer non-tax incentives to successful IBC applicants, similar to those provided under the previous investment promotion categories, such as:

  • Permission for 100% foreign ownership of the company
  • Permission to hire foreign skilled workers, without considering the 4:1 Thai employee ratio
  • Permission to own land in Thailand for IBC activities
  • Exemption of import duty on machinery for R&D purposes and related testing
  • Permission to take out or remit money abroad in foreign currency

No merit-based incentives will be granted.

RD Incentives

Once the Director-General of the Revenue Department has granted an approval, the successful IBC applicant can enjoy the following tax incentives:

IBC tax incentives

These tax incentives will be offered for a period of 15 years, as long as the applicants remain in compliance with all the IBC conditions mentioned above.

If in one financial year, the IBC applicant doesn’t meet one of the conditions, he will not be entitled to tax incentives in that particular year. However, if the applicant fails to meet these conditions or remain in compliance therewith for more than one financial year consecutively, the IBC approval is subject to revocation and the applicant must pay all the granted tax incentives retroactively starting with year one.

Existing ROH, IHQ, ITC

The existing ROH, IHQ, and ITC companies that are currently receiving tax incentives under their respective investment promotion may continue benefitting from these incentives until their approval expires (which is up to 15 years for an IHQ/ITC) or until the end of 2020 for an ROH.

Furthermore, these companies have the possibility to either convert into IBCs by filing an application at RD or apply for another BOI promotion, without being penalized for such termination.

We will monitor the implementation of this new promotion and we will keep you updated.


We hope that the information provided was helpful to you. If you have any further questions, please do not hesitate to contact us. We will make sure that your question will be brought to the right person’s attention and we will deliver a prompt response.


The above information is intended to highlight an overview of key issues for ease of understanding and cannot substitute a personal consultation with a qualified lawyer. We highly advise you to read this update in conjunction with appropriate advice from your legal counsel to determine the legal implications this update might have on your business and how to mitigate exposures as much as possible.

Despite applying due care when selecting and producing the information published on this newsletter, we accept no liability in case such information is not accurate, up-to-date or complete.
Under no circumstances shall any company of the Antares Group or any of its directors, partners, lawyers or any other professionals be liable for any direct or indirect, incidental or consequential loss or damage that results from the use of or the reliance upon the information provided.