This BOI incentive scheme covers various types of activities from upstream, midstream to downstream as follows: Promoted upstream activities are, for instance, plant or animal breeding, an economic forest plantation, production of biological fertilizers, organic fertilizers, nano-coated organic chemical fertilizer, bio-pesticides, etc. Promoted mid-stream activities are, for instance, processing businesses and production of fuels from agricultural materials or products, etc. Promoted down-stream activities are, for instance, extraction of natural raw materials, production or preservation of food and beverages using modern technology.
In addition, the BOI promotes the products or services of modern farming systems or so-called “Smart Farming” systems which incorporate the design of systems and software to manage related resources by integrating the system into the farming process. The system will collect, analyze and interpret the data. The “Smart Farming” system also helps farmers reduce cost, optimize production processes, increase proceeds per area, upgrade production standards and control the production quality as markets demand. The yield of the proceeds derived from “Smart Farming” is, therefore, higher than on other regular farms.
In case farmers are categorized as SMEs, these farmers will fall under the BOI special investment promotion measure which is the“measure to increase the competitiveness of SMEs”. The BOI will ease certain conditions for SMEs. For example, the minimum required investment capital will be reduced to THB 500,000 (approx. 16,438 USD) instead of THB 1 million for regular promoted projects. The BOI also allows the usage of used machinery from Thailand with a value of less than THB 10 million. Promoted projects under this measure will receive a corporate income tax exemption of up to eight years with a corporate income tax exemption cap not exceeding 200 percent of the investment capital (BOI conditions applied).
Legal advice and support on foreign investment opportunities
PUGNATORIUS Ltd. is a Bangkok-based specialist provider of bespoke transactional legal and tax advice in the corporate and property legal and taxation industry sectors. The law firm provides comprehensive services to acquire farming land, to structure the farming business, to apply for licenses and BOI investment promotion and to guide foreign clients through regulatory hurdles and red-tape. It advises on the seven aspects of a superfood venture: (i) corporate structure, (ii) BOI promotion, (iii) commercial agreements, (iv) FDA licensing, (v) factory license, (vi) patents and other IP rights, and (vii) liability protection.
The focus of any foreign investment in Thailand’s farming industry should be on adding value and producing high-quality farm products. Digital technology, biotechnology, and physical technology have to be used to drive farm sector development, raising productivity both in terms of volume and quality for a variety of products. The law firm is the one-stop service point for agriculture, rubber tree and livestock investments in Thailand.
Disclaimer: A little knowledge is a dangerous thing. This low-resolution high-level outlook constitutes neither legal advice nor an attorney-client relationship.