The eligibility requirements for the Board of Investment (BOI) Promotion activities
One of the mechanisms for promoting investment in Thailand provided by Thai government is through the investment promotion. The government agency that is responsible for this investment promotion scheme is the Board of Investment (the “BOI”). The BOI specifies principles to promote investment projects that enhance Thailand’s competitiveness and achieve sustainable development in the long run.
If you want to find out about the application process for the BOI’s investment promotion, read our connected article!
Business sectors eligible to investment promotion in Thailand
The BOI’s policies pursuant to the BOI’s Announcement No. 2/2557 target the six key business sectors as follows:
- Promote investments that help to enhance the national competitiveness by encouraging R&D, innovation, value creation in the agricultural sector, industrial and services sectors, SMEs, fair competition, and an inclusive growth.
- Promote activities that are environment-friendly, save energy or use alternative energy to drive a balanced and sustainable growth.
- Promote clusters to create investment concentration in accordance with regional potentials and strengthen value chains.
- Promote investments in border provinces in Southern Thailand to help develop the local economy, which will support efforts to enhance security and safety in the area.
- Promote special economic development zones, especially in border regions, both inside and outside industrial estates, to create economic connectivity with neighbouring countries and to prepare and develop the entry into the ASEAN Economic Community (AEC).
- Promote Thai overseas investments to improve the competitiveness of Thai businesses and Thailand’s role in the global economy.
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Industries eligible for investment promotion in Thailand
Furthermore, the BOI’s Announcement No. 2/2557 and the BOI’s Announcement
No. Sor. 1/2560 also specify the activities that are eligible for investment promotion in eight sections, as follows:
1. Agriculture and Agricultural Products
Concentrating on the production of agricultural products and agricultural byproducts, with the primary requirements being the application of contemporary technology and the creation of environmentally sustainable projects.
2. Mining, Ceramics and Basic Metals
Focusing on mining of minerals and manufacturing of mineral and ceramic materials and steel under licensed requirements as a condition for certain projects.
3. Light Industry
Emphasizing the production of textile items, leather goods, sports gear, musical instruments, furniture, jewelry, toys, lenses, and medical equipment, with specific investment allocations for Research and Development in certain projects.
4. Metal Products, Machinery and Transport Equipment
Focusing on the manufacturing of metal products, multi-purpose engines, machinery, vehicles, automobile engines, trains, aircrafts, motorcycles including their parts and equipment, fuel cells, science equipment, heat treatment, building and repair of ships and the metal industry.
5. Electronic Industry and Electric Appliances
Focusing on manufacturing of electrical products and parts, electronic products and parts, and microelectronics, software industry, and E-commerce. The manufacturing process of certain projects shall be screened by the BOI as a criterion.
6. Chemicals, Paper and Plastics
Focusing on manufacturing of industrial and eco-friendly chemicals, petrochemicals, specialty polymers or chemicals, plastic products for industrial goods, plastic packaging, plastic products from re-cycled plastic, medicine, chemical fundamental fertilizers, and pulp or paper, production of pharmaceutical ingredients and printed matter, and oil refinery projects.
7. Services and Public Utilities
Concentrating on public services and infrastructure, natural gas facilities, extensive transportation systems, logistics hubs, International Headquarters (IHQs), International Trading Centers (ITCs), Trade and Investment Support Offices (TISOs), Energy Service Companies (ESCOs), industrial real estate development, cloud services, research and development, biotechnology, engineering design, scientific laboratories, calibration services, product sterilization services, recycling and waste treatment projects, vocational training centers, Thai film production, motion picture support services, tourism services, and activities that bolster tourism.
8. Development of Technology and Innovation
Focusing on core technology development for biotechnology, nanotechnology, advanced material technology, and digital technology development.
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Further details and considerations on the incentives
The stated activities will be promoted with activities-based incentives. Various conditions and criteria still apply to receive investment promotions depending on the details of each project. The incentives are divided into tax-incentives and non-tax incentives subject to the project appreciation by the BOI. All types of projects are eligible to grants of non-tax incentives and often represent substantial support such as right to own land for the operation of the project and the right to bring in foreign experts to work.
The projects may receive additional merit-based incentives if the project fulfil criteria relating to enhanced competitiveness, decentralization, and the development of industrial areas.
