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Drive to amend Foreign Business Act revived

The Business Development Department will recommend that the government amend the Foreign Business Act (FBA) to promote a clearer and more business-friendly environment for investors in the Kingdom.

The department will also propose revisions to other business laws, such as the draft Franchise Act and the Logistics Act, to facilitate growth. The department plans to submit its proposals to the Cabinet late this month.

The Commerce Ministry unsuccessfully proposed amending the FBA during the government of Surayud Chulanont. The ministry has revived the proposal in a bid to achieve efficient regulation while boosting foreign direct investment.

“Amending the FBA is a delicate issue for the government, as any changes will have a direct impact on the Kingdom’s investment environment,” said Deputy Commerce Minister Siriwat Kachornprasart.

Many foreign investors have urged that the act be amended, parฌticularly the list of protected businesses, which has been in force since 1999.

Meanwhile, Business Development Department director-general Banyong Limprayoonwong predicted that the government’s policy to cut corporate tax from 30 per cent to 23 per cent next year would prompt a gradual increase in the number of newly registered companies.

Banyong said the tax cut would encourage businesses that have not yet registered with the department to enter the system. The department expects the number of newly registered companies to exceed 50,000 this year.

The department reported that the number of new businesses startฌing up grew in August after falling in July, as businesses foresee a period of political stability as the new government settles in, Siriwat said.

The number of new businesses in Thailand showed steady yearonyear growth in August, expanding by 5,014, or 12 per cent, from the same month in 2010. The figure grew by 5 per cent from July.

The firms’ combined initial investment capital was Bt45.54 billion last month, up 97 per cent year on year.

New businesses registered last month were mostly involved in construction, entertainment services and property development.

In the first eight months of the year, the number of new compaฌnies grew by 23 per cent to 41,295 firms, with combined initial investฌment capital of Bt239.39 billion, up 10 per cent year on year.

The number of companies that closed down jumped for the third consecutive month in August, because of the impact of flooding and the end of construction firms’ binding contracts. A total of 1,204 firms closed in the month, up 154 per cent year on year. In the first eight months of the year, 5,092 companies closed, up by 29 per cent over the same period last year.

The value of the businesses that closed increased by 114 per cent year on year in August to Bt9.77 billion.

Businesses with a total value of Bt30.57 billion closed down in the first eight months of this year, a jump of 79 per cent year on year.

Source: The Nation

ThaiVest Editorial Team

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