Unofficial Translation INVESTMENT PROMOTION ACT, B.E. 2520 (1977) 1 His Majesty King Bhumibol Adulyadej Given on 29 April B.E. 2520 Being the 32 nd year of the Present Reign His Majesty King Bhumibol Adulyadej is graciously pleased to proclaim that: Whereas it is expedient to revise the law on promotion of investment; Be it, therefore, enacted by the King, by and with advice and consent of the National Administrative Reform Assembly as follows: Section 1. This Act is called the Investment Promotion Act, B.E. 2520 Section 2. This Act shall come into force on the day following the date of its publication in the Royal Thai Government Gazette. 2 Section 3. The following are hereby repealed: (1) Announcement of the Revolutionary Council No. 31 dated 29 November B.E. 2501; and (2) Announcement of the Revolutionary Council No. 227, dated 18 October B.E. 2515. 1 Translated by Ms. Sukpuck Phongsathit under contract for the Office of the Council of State of Thailand's Law for ASEAN project.- Initial version- pending review and approval. 2 Published in the Government Gazette, Volume 94, Part 3, Special Issue, Page 1, dated 4 th May B.E. 2520 (1977)
2 All other laws, rules, and regulations in so far as dealing with matters governed by this Act, or being contrary to or inconsistent with the provisions of this Act, shall be replaced by this Act. Section 4. In this Act, Applicant shall refer to an individual who applies for investment promotion under this Act; Promoted person shall refer to an applicant who is granted promotion certificate under this Act; Machinery shall refer to machinery necessary for uses in promoted business undertakings and for construction of factories, including component parts, equipment, tools, implements, and pre-fabricated factory structures to be assembled as factories; Board shall refer to the Board of Investment; Member shall refer to a member of the Board of Investment, including also a Chairman and a Vice Chairman of the Board of Investment; Advisor shall refer to an advisor to the Board of Investment; Secretary General shall refer to a Secretary General of the Board of Investment; Office shall refer to the Office of the Board of Investment; Competent official shall mean an individual appointed by the Minister of Industry to execute this Act. Section 5. The Minister of Industry shall take charge of this Act and shall have the power to appoint competent officials to execute this Act. Chapter 1 Board, Advisors and Competent Officials Section 6. There shall be a Board of Investment, consisting of the Prime Minister as Chairman, the Minister of Industry as Vice Chairman, not more than ten other
3 competent individuals appointed by the Prime Minister to act as members, and the Secretary General as member and secretary to the Board, having the powers and duties in accordance with this Act. The Prime Minister may appoint not more than five other competent individuals to act as advisors. Section 7. Members or advisors shall serve for a term of two years. In case an appointment of a memberor an advisor is made, either as an addition or as a replacement, while the term of office of a member or an advisor already appointed is valid, the person so appointed shall hold office only for the remaining term of his predecessor. A member or an advisor whose term of office is expired may be reappointed. Section 8. Apart from the expiration of term of office as specified in Section 7 paragraph one, a member or an advisor vacates his or her office upon: (1) death; (2) resignation; (3) dismissal by the Prime Minister; (4) being adjudged bankrupt; (5) being adjudged incompetent or quasi-incompetent; or (6) being imprisoned by a final judgment to imprisonment, except for a petty offence or an offence committed by negligence. Whenever a member or an advisor vacates his or her office under paragraph one, the Prime Minister may appoint other person to fill the vacancy. Section 9. The Chairman of the Board shall call a Board meeting. An attendance of not less than one-half of the total number of members of the Board shall be required to constitute a quorum for a Board meeting. The Chairman of the Board shall preside over a Board meeting. If the Chairman is absent from or unable to attend the meeting, the Vice Chairman shall preside over the
4 meeting. If the Vice Chairman is absent from or unable to attend the meeting, the members present shall elect one of the members to preside over the meeting. A decision of the meeting shall be taken by a majority of votes. Each member shall have one vote. In case of an equality of votes, the person who presides over the meeting shall cast another vote as a deciding-vote. Section 10. In case the Chairman of the Board is unable to perform his duties, the Vice Chairman shall act on his behalf. If the Chairman and the Vice Chairman of the Board are unable to perform their duties, the Secretary General shall convene a Board meeting in order to elect one member to be an Acting Chairman of the Board. Section 11. In executing duties under this Act, the Board may authorize the Office to act on its behalf; set up sub-committees to perform assigned duties; or summon any person concerned to give facts, explanations, advice or opinions. The provisions of Section 9 shall apply mutatis mutandis to meetings of the sub-committees. Upon completion of the assigned duties under paragraph one, the Office or the sub-committees, as the case may be, shall summit a report to the Board. Section 12. Members, advisors and members of sub-committees shall be entitled to receive remuneration as prescribed by the Council of Ministers. Section 13. The Office shall be administered by the Secretary General, who is the chief of its civil servants and shall be responsible for carrying out the civil service and report directly to the Minister of Industry. There shall be Deputy Secretary General(s) to assist the Secretary General in giving orders and carrying out the civil service. There may also be an Assistant Secretary General to assist the Secretary General in giving orders and carrying out the civil service. The Secretary General, Deputy Secretary General(s) and Assistant Secretary General shall be ordinary civil servants. The Office shall have powers and duties as follows:
5 (1) to implement resolutions of the Board or perform functions assigned to it by the Board; (2) to publicize investment potentials and induce investments in business undertakings that are important and beneficial to the economy, social and security of the country; (3) to establish an Investment Service Centre to assist prospective investors and investors in obtaining permissions and to provide service relevant to investment, including facilitation and assistance to prospective investors in preparation of investment projects, search of joint-ventures, and implementation of investment projects; (4) to appraise projects applying for investment promotion, to supervise and control, as well as evaluate already promoted investment projects; (5) to conduct feasibility studies and researches to identify investment opportunities, prepare feasibility reports, and formulate investment promotion programs; (6) to study and compile data relating to investment within the Kingdom; (7) to perform other duties in accordance with the purposes of this Act. Section 14. An authorized competent official shall be able to enter premises of an applicant and promoted person during working hours to make inquiry of facts from any person in those premises, or to examine any documents or objects relevant to his or her business undertaking on which the promotion is being sought or has been granted, as may be necessary. When the competent official intends to enter the premises as referred to in paragraph one, in case of non-urgency, he or she shall notify the applicant or promoted person in writing at a reasonable time in advance. Section 15. In executing duties under Section 14, the competent official must display his or her identity card to relevant persons.
6 Chapter 2 Applying for and Granting of Promotion Section 16. Business undertakings eligible for investment promotion granted by the Board shall be those which are important and beneficial to the economy, social, and security of the country; involve production for export; have high content of capital, labour or services; or utilize agricultural produces or natural resources as raw materials, and where the Board deems that those business undertakings are non-existent, or inadequate in the Kingdom or using out-of-date production processes. The Board shall make an announcement specifying types and sizes of business undertakings eligible for investment promotion. It may also stipulate therein conditions for granting the promotionas well as amend or revoke those conditions at any time. In case the Board deems that any business undertaking previously announced as eligible for the investment promotion under paragraph two is no longer necessary to be granted the investment promotion, it may announce a temporary or permanent cancellation of investment promotion for that business undertaking. Section 17. Any person seeking to be a promoted person shall, in accordance with rules, procedures and forms prescribed by the Secretary General, file an application for the promotion, together with investment project for which the promotion is being sought, to the Office. The promoted person shall be a company, foundation, or co-operative established in accordance with the respective laws. Application for the promotion prior to formation of a company, foundation, or co-operative under paragraph two shall be made in accordance with rules, procedure and forms prescribed by the Secretary General. Section 18. Investment projects, to which the Board may grant the promotion, must be economically and technologically sound. In this regard, consideration shall be given to:
7 (1) existing number of producers and production capacity in the Kingdom, in comparison with demand estimates and size of production capacity to be created or increased; (2) opportunities of those business undertakings to expand their market for products or commodities produced or assembled in the Kingdom and to boost production or assembly in the Kingdom; (3) quantity and proportion of usage of resources, including capital, raw or essential materials and labour or other services available in the Kingdom; (4) amount of foreign currency which may be saved or reserved for, and remitted into the Kingdom; (5) suitability of production or assembly processes; (6) other criterions deems necessary and appropriate by the Board. Section 19. Investment projects, to which the Board may grant the promotion, shall be those which incorporate appropriate measures to prevent and control harmful effects on environmental quality, for the benefits of livelihood of the public and sustenance of human-being and nature. Section 20. Where the Board deems appropriate to grant the promotion to any applicant, it may also stipulate conditions on the promotion certificates for that promoted person to carry out, which may be one or more of the following: (1) amount and sources of capital; (2) nationality and number of shareholders; (3) size of business undertakings, including types of products, commodities or services, production or assembly processes and capacity thereof; (4) amount of domestic raw materials to be utilized; (5) nationality and number of workers, technicians and experts; (6) training and employment of manpower; (7) prevention and control of harmful effects to the environmental quality; (8) period of time to commence implementation of the promoted project; (9) period of time to place purchasing orders of machinery;
8 (10) period of time to import machinery into the Kingdom; (11) period of time to re-export the imported machinery after the completion of their use; (12) extension of time limits under (8), (9), (10) or (11); (13) opening date of operation; (14) report on implementation of the project and operation; (15) report on trainings for Thai personnel by foreign technicians and experts; (16) requirements on products or commodities produced, assembled or exported to be conformed with standards prescribed either by the Board or other government agencies; (17) distribution of products or commodities produced or assembled, or services rendered; (18) export of products or commodities produced or assembled; (19) requirements to deposit cash, letters of guaranteeof Thai Government securities banks, or other securities, as deemed appropriate by the Board, with the Office as guarantee for compliance with conditions stipulated by the Board; (20) other matters on facilitating the competent officials, granting of, exercising, or controlling of the exercise of rights and benefits under this Act. Section 21. When the Board resolves to grant a promotion to any applicant, the Office shall send to that person a written notification of the Board resolution, together with conditions stipulated by the Board, within fifteen days from the resolution date. If the applicant accepts the promotion as referred to in paragraph one, he or she shall send a written confirmation to the Office within one month from the date of receipt of the notification. Where there are suitable grounds, the Secretary General shall have the power to extend the length of time referred to in paragraph two for not more than three times and not longer than one month at a time. Section 22. The applicant who accepts the promotion under Section 21 shall, in accordance with forms and procedures prescribed by the Secretary General, send a report
9 on commencement of the promoted project to the Office within six months from the date of acceptance of the promotion. Where there are suitable grounds, the Secretary General shall have the power to extend the length of time referred to in paragraph one for not more than three times and not longer than four months at a time, and shall send a report to the Board accordingly every time the extension is granted. When the Secretary General deems that the applicant is able to implement the promoted project, he or she shall issue a promotion certificate to that applicant without delay. Section 23. A promotion certificate shall be in accordance with the form specified by the Board. The Secretary General shall sign the promotion certificate. Any amendment to the promotion certificate shall be made by a resolution of the Board. The Secretary General shall sign the amended promotion certificate and deliver it to the promoted person without delay. Chapter 3 Rights and Benefits Section 24. Subject to the law on immigration, only in so far as not provided otherwise herein, the Board shall have the power to permit foreign nationals to entry into the Kingdom to undertake investment feasibility studies or perform any other acts that will benefit the investment, within the permitted period of stay in the Kingdom as deemed appropriate by the Board. An application for such permission shall be in accordance with rules, procedures and forms prescribed by the Board. The Board, upon granting the permission, may stipulate conditions as deemed appropriate.
10 Section 25. Subject to the law on immigration, only in so far as not provided otherwise herein, a promoted person shall be permitted to bring foreign nationals who are: (1) skilled workers; (2) experts; (3) spouses and dependents of persons in (1) and (2) into the Kingdom in the numbers and for the permitted period of stay in the Kingdom as deemed appropriate by the Board, even if in excess of the quotas or period of stay in the Kingdom permitted under the law on immigration. Section 26. Subject to the law on working of aliens, only in so far as not provided otherwise herein, foreign nationals granted permission under Section 24 and those being skilled workers or experts who are permitted to stay in the Kingdom under Section 25, shall be allowed to work in specific positions approved by the Board, for the entire permitted period of stay in the Kingdom. Section 27. A promoted person shall be permitted to own land for operation of promoted business undertakings in the amount as deemed appropriate by the Board, even if in excess of permissible limits under other laws. In case the promoted person being a foreign national under the Land Code dissolves his or her promoted business undertaking or transfers it to another person, he or she must dispose of the owned land within one year from the date of the dissolution or transfer. Otherwise the Director General of the Land Department shall have the power to dispose of the land in accordance with the Land Code. Section 28. A promoted person shall be exempted from import duties on machinery as approved by the Board, providing that the machinery must not be those being produced or able to be assembled within the Kingdom, having quality comparable to the types produced in other countries and having sufficient quantity to be acquired for relevant usages.
11 Paragraph two 3 (abolished) [the words and/or commercial tax was deleted by Section 4 of the Investment Promotion Act (No. 2) B.E. 2534] Section 29. If the Board deems that it is inappropriate to grant rights and benefits under Section 28 on the promotion of certain business undertakings or applicants, the Board may grant the promotion to those business undertakings or applicants, including those following in the future, with a one-half reduction or non-reduction on the import duties on machinery. [the words and/or commercial tax was deleted by Section 4 of the Investment Promotion Act (No. 2) B.E. 2534] Section 30. Where there are suitable grounds, the Board may grant a promoted person, for a period of not more than one year at a time from the date specified by the Board, a reduction of import duties not exceeding ninety percent of the regular rates that are imposed on raw or essential materials imported into the Kingdom for the production, mixing, or assembling in the promoted business undertakings, provided that those raw or essential materials must not be those being produced or originated within the Kingdom, having quality comparable to the types being imported into the Kingdom and having sufficient quantity to be acquired for usages. Paragraph two 4 (abolished) The foregoing shall be in accordance with types, quantities, length of time, conditions and procedures as prescribed by the Board. [the words and/or commercial tax was deleted by Section 4 of the Investment Promotion Act (No. 2) B.E. 2534] 3 Section 28 paragraph two was abolished by the Investment Promotion Act (No. 2) B.E. 2534 4 Section 30 paragraph two was abolished by the Investment Promotion Act (No. 2) B.E. 2534
12 Section 31 5. A promoted person, for no longer than eight years from the date on which income is first earned, shall be exempted from corporate income tax on the net profits derived from promoted business undertakings as specified in an announcement of the Board, considering on the proportion of investment capital excluding costs of land and revolving funds. For the business undertakings having special importance and benefits to the country as prescribed by an announcement of the Board, promoted persons in those business undertakings shall be exempted from corporate income tax on the net profits derived from those promoted business undertakings for a period as specified by the Board but not longer than eight years from the date on which income is first earned. The income to be calculated for the net profits derived from the business undertakings referred to in paragraph one or two, as the case may be, shall include income from the sale of by-products and semi-manufactured products as deemed appropriate by the Board. In case a loss is incurred during the period of corporate income tax exemption referred to in paragraph one or two, as the case may be, the Board may allow the promoted person to deduct such annual loss from the net profits accrued after the expiration of the corporate income tax exemption, for a period of not more than five years from the expiry date of that period. The promoted person may choose to deduct the loss from the net profits of any one or several years. Calculation of the investment capital referred to in paragraph one shall be in accordance with rules and procedures prescribed by an announcement of the Board. Section 32. In case the Board deems that it is inappropriate to grant the exemption of corporate income tax under Section 31 on the promotion of certain business undertakings or applicants, the Board may grant the promotion to those business undertakings or applicants, including those following in the future, without granting exemption of corporate income tax. 5 Section 31 was amended by the Investment Promotion Action (No.3) B.E. 2544
13 Section 33. Fees on goodwill, copyrights or other rights of the promoted persons pursuant to a contract approved by the Board shall, in accordance with rules and procedures prescribed by the Board, be excluded from calculation of taxable income for a period of five years from the date the promoted person first earns the income from the promoted business undertakings. Section 34. Dividends derived from the promoted business undertakings being exempted from corporate income tax under Section 31 shall be excluded from calculation of taxable income throughout the entire period of that tax exemption. Section 35 6. In order to promote investment in certain locations or zones, the Board may designate, by publication in the Royal Thai Government Gazette, such locations or zones as Investment Promotion Zones. In addition to the rights and benefits under other sections herein, the Board shall have the power to grant promoted persons operating promoted business undertakings in the locations or zones referred to in paragraph one, the following one or more special rights and benefits: (1) A fifty percent reduction of the regular rate of corporate income tax on the net profits derived from the investment for a period of not more than five years from the expiry date of that referred to Section 31 paragraph one or two, or from the date on which income is first earned from the promoted business undertakings, in case the promoted person is not exempted from corporate income tax; (2) Subject to conditions, procedures and period of time as prescribed by the Board, permission to deduct, for the purpose of calculating corporate income tax, an amount double the costs of transportation, electricity and water supply spent by the promoted person as operating expenses of the promoted business undertakings; (3) Permission to deduct from the net profits an amount not exceeding twenty-five percent of investment costs spent on installation or construction of facilities used in the promoted business undertakings in accordance with the rules prescribed by the Board. In this case, the promoted person may, in addition to the regular deduction of 6 Section 35 was amended by the Investment Promotion Action (No.3) B.E. 2544
14 depreciation costs, choose to make such deduction from the net profits of any one or several years within ten years from the date on which income is first earned. Section 36 7. In order to promote exports, the Board may grant promoted persons the following one or more special rights and benefits: (1) exemption of import duties on raw and essential materials imported for using, producing, mixing, or assembling products or commodities exclusively for export; (2) exemption of import duties on items which a promoted person imports for re-export; (3) exemption of export duties on products or commodities which a promoted person produces or assembles; (4) permission to deduct from the taxable corporate income in an amount equivalent to five percent of an increase in income over the previous year from the export of products or commodities produced or assembled by a promoted person, excluding costs of insurance and foreign freight. The foregoing shall be in accordance with conditions, procedures and period of time as prescribed by the Board. Section 37. A promoted person or an investor investing in promoted business undertakings and having domicile outside the Kingdom, shall be allowed to bring or remit foreign currencies abroad if they represents: (1) investment capital that the promoted person brings into the Kingdom and dividends or other returns derived from such capital; (2) foreign loan, including the interest thereon, that the promoted person brings into the Kingdom to invest in promoted business undertakings, pursuant to an agreement approved by the Board; (3) money that the promoted person has commitments with foreign country, pursuant to a license and services agreement, having approved by the Board, for promoted business undertakings. 7 Section 36 was amended by the Investment Promotion Action (No. 2) B.E. 2534
15 During any period of an adverse balance of payments which requires preservation of foreign currencies at an appropriate level, the Bank of Thailand may temporarily restrict the bringing or remittance of those currencies abroad, but may not restrict an inbound remittance of less than twenty percent per annum of investment capital brought into the Kingdom, provided that such remittance is made two years after the capital is brought in, and may not restrict remittance of less than fifteen percent per annum of dividends derived from the capital brought into the Kingdom. Chapter 4 Machinery, Raw and Essential Materials Section 38. The Board shall have the power to notify the Customs Department to release to an applicant who accepts of the promotion in accordance with Section 21 or to a promoted person, as the case may be, all machinery, raw or essential materials ordered or imported into the Kingdom and entitled to exemption or reduction of import duties under this Act, by regarding a bank guarantee issued by a commercial bank in the Kingdom as a cash deposit against payment of import duties. [the words and/or commercial tax was deleted by Section 4 of the Investment Promotion Act (No. 2) B.E. 2534] Section 39. In case a promoted person is unable to comply with the conditions relating to the import of machinery or the exemption or reduction of import duties on machinery as specified in a promotion certificate and the Board deems that there are suitable grounds to amend those conditions, the Board shall have the power to amend those conditions. If the machinery is legally imported at a later stage, in accordance with law on customs, the Board may make those amendments retroactive to the date of the import regardless of whether the import is made before or after the enforcement date of this Act. [the words and/or commercial tax was deleted by Section 4 of the Investment Promotion Act (No. 2) B.E. 2534]
16 Section 40. Within the period specified by the Board, which shall not be less than five and not more than fifteen years, a promoted person is prohibited to: (1) use the machinery having granted exemption or reduction of import duties for any purposes other than for the promoted business undertakings of the promoted person, or consent to any other person to use those machinery; (2) move the factory or place of operation to or operate in any location other than those specified in the promotion certificate, except in cases where permission is granted by the Board under Section 41. Section 41. The Board shall have the power to permit a promoted person to mortgage, sell, transfer, lease and use for other purposes, or to allow other persons to use the machinery having granted exemption or reduction of taxes or duties under Section 28 or Section 29, or to move the factory or place of operation to or operate at other location. The permission may be made in writing or by amending the promotion certificate, specifying also conditions and details of such permission therein. The law on customs tariffs shall not apply to the promoted person receiving such permission from the Board under this Section, unless specified otherwise by the Board. In the latter case, the law on customs tariffs shall apply only in so far as it is not contrary thereto or inconsistent therewith. Section 42. In case a promoted person mortgages the machinery having granted exemption or reduction of taxes and duties, and a mortgagee who is not a promoted person forecloses the mortgage on those machinery before the expiration of the period prescribed by the Board under Section 40, the law on customs tariffs shall apply to the mortgagee as if he or she is an importer of those items, who ceases to be entitled to the exemption or reduction of taxes and duties on the machinery from the date of transfer.
17 Chapter 5 Guarantees and Protection Section 43. The State shall not nationalize the business undertakings of the promoted person. Section 44. The State shall not set up new business undertakings in competition with the promoted person. Section 45. The State shall not monopolize the sale of products or commodities of the same kind as, or similar to those produced or assembled by the promoted person. Section 46. The State shall not impose price controls on products or commodities of the promoted business undertakings, except in case of necessity for the economy, social and security of the country. In no case shall the controlled prices be lower than those which deemed appropriate by the Board. Section 47. The promoted person shall be granted permission to export at all times products or commodities of the promoted business undertakings, except in case of necessity for the economy, social and security of the country. Section 48. The State shall not allow any government agency, government organization or state enterprise import, with exemption on import duties, products or commodities that Board deems as being the same types as those produced or assembled by the promoted person, having quality comparable, and having sufficient quantity to be acquired for uses. The provision of paragraph one shall not apply to weaponry under the law on control of weaponry imported for the use in the civil service of the Ministry of Defense. [the words and/or commercial tax was deleted by Section 4 of the Investment Promotion Act (No. 2) B.E. 2534]
18 Section 49. When it is necessary to protect business undertakings of the promoted person, the Board shall have the power to impose special fees, at an appropriate rate but not exceeding fifty percent of the prices inclusive of the insurance and foreign freight of such products or commodities, for the import into the Kingdom of products or commodities of the same kind as, similar to, or substitutable with those produced or assembled by the promoted person. The imposition of the special fees under paragraph one shall be announced in the Royal Thai Government Gazette and shall be effective for a period as specified by the Board, but not more than one year at a time from the day following the date of its publication in the Royal Thai Government Gazette. The Board shall have the power to publish in the Royal Thai Government Gazette, amend or revoke announcements made under this Section at any time it deems appropriate. Where a question arises on which and whether or not imported products or commodities are subject to the special fees in accordance with an announcement of the Board, the Board shall be an authorized entity to consider the matter and its decision shall be final. Collection of special fees for the import under this Section shall be under the authority of the Customs Department. The law on customs shall apply mutatis mutandis and such special fees for the import are to be regarded as import duties in accordance with the law on customs tariffs. Where the Board decides that such products or commodities are not subject to the special fees and if any person has paid the special fees for those items, the Customs Department shall refund the fees to that person. Section 50. Where the Board deems that imposition of the special fees under Section 49 is inadequate for protection of business undertakings of promoted persons, the Ministry of Commerce shall prohibit an import into the Kingdom of products or commodities of the same kind as, similar to, or substitutable with those produced or assembled by the promoted person in accordance with the law on export and import control of certain goods.
19 Section 51. In case a promoted person encounters problems or obstacles in operating the promoted business undertakings and request assistance from the Board, the Chairman of the Board shall have the power to authorize assistance as appropriate or to instruct relevant government agency, government organization, or state enterprise to render assistance without delay. Section 52. Where structure, rates, or procedures for collection of taxes and duties, service charges or fees are obstacles to promotable or promoted investments, irrespective of whether a request for assistance from the Board is made, the Chairman of the Board shall have the power to instruct relevant government agency, government organization, or state enterprise to consider taking remedial actions. Section 53. Any government agency, government organization or state enterprise which receives the instruction from the Chairman of the Board under Section 51 or Section 52 shall consider render assistance or make amendment in line with the instruction. If any of those agencies deem impossible to implement the instruction, it shall send a report to the Chairman of the Board together with reasons within fifteen days from the date of receipt of the notification. Upon receiving the report of reasons referred to in paragraph one, if the Chairman of the Board deems appropriate to take any action, such decision shall be final and the relevant government agency, government organization or state enterprise shall implement those actions without delay. Chapter 6 Withdrawal of Rights and Benefits Section 54. Where a promoted person violates or fails to comply with the conditions stipulated by the Board, the Board shall have the power to withdraw the rights and benefits, in whole or in part, granted to that promoted person and may also prescribe length of time thereof.
20 If the Board deems that such violation or failure to comply with the conditions by the promoted person is unintentional, the Board may instruct the Office to send a written warning to the promoted person to make corrections or comply with the conditions within a specified period first. If, after the expiration of such period, the promoted person fails to make corrections or comply with conditions without reasonable justification, the Board shall take actions as specified in paragraph one. Section 55. In case the Board withdraws, in whole, the rights and benefits relating to import or export taxes and duties, that promoted person shall be regarded as never been granted exemption or reduction of taxes and duties from the beginning and shall pay taxes and duties, which shall be calculated based on the condition of prices of the items and using the rates of taxes and duties existing on the date of the import or export. In case of having granted reduction of taxes and duties, the promoted person shall pay the outstanding balance of the full amount of payable taxes and duties. In case the Board withdraws, in part, the rights and benefits relating to import or export taxes and duties, that promoted person shall be regarded as having granted exemption or reduction of taxes and duties from the beginning in so far as to the extent that he or she remains entitled to, and shall pay in full taxes and duties in the amount withdrawn, which shall be calculated based on the condition of prices of the items and using the rates of taxes and duties existing on the date of the import or export The promoted person shall, within one month from the date of receipt of the order on withdrawal of rights and benefits on taxes and duties, contact the Customs Department or Customs Posts, where the import or export of those items takes place, to notify payment of taxes and duties. He or shall, within one month from the date of receipt of a notification on the payable amount, complete payment of the taxes and duties at a customs office designated by the Customs Department. If the promoted person fails to contact or pay those taxes and duties within the specified period, he or she shall pay a surcharge at the rate, not on a compound basis, of one percent per month of the payable amount of taxes and duties, from the expiration of the notification or payment date, as the case may be, until the day that those taxes and duties as well as surcharges have been paid up, which must not exceed three months from those expiry dates. In case of non-performance,
21 those items shall be regarded as being imported or exported by means of evasion of taxes and duties, in which case the law on customs shall apply. For the purpose of calculation of surcharges, a fraction of one month shall be counted as one month 8. Where the promoted person fails to comply with the warning of the Office under Section 54 paragraph two, the Board may also require the promoted person to pay a surcharge to the State through the Customs Department, together with the taxes and duties or additional taxes and duties payable under paragraph three, at the rate of one percent per month of the amount payable, from the expiry date of the period specified under Section 54 paragraph two. The amount of surcharge under this Section shall not exceed the payable amount of taxes and duties or additional taxes and duties; and in order to enforce the payment of surcharge, the surcharge shall be regarded as duties payable under the law on customs. For the benefits of legal proceeding, calculation of the state of limitation under this Section shall commence one month after the date of receipt of the withdrawal order. Section 55/1 9. Where the Board withdraws the rights and benefits on corporate income tax, the promoted person shall cease to be entitled to the exemption or reduction of corporate income tax for the accounting period on which the rights and benefits are withdrawn, and the Revenue Code shall apply thereto. The Board may make the withdrawal order of the rights and benefits on corporate income tax retroactive to an accounting period during which the promoted person violates or fails to comply with the conditions stipulated by the Board. In this case, the promoted person shall, within one month from the date of receipt of the withdrawal order, contact and complete the tax payment, which shall be calculated based on the rate existing during the accounting period having granted exemption or reduction, at the Revenue Department or Regional Revenue Office or Provincial Revenue Office, where his or her main office is located. If the promoted person fails to contact and complete the payment of tax 8 Section 55 paragraph three was amended by the Investment Promotion Action (No. 3) B.E. 2544 9 Section 55/1 was added by the Investment Promotion Act (No. 3) B.E. 2544
22 and additional tax within the specified period, the promoted person shall pay a surcharge in accordance with the Revenue Code, from the expiration of the notification and payment dates until the day those taxes as well as the surcharge have been paid up. In case of nonperformance, the Revenue Code shall apply thereto. The order on withdrawal of the rights and benefits on corporate income tax under paragraph two shall not affect dividends derived from the promoted business undertakings, which have been paid prior to the date of issuing the order. Section 56. Where the promoted person dissolves his or her business undertakings, enters a joint-venture, or transfers the business undertakings to other persons, the promotion certificate shall be valid for a period of not more than three months from the date of dissolution, joint-venture or transfer. Where a person operating a new joint venture or being a transferee of the business undertakings, wishes to continue operation of those promoted business undertakings under the conditions stipulated in the promotion certificate, he or she shall file an application for the promotion within the period specified in paragraph one. If the Board deems it appropriate to grant the promotion, a promotion certificate shall be issued with rights and benefits granted under this Act for the remaining period entitled by the original promoted person. If the Board deems it inappropriate to grant the promotion, it shall issue an order to withdraw all rights and benefits. Chapter 7 Final Provisions Section 57. All powers and duties vested in the Board of Investment under the Announcement of the Revolutionary Council No. 227 dated 18 October B.E. 2515 implementing of the Announcement of the Revolutionary Council No. 328, dated 13 December B.E. 2515, shall be the powers and duties of the Board under this Act.
23 Section 58. A person receiving the promotion certificate to operate industrial undertakings in accordance with categories, sizes and conditions as stipulated by Ministerial Regulations or Announcements of the Board of Industrial Investment under the law on promotion of industrial investment and a person already receiving the promotion certificate in accordance with the Announcement of the Revolutionary Council No. 227 dated 18 October B.E. 2515 on the date of entry into force of this Act, shall be deemed a promoted person under this Act and shall continue to enjoy rights and benefits under the conditions stipulated in the promotion certificate and shall also have the right to apply for rights and benefits under this Act. Section 59. Applications for the promotion, that have been approved for the promotion by the Board in accordance with the Announcement of the Revolutionary Council No. 227 dated 18 October B.E. 2515, shall be deemed as the approved applications for the investment promotion by the Board under this Act. Section 60. Applications for the promotion, that are currently pending consideration on the date of entry into force of this Act, shall be deemed as applications being filed under this Act. Countersigned by Thanin Kraivixien Prime Minister