Thailand Treaty of Amity

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There has been much discussion about the Treaty of Amity between the United States and Thailand over the past 2 years. The reason being that under WTO rules you are not permitted to favour one country over another. Speak to a lawyer about what is still applicable and how in Thailand with regards to this treaty!

As of writing there have just been talk of the status of the treaty however there have not been any legal changes as yet. With much speculation and rumours, it is always best to speak to an attorney with regards to buying property or setting up a business under the US Treaty of Amity . Under this treaty American citizens are allowed to buy a property or business and own it 100%. As we already known you are not under Thai law allowed to own a Thai company 100%. The Treaty of Amity however adds the exception -  American citizens. Below is a copy of the treaty however should you wish to use the treaty to register a company there are special procedures to do this as it is not viewed as a normal company.

The Kingdom of Thailand and the United States of America, desirous of promoting friendly relations traditionally existing between them and of encouraging mutually beneficial trade and closer economic and cultural intercourse between their peoples, have resolved to conclude a Treaty of Amity and Economic Relations, and for that purpose have appointed as their Plenipotentiaries:

ARTICLE I

1.       Nationals of either Party shall, subject to the laws relating to the entry and sojourn of aliens, be permitted to enter the territories of the other Party, to travel therein freely, and to reside at places of their choice and in particular to enter the territories of the other Party and to remain therein of the purpose of:

(a)    carrying on trade between the territories of the two Parties and engaging in related commercial activities; or

(b)    developing and directing the operations of an enterprise in which they have invested or are actively in process of investing a substantial amount of capital. Each Party reserves the right to exclude, restrict the movement of, or expel aliens on grounds relating to public order, morals, health and safety.

The provisions of (b) above shall be construed as extending to a national of either Party seeking to enter the territories of the other Party solely for the purpose of developing and directing the operations of an enterprise in the territories of such other Party in which his employer has invested or is actively in the process of investing a substantial amount of capital, provided that such employer is a national or company of the same nationality as the applicant and that the applicant is employed by such national or company in a responsible capacity.

2.       Nationals of either Party within the territories of the other Party shall receive the most constant protection and security, in no case less than that required by international law. When any such national is in custody, he shall in every respect receive reasonable and humane treatment; and on his demand the diplomatic or consular representative of his country shall be immediately notified and accorded full opportunity to safeguard his interests. He shall be promptly informed of the accusations against him, and allowed ample facilities to defend himself.

3.       Nationals of either Party shall enjoy in the territories of the other Party entire liberty of conscience, and, subject to applicable laws, ordinances and regulations, shall enjoy the right of private and public exercise of their worship.

ARTICLE II

1.       Companies constituted under the applicable laws and regulations of either Party shall be deemed to have the nationality of that Party and shall have their juridical status recognized within the territories of the other Party. As used in the present Treaty, “companies” means:

(a)    with reference to Thai companies: juristic persons under Thai laws, whether or not with limited liability and whether or not for pecuniary profit;

(b)    with reference to United States companies: corporations, partnerships, companies, and other associations, whether or not with limited liability and whether or not for pecuniary profit.

2.       Nationals and companies of either Party shall have free access to courts of justice and administrative agencies within the territories of the other Party, in all degrees of jurisdiction, both in the defense and in the pursuit of their rights. Such access shall be allowed upon terms no less favorable than those applicable to nationals and companies of such other Party or of any third country, including the terms applicable to requirements for deposit of security. It is understood that companies not engaged in activities within the country shall enjoy the right of such access without any requirement of registration or domestication.

3.       Contracts entered into between nationals and companies of either Party and nationals and companies of the other Party, that provide for the settlement by arbitration of controversies, shall not be deemed unenforceable within the territories of such other Party merely on the grounds that the place designated for the arbitration proceedings is outside such territories or that the nationality of one or more of the arbitrators is not that of such other Party. No award duly rendered pursuant to any such contract, and final and enforceable under the laws of the place where rendered, shall be deemed invalid or denied effective means of enforcement within the territories of either Party merely on the grounds that the place where such award was rendered is outside such territories or that the nationality of one or more of the arbitrators is not that of such Party.

ARTICLE III

1.       Each Party shall at all times accord fair and equitable treatment to nationals and companies of the other Party, and to their property and enterprises; shall refrain from applying unreasonable or discriminatory measures that would impair their legally acquired rights and interests; and shall assure that their lawful contractual rights are afforded effective means of enforcement, in conformity with the applicable laws.

2.       Property of nationals and companies of either Party, including direct or indirect interests in property, shall receive the most constant protection and security within the territories of the other Party. Such property shall not be taken without due process of law or without payment of just compensation in accordance with the principles of international law.

3.       The dwellings, offices, warehouses, factories, and other premises of nationals and companies of either Party located within the territories of the other Party shall not be subject to entry or molestation without just cause. Official searches and examinations of such premises and their contents shall be made only according to law and with careful regard for the convenience of the occupants and the conduct of business.

ARTICLE IV

1.       Nationals and companies of either Party shall be accorded national treatment with respect to establishing, as well as acquiring interests in, enterprises of all types for engaging in commercial, industrial, financial and other business activities within the territories of the other Party.

2.       Each Party reserves the right to prohibit aliens from establishing or acquiring interests, or to limit the extent to which aliens may establish or acquire interests, in enterprises engaged within its territories in communications, transport, fiduciary functions, banking involving depository functions, the exploitation of land, or other natural resources, or domestic trade in indigenous agricultural products, provided that it shall accord to nationals and companies of the other Party treatment no less favorable in this connection than that accorded nationals and companies of any third country.

3.       The provisions of paragraph 1do not include the practice of professions, or callings reserved for the nationals of each Party.

4.       Enterprises which are or may hereafter be established or acquired by nationals and companies of either Party within the territories of the other Party and which are owned or controlled by such nationals and companies, whether in the form of individual proprietorships, direct branches or companies constituted under the laws of such other Party, shall be permitted freely to conduct their activities therein upon terms no less favorable than like enterprises owned or controlled by nationals of such other Party or of any third country.

5.       Nationals and companies of either Party shall enjoy the right to control and manage the enterprises which they have established or acquired within the territories of the other Party, and shall be permitted without discrimination to do all things normally found necessary and proper to the effective conduct of enterprises engaged in like activities.

6.       Nationals and companies of either Party shall be permitted, in accordance with the applicable laws, to engage, within the territories of the other Party, accountants or other technical experts, executive personnel, attorneys, agents and other specialists of their choice. Moreover, such nationals and companies shall be permitted to engage accountants and other technical experts, regardless of the extent to which they may have qualified for the practice of a profession within the territories of such other Party, for the particular purpose of making examinations, audits and technical investigations for internal purposes exclusively for, and rendering reports to, such nationals and companies in connection with the planning and operation of their enterprises within such territories.

ARTICLE V

1.       Nationals and companies of either Party shall be accorded national treatment within the territories of the other Party with respect to:

(a)    leasing immovable property needed for their residence or for the conduct of activities pursuant to the present Treaty;

(b)    purchasing and otherwise acquiring movable property of all kinds, subject to any limitations on acquisition of shares in enterprises that may be imposed consistently with Article IV; and

(c)     disposing of property of all kinds by sale, testament or otherwise.

2.       Nationals and companies of either Party shall have within the territories of the other Party the same right as nationals and companies of that other Party in regard to patents for invention, trade marks, trade names, designs and copyright in literary and artistic works, upon compliance with the applicable laws and regulations, if any.

ARTICLE VI

1.       Nationals and companies of either Party shall not be subject to the payment of taxes, fees or charges within the territories of the other Party, or to requirements with respect to the levy and collection thereof, more burdensome than those borne by nationals, residents and companies of any third country. In the case of nationals of either Party residing within the territories of the other Party, and of companies of either Party engaged in trade or other gainful pursuit or in non-profit activities therein, such taxes, fees, charges and requirements shall not be more burdensome than those borne by nationals and companies of such other Party.

2.       Each Party, however, reserves the right to:

(a)    extend specific tax advantages only on the basis of reciprocity, or pursuant to agreements for the avoidance of double taxation or the mutual protection of revenue: and

(b)    apply special provisions in extending advantages to its nationals and residents in connection with joint returns by husband and wife, and as to the exemptions of a personal nature allowed to non-residents in connection with income and inheritance taxes.

3.       Companies of either Party shall not be subject, within the territories of the other Party, to the payment of taxes upon income not attributable to sources within such territories, or upon transactions or capital not attributable to the operations and investments thereof within such territories.

4.       The foregoing provisions shall not prevent the levying, in appropriate cases, of fees relating to the accomplishment of police and other formalities, if these fees are also levied on nationals of all third countries. The rates for such fees shall not exceed those charged such nationals of any third country.

ARTICLE VII

1.       Neither Party shall apply restrictions on the making of payments, remittances, and other transfers of funds to or from the territories of the other Party, except

(a)    to the extent necessary to assure the availability of foreign exchange for payments for goods and services essential to the health and welfare of its people, or

(b)    in the case of a member of the International Monetary Fund, restrictions specifically requested or approved by the Fund.

2.       If either Party applies exchange restrictions, it shall make reasonable provision for the withdrawal in foreign exchange in the currency of the other Party, of:

(a)    the compensation referred to in Article III, paragraph 2, of the present Treaty;

(b)    earnings, whether in the form of salaries, interest, dividends, commissions; royalties, payments for technical services, or otherwise; and

(c)     amounts for amortization of loans, depreciation of direct investments and capital transfers, giving consideration to special needs for other transactions. If more than one rate of exchange is in force, the rate applicable to such withdrawal shall be a rate that is specifically approved by the International Monetary Fund for such transactions.

3.       Either Party applying exchange restrictions shall in general administer them in a manner not to influence disadvantageously the competitive position of the commerce, transport or investment of capital of the other Party in comparison with the commerce, transport or investments of any third country.

ARTICLE VIII

1.       Each Party shall accord to products of the other Party, from whatever place and by whatever type of carrier arriving, and to products destined for exportation to the territories of such other Party, by whatever route and by whatever type of carrier, treatment no less favorable than that accorded like products of, or destined for exportation to, any third country, in all matters relating to:

(a)    customs duties, as well as any other charges, regulations and formalities levied upon or in connection with importation and exportation; and

(b)    internal taxation, sale, distribution, storage and use. The same rule shall apply with respect to the international transfer of payments for imports and exports.

2.       Neither Party shall impose restrictions or prohibitions on the importation of any product of the other Party, or on the exportation of any product to the territories of the other Party, unless the importation of the like product of, or the exportation of the like product to, all third countries is similarly restricted or prohibited.

3.       If either Party imposes quantitative restrictions on the importation or exportation of any product in which the other Party has an important interest:

(a)    It shall, upon request, inform the other Party of the approximate total amount of the product, by quantity or value, that may be imported or exported during a specified period, and of any change in such amount or period; and

(b)    If it makes allotments to any third country, it shall afford such other Party a share proportionate to the amount of the product, by quantity or value, supplied by or to it during a previous representative period, due consideration being given to any special factors affecting the trade in such product.

4.       Either Party may impose prohibitions or restrictions on sanitary or other customary grounds of a non-commercial nature, or in the interest of preventing deceptive or unfair practices, provided such prohibitions or restrictions do not arbitrarily discriminate against the commerce of the other Party.

5.       Either Party may adopt measures necessary to assure the utilization of accumulated inconvertible currencies or to deal with a stringency of foreign exchange. However, such measures shall deviate no more than necessary from a policy designed to promote the maximum development of non-discriminatory international trade and to expedite the attainment of a balance of payments position which will obviate the necessity of such measures.

 

 

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