A Guide to the Board of Investment 2017 the Board of Investment 2017

Thailand Board of Investment www.boi.go.th A Guide to

Thailand Board of Investment 555 Vibhavadi-Rangsit Road, Chatuchak, Bangkok 10900, Thailand Tel: +66 (0) 2553 8111 Fax: +66 (0) 2553 8315 Website: www.boi.go.th E-mail: [email protected]

April 2017 Revision November 2017 A Guide to the Board of Investment 2017

PREFACE

This Guide to the Board of Investment was prepared by the Office of the Board of Investment to provide basic information on BOI investment promotion for applications submitted from January 1, 2015, onward. This guidebook comprises investment promotion incentives and privileges, the list of activities eligible for investment promotion and related announcements including essential rules and criteria for applying investment promotion.

Since the policies and criteria for granting privileges and the list of the eligible activities for investment promotion are subject to change over time, investors can access updated information from the BOI’s website at www.boi.go.th or send their enquiries to [email protected] or contact the Investment Services Center Tel:+66(2) 553-8111 and 0-2553-8216.

Office of the Board of Investment November 2017

Disclaimer: Contents of this publication are for informational purposes only and should not be seen as complete or legally binding. For clarification and/or confirmation of information, please contact appropriate BOI officials.

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TABLE OF CONTENTS

Page CHAPTER 1 CRITERIA AND POLICIES About the Office of the Board of Investment 4

Incentives under the Investment Promotion Act 6

Seven-Year Investment Promotion Strategy (2015 - 2021) 7

Criteria for Granting Promotion Incentives 12

General list of activities eligible for investment promotion 25

Other Policies and Special Measures

Measure for Improvement of Production Efficiency 82

Investment Promotion Policy for Industrial Development in Border Provinces in 90 Southern Thailand and Investment Promotion Policy for Industrial Development for model cities of Border Provinces in Southern Thailand

Investment Promotion Policy for Investment in Special Economic Zones 93

List of Targeted Industries to Promote in the Special Economic Zones 97

CHAPTER 2 PROCEDURES OF APPLYING FOR BOI PROMOTION Procedures of utilization of promotional privileges 111

Procedures to apply for BOI Promotion 111

Processes for Project Applicantion and Utilization 112

Investment Promotion Procedures and Timeframe 114

CHAPTER 3 FEASIBILITY STUDY Feasibility Study for projects applying for investment promotion 118

3 A Guide to the Board of Investment 2017 CHAPTER 1 CRITERIA AND POLICIES

ABOUT THE OFFICE OF THE BOARD OF INVESTMENT

The Office of the Board of Investment is a government agency under the Office of the Prime Minister. Its main roles and responsibilities are to promote investment. The Board of Investment prescribes the investment promotion policies under Investment Promotion Act B.E. 2520 and Amendment Acts No. 2 B.E. 2534 and No. 3 B.E. 2544. Organization Chart of Office of the Board of Investment

Office of the Prime Minister Policy Office of the Board of Investment Board of Investment

Office of the Secretary Investment Strategy and Policy Division Investment Service Center International Affairs Division Foreign Investment Marketing Thai Overseas Investment Promotion Division Investment Ecosystem Division Information Technology Center Regional Investment and Economic Center 1-7 Industrial Linkage Development Division • Chaing Mai • Chon Buri • Nakhon • Songkhla Ratchasima • Surat Thani Investment Promotion Division 1-5 • Khon Kaen • Phitsanulok • Bio-based and Medical Industries • Advanced Manufacturing Industries Overseas Offices • Basic and Supporting Industries • High Value Services • Tokyo • Taipei • Creative and Digital Industries • Osaka • Sydney • Seoul • Frankfurt • Beijing • Paris One Stop Service Center and • Guangzhou • New York Work Permits under • Shanghai • Los Angeles • Office of the Board of Investment • Stockholm • Mumbai One Start One Stop • Immigration Bureau Investment Center • Department of Employment (OSOS)

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Bureau Supervising and Analyzing Investment Promotion Projects and Bureau/Division Providing Advisory Services

Investment Promotion Division

Investment Investment Investment Investment Investment Promotion Promotion Promotion Promotion Promotion Division 1 Division 2 Division 3 Division 4 Division 5

Supervising and Supervising and Supervising and Supervising and Supervising and analyzing investment analyzing investment analyzing investment analyzing investment analyzing investment promotion projects promotion projects promotion projects promotion projects promotion projects »»Bio-based and »»Advanced »»Basic and »»High Value »»Creative and Medical Manufacturing Supporting Services Digital Industries Industries Industries Industries

Division Providing Advisory Services

Investment Service One Start One Stop Industrial Linkage Center Investment Center Development Division (OSOS)

Provides advice on applying Provides advice on Provides support on for investment promotion business operation and industrial linkage and obtaining licenses business missions

5 A Guide to the Board of Investment 2017

INCENTIVES UNDER THE INVESTMENT PROMOTION ACT

In order to obtain investment promotion, the BOI applicant must follow the conditions prescribed by the Board of Investment as specified in the BOI promotion certificate in which the following incentives will be granted:

Incentives

Tax Incentives Non-Tax Incentives

• Exemption/reduction of import duties on • Permit for foreign nationals to enter the machinery (Section28/29) Kingdom for the purpose of studying • Reduction of import duties for raw or essential investment opportunities. (Section 24) materials (Section 30) • Permit to bring into the Kingdom skilled • Exemption of import duties on materials workers and experts to work in investment imported for R&D purposes (Section 30/1) promoted activities (Section 25 and 26) • Exemption of corporate income tax on the • Permit to own land (Section 27) net profit and dividends derived from the • Permit to take out or remit money abroad in promoted activity (Section 31 and 34) foreign currency (Section 37) • Exemption of corporate income tax on net profit and dividends derived from the promoted high technology and innovation activity (Section 31/1) • A 50 percent reduction of the corporate income tax (Section 35(1)) • Double deduction from the costs of transportation, electricity and water supply (Section35(2)) • Additional 25 percent deduction of the cost of installation or construction of facilities (Section35(3)) • Exemption of import duty on raw or essential materials imported for use in production for export (Section 36)

Use of Corporate Income Tax Incentives

To ensure that the incentives are granted effectively and exercised correctly in accordance with promotion conditions and to ensure the clear cost-and-benefit evaluation of investment promotion, promoted persons must report operating results for their projects to the Office of the Board of Investment for review prior to being granted corporate income tax incentives for that year. The reporting criteria and method shall be as prescribed by the Office of the Board of Investment.

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SEVEN-YEAR INVESTMENT PROMOTION STRATEGY (2015 – 2021)

According to the Announcement of the Board of Investment No.2/2557 Policies and Criteria for Investment Promotion announced on December 3, 2014 which is enforced on BOI applications submitted from January 1, 2015, onward:

Vision

To promote valuable investment, both investment in Thailand and Thai overseas investment to enhance Thailand’s competitiveness, to overcome the “Middle Income Trap” and to achieve sustainable growth in accordance with the sufficiency economy philosophy.

Investment Promotion Policies

1. Promote investment that helps enhance national competitiveness by encouraging R&D, innovation, value creation in the agricultural, industrial and services sectors, SMEs, fair competition, and reduce social and economic disparity. 2. Promote activities that are environment-friendly, save energy or use alternative energy to drive balanced and sustainable growth. 3. Promote clusters to create investment concentration in accordance with regional potential and to strengthen value chains. 4. Promote investment in border provinces in Southern Thailand to help develop the local economy, which will support efforts to enhance security in the area. 5. Promote special economic zones, especially in border areas, both inside and outside industrial estates, to create economic connectivity with neighboring countries and to prepare for entry into the ASEAN Economic Community (AEC). 6. Promote Thai overseas investment to enhance the competitiveness of Thai businesses and Thailand’s role in the global economy.

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Criteria for Project Approval

1. In order to develop competitiveness in the agricultural, industrial and service sectors, projects submitted for BOI promotion must have the following qualifications: 1.1 The value-added of the project must not be less than 20% of revenues, except for projects in agriculture and agricultural products, electronic products and parts, and coil centers, all of which must have value-added of at least 10% of revenues. 1.2 Modern production processes must be used. 1.3 New machinery must be used. In case of imported used machinery, the criteria for consideration will be classified into 3 cases, as follows: 1) General Case

Counted as Allowed investment capital to be Import Type of for calculation of used Duty Conditions Machinery CIT exemption cap in the Exemption (If Section 31 is project granted)

New machinery P P P

Used machinery not exceeding 5 The machinery years. (from P P O performance manufacturing certificate must year to import be submitted year) on the same date in which Used machinery the master list exceeding 5 of machinery years but not P O O is submitted exceeding 10 years.

2) Factory Relocation Case

Counted as Allowed investment capital to be Import Type of for calculation of used Duty Conditions Machinery CIT exemption cap in the Exemption (If Section 31 is project granted)

New machinery P P P The machinery performance certificate must be submitted on the same Used machinery date in which not exceeding 5 P P O the BOI years. application and master list of machinery are submitted

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Counted as Allowed investment capital to be Import Type of for calculation of used Duty Conditions Machinery CIT exemption cap in the Exemption (If Section 31 is project granted)

Used machinery not exceeding 5 P P O years. The machinery performance P certificate must Used machinery (Investment cap be submitted exceeding 5 shall be based on on the same years but not P 50% of the O date in which exceeding 10 machinery value the BOI years. from the list of application and machinery) master list of machinery are Used machinery submitted. exceeding 10 P O O years

3) Other Cases

Counted as investment Allowed to be capital for Import Duty Type of Machinery used in the calculation of CIT Exemption project exemption cap (If Section 31 is granted)

Sea and Air Transport P P P Services* Mold and Dies

Remarks - ‘Relocation of factory refers to the relocation of the production line either partially or in its entirely from a foreign country where the machinery to be used in the project belongs to affiliates or related companies. - Machinery Performance Certificate refers to a certificate issued by a trusted institute that grants a machinery performance certificate, which includes a certified report on reconditioned machinery together with detailed documentation of the reconditioning. The inspection of certified machinery and equipment shall include a full test run of the machinery to evaluate its capacity and functionality, as prescribed by requirements of the testing procedure. An environmental impact report, a safety standards check and an energy consumption report must be compiled in accordance with the acceptable criteria. A certified report must identify 6 significant details, as follows: 1) Details on reconditioning and an analysis of the remaining lifecycle of the machinery; 2) Year of manufacture; 3) Test-run results; 4) An environmental impact report, safety standards check and an energy consumption report; 5) Appropriate price estimation (the price estimation certificate can be submitted separately); 6) Inspection report with date and place of inspection.

* note: Planes in the Air Transportation Services project must be no more than 14 years old. (Please see condition under activity 7.3.4)

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1.4 Projects that have investment capital of 10 million baht or more (excluding cost of land and working capital) must obtain ISO 9000 or ISO 14000 certification or similar international standard certification within 2 years from the full operation start-up date, otherwise the corporate income tax exemption shall be reduced by one year. 1.5 For a concession project and the privatization of a state enterprise project, the Board’s criteria shall be based on the Cabinet’s decisions dated May 25, 1998 and November 30, 2004. 1.6 The state enterprise investment projects under the Capital of Public Enterprise Act, B.E. 2542, will not be granted for concession if the project is operated by private sector. The project need to be transfered to be state-owned enterprise project in order to receive an investment promotion. The state need to submit project approval form to the BOI for consideration before start bidding with private company. During an auction, there must be a clear announcement on private’s privileges. Normally, the BOI will not promote investment project if private sector need to pay compensations to the state except those compensation is reasonable for an investment project. 1.7 For state enterprise projects that are owned, operated and rent by private sectors, the Board will use normal investment criteria for project approval. 1.8 For the privatization of state enterprise projects, after privatizing from state enterprises, the limited companies should set appropriate budgets in order to asking for the Board’s investment promotion under the Capital of Public Enterprise Act, B.E. 2542. In case of expanding projects, the limited company will be granted only parts of expansion under normal promotion incentives.

2. Environmental protection 2.1 Adequate and efficient guidelines and measures to protect environmental quality and to reduce environmental impact must be installed. The Board will give special consideration to the location and pollution treatment of a project with potential environmental impact. 2.2 Projects or activities with type and size that are required to submit environmental impact assessment reports must comply with related environmental laws and regulations or Cabinet resolutions. 2.3 Projects located in Rayong must comply with the Office of the Board of Investment Announcement No. Por 1/2554 dated May 2, 2011, on Industrial Promotion Policy in Rayong Province.

3. Minimum capital investment and project feasibility 3.1 The minimum capital investment requirement of each project is 1 million baht (excluding cost of land and working capital) unless specified otherwise on the list of activities eligible for investment promotion that is attached to this announcement. As for knowledge-based services, the minimum capital investment requirement is based on the minimum annual salaries expense specified in the list of activities eligible for investment promotion. 3.2 For newly established projects, the debt-to-equity ratio must not exceed 3 to 1. Expansion projects shall be considered on a case-by-case basis. 3.3 For projects with an investment value over 750 million baht (excluding cost of land and working capital) the project’s feasibility study must be submitted with details as specified by the Board.

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Criteria for Foreign Shareholding

The Board stipulates the following criteria for foreign shareholding in projects that apply for investment promotion: 1. For projects in activities under List One annexed to the Foreign Business Act, B.E. 2542, Thai nationals must hold shares totaling not less than 51% of the registered capital. 2. For projects in activities under List Two and List Three annexed to the Foreign Business Act, B.E. 2542, there are no equity restrictions for foreign investors except as specified in other laws. 3. The Board may set foreign shareholding limits for certain activities eligible for investment promotion, as deemed appropriate.

11 A Guide to the Board of Investment 2017 Criteria for Granting Investment Incentives

Exemption of Exemption of Exemption of Exemption of Non-tax corporate import duties on import duties on import duties on incentives income tax machinery raw materials raw materials used in R&D used in production for export 8-years Activities no cap 7.11 and 7.12.1 - 7.12.4

-based Incen 8-years vity tive cti s A 5-years

3-years

A1 A2 A3 A4 B1 B2 10-years no cap 10-years

no cap

Activities o

General List of Activities Eligible for t

Support n e

8 m Targeted Investment Promotion p n o l o Technology i e t v c e e * d S t tives r in Knowledge-based activities focusing on R&D and en * po s c Pr p ie A1 B1 In ojec st su g design to enhance the country’s competitiveness. t mu olo d 4 c echn Supporting industry that does not use high se ore t technology, but is still important to the a b Infrastructure activities for the country’s value chain. - Section 8 development, activities using advanced y A2 technology to create value-added, with no or B2 g Technology and very few existing investments in Thailand. o l Innovation o Activities which support the development of targeted

n Development High technology activities which are important technology and have cooperation according to the

h A3 to the development of the country, with a few conditions presented by the Board including activities

c investments already existing in Thailand. 5.6, 7.11, 7.13, 7.14, 7.15 and 7.1.

e T Biotech Digital Activities with lower technology than A1-A3 Section 8: Technology and Innovation Development includes targeted core technology development such Nanotech Advanced A4 but which add value to domestic resources 8 and strengthen the supply chain. as development of biotechnology, nanotechnology, Material advanced materials technology and digital technology.

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-based Incen 8-years vity tive cti s A 5-years

3-years

A1 A2 A3 A4 B1 B2 10-years no cap 10-years

no cap

Activities o

General List of Activities Eligible for t

Support n e

c investments already existing in Thailand. 5.6, 7.11, 7.13, 7.14, 7.15 and 7.1.

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In order to attract and stimulate more investment or spending on activities that benefit the country or industry at large, the Board stipulates additional incentives based on the merits of the project, as follows:

Additional corporate income tax exemption of up to 2.1 3-years Merit for

Deduction of Competitiveness 25% from the net Enhancements investment of the cost of the project’s Additional Double deduction infrastructure installation or tax exemption of for transportation, construction electricity and water up to costs for 10 years 300%

2.2 Merit on Decentralization

Group A1 or A2 shall receive a 2.3 50% reduction in corporate Additional Merit for income tax for corporate income tax Industrial Area 5 years exemption of up to Developments 3-years

Additional corporate income tax exemption of up to 1-year

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Additional Cap Percentage of Investment or Expense

Research, Technology Development and Innovation: In-house, outsourced in Thailand or joint R&D with overseas institutes 300%

Donations to technology and human resource development funds, educational institutes, specialized training centers, R&D institutes or governmental agencies in the S&T ﬁeld in Thailand, 100% as approved by the Board

IP acquisition/licensing fees for commercializing technology developed in Thailand 200%

Advanced technology training 200%

Development of local suppliers with at least 51% Thai shareholding in advanced technology training and technical assistance 200%

Product & packaging design: In-house or outsourced in Thailand, as approved by the Board 200%

Additional CIT Exemption (with additional cap)

1% or not less than 200 million baht 1 year whichever lower

2% or not less than 400 million baht 2 years whichever lower

3% or not less than 600 million baht 3 years whichever lower

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Exemption of Additional corporate corporate income tax Total income tax exemption 8-years 1-3 years 9-11 years no cap no cap no cap

itional Incentiv 1-3 years 9-11 years dd iveness Enh es 8-years with additional cap with additional cap A etit ance mp me Co nt or 1-3 years 6-8 years f 5-years with additional cap with additional cap 1-3 years 4-6 years 3-years with additional cap with additional cap

1-3 years* 1-3 years*

A1 A2 A3 A4 B1 B2 10-years 11-13 years no cap 1-3 years no cap 10-years 11-13 years no cap 1-3 years no cap

* Tax exemption will depend on the investment amount/

expenditure for enhancing competitiveness

Activities o

Support n e

8 m Targeted p General List of Activities Eligible for Investment Promotion n o l o Technology i e t v c e e for Competitiveness Enhancement * d S t tives r in en * po s c Pr p ie In ojec st su g t mu olo d 4 c echn Knowledge-based activities focusing on R&D and Supporting industry that does not use high se ore t technology, but is still important to the a A1 design to enhance the country’s competitiveness. B1 b value chain. - Section 8 y Activities which support the development of targeted g Technology and Infrastructure activities for the country’s o development, activities using advanced technology and have cooperation according to the l Innovation A2 technology to create value-added, with no or conditions presented by the Board including activities o very few existing investments in Thailand. 5.6, 7.11, 7.13, 7.14, 7.15 and 7.1.

n Development h

c Section 8: Technology and Innovation Development e High technology activities which are important

includes targeted core technology development such T Biotech Digital A3 to the development of the country, with a few 8 investments already existing in Thailand. as development of biotechnology, nanotechnology, advanced materials technology and digital technology. Nanotech Advanced Material Activities with lower technology than A1-A3 A4 but which add value to domestic resources and strengthen the supply chain.

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Exemption of Additional corporate corporate income tax Total income tax exemption 8-years 1-3 years 9-11 years no cap no cap no cap itional Incentiv 1-3 years 9-11 years dd iveness Enh es 8-years with additional cap with additional cap A etit ance mp me Co nt or 1-3 years 6-8 years f 5-years with additional cap with additional cap 1-3 years 4-6 years 3-years with additional cap with additional cap

1-3 years* 1-3 years*

A1 A2 A3 A4 B1 B2 10-years 11-13 years no cap 1-3 years no cap 10-years 11-13 years no cap 1-3 years no cap

* Tax exemption will depend on the investment amount/

expenditure for enhancing competitiveness

Activities o t

Support n e

n Development h

c Section 8: Technology and Innovation Development e High technology activities which are important

17 A Guide to the Board of Investment 2017

Applying for Merit–based Incentive

Applicants can choose to apply for one type or many types of merit-based incentives, but they must be in accordance with the prescribed criteria. 1. Projects entitled to CIT exemption (A1-A4) - Applicants who would like to be granted for Merit-based incentives have to submit a Competitiveness Enhancement form (F PA PP 37-00) with approval form. Applicants can submit additional application after the first submission. - Applicants can submit additional application only if they are exempted for corporate income tax under section 31, either time period or capital left for tax exemption. 2. Projects not entitled to CIT exemption (B1-B2) - Applicants who would like to be granted for Merit-based incentives have to submit a Competitiveness Enhancement form (F PA PP 37-00) with approval form only.

Additional explanatory for merit-based granting under expenditure for donations to technology and human resource development funds, as follows: 1. Applicants have to submit an approval supporting plan from NSTDA Academy*. The process must be finished before an expiration of corporate income tax incentive granted by normal criteria. 2. Applicants have to submit an approval supporting plan from NSTDA Academy*. The process must be finished within one year, starting from the first day that companies generate revenues. 3. For the consideration of expenditures for donations to technology and human resource development funds, the expenditures shall be compared with the total revenue of the promoted project only. If actual expenditure is higher than expected expenditure, applicants will be granted for another year, starting from an ending period of the third-year activity. On the other hand, if actual expenditure is less than expected expenditure, applicants will not be allowed to redeem for supporting funds.

*Applicants who would like to be granted under condition have to submit an intention form for granting under expenditure for donations to technology and human resource development funds to NSTDA Academy. Applicants have to submit an intention form with approval form after being approved by NSTDA Academy.

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Map of Thailand

The 20 Provinces with lowest per capita income Kalasin, Chaiyaphum, Nakhon Phanom, Nan, Bueng Kan, Buri Ram, Phrae, Maha Sarakham, Mukdahan, Mae Hong Son, Yasothon, Roi Et, Si Sa Ket, Sakhon Nakhon, Sa Kaew, Sukhothai, Surin, Nong Bua Lamphu, Ubon Ratchatani and Amnatcharoen

Promoted Industrial Estate / Zone Projects located within industrial estates or promoted industrial zones shall be granted one additional year of corporate income tax exemption.

Special Economic Development Zones* 90 sub-districts in 23 districts of 10 provinces which are Chiang Rai, Nakhon Panom, Tak, Kanjanaburi, Nongkhai, Mukdahan, Sa Kaew, Trad, Songklah and Narathiwas.

Promoted Border Provinces in Southern Thailand* Southern Border Provinces include Narathiwat, Pattani, Yala, Satun and four districts in Songkhla (Jana district, Natawee district, Saba Yoi district and Taypa district).

* For more information, please see a Guide to the Board of Investment 19 A Guide to the Board of Investment 2017

Projects located in 20 provinces with lowest per capita income (see map on page 19)—Kalasin, Chaiyaphum, Nakhon Phanom, Nan, Bueng Kan, Buri Ram, Phrae, Maha Sarakham, Mukdahan, Mae Hong Son, Yasothon, Roi Et, Si Sa Ket, Sakhon Nakhon, Sa Kaew, Sukhothai, Surin, Nong Bua Lamphu, Ubon Ratchatani and Amnatcharoen (excluding border provinces in Southern Thailand and 50% Exemption of Additional Corporate income Deduction Special Economic Development Zones which have separate special incentive packages)—shall receive corporate Total corporate income tax reduction of expense* additional incentives, as follows: income tax tax exemption for 5 years 8-years no cap 8-years + 50% corporate income no cap tax reduction for 5 years al Ince 8-years dition ntive + 50% corporate income Ad ecentralizatio s 8-years tax reduction for 5 years on D n 5-years 3-years 8-years

3-years 3-years 6-years

3-years 3-years

A1 A2 A3 A4 B1 B2 10-years 13-years no cap 3-years no cap 10-years 13-years no cap 3-years no cap

* - Double deductions from the costs of transportation, electricity and water supply for 10 years

- Additional 25% deduction of the cost of installation or construction of facilities

Activities o

Support n e

8 m Targeted p General List of Activities Eligible for Investment Promotion n o l o Technology i e t v c e e on Decentralization * d S t tives r in en * po s nc Pro up ie I ject ust s og d m ol Supporting industry that does not use high e 4 core techn Knowledge-based activities focusing on R&D and s technology, but is still important to the a A1 design to enhance the country’s competitiveness. B1 b value chain. - Section 8 y g Technology and Infrastructure activities for the country’s Activities which support the development of targeted o technology and have cooperation according to the l development, activities using advanced Innovation A2 technology to create value-added, with no or conditions presented by the Board including activities o 5.6, 7.11, 7.13, 7.14, 7.15 and 7.1.

n Development very few existing investments in Thailand. h

c Section 8: Technology and Innovation Development e High technology activities which are important

20 A Guide to the Board of Investment 2017

50% Exemption of Additional Corporate income Deduction corporate Total corporate income tax reduction of expense* income tax tax exemption for 5 years 8-years no cap 8-years + 50% corporate income no cap tax reduction for 5 years al Ince 8-years dition ntive + 50% corporate income Ad ecentralizatio s 8-years tax reduction for 5 years on D n 5-years 3-years 8-years

3-years 3-years 6-years

3-years 3-years

A1 A2 A3 A4 B1 B2 10-years 13-years no cap 3-years no cap 10-years 13-years no cap 3-years no cap

* - Double deductions from the costs of transportation, electricity and water supply for 10 years

- Additional 25% deduction of the cost of installation or construction of facilities

Activities o t

Support n e

n Development very few existing investments in Thailand. h

c Section 8: Technology and Innovation Development e High technology activities which are important

21 A Guide to the Board of Investment 2017

Projects located within industrial estates or promoted industrial zones (see map on page 19) shall be granted one additional year of corporate income tax exemption. Exemption of Additional corporate corporate income Total income tax tax exemption 8-years 8-years no cap no cap al Ince dition ntive d ial Area Devel s 8-years 8-years A ustr opm nd en n I t o 5-years 1-year 6-years

3-years 1-year 4-years

A1 A2 A3 A4 B1 B2 10-years 11-years no cap 1-year no cap 10-years 11-years

no cap 1-year no cap

Activities o

Support n e

8 m Targeted p General List of Activities Eligible for Investment Promotion n o l o Technology i e t v c e e on Industrial Area Development * d S t tives r in en * po s nc Pro up ie I ject must s og Activities which support the development of targeted d nol High technology activities which are important se 4 core tech technology and have cooperation according to the a A3 to the development of the country, with a few conditions presented by the Board including activities b investments already existing in Thailand. 5.6, 7.11, 7.13, 7.14, 7.15 and 7.1. - Section 8 y g Technology and Activities with lower technology than A1-A3 Section 8: Technology and Innovation Development o includes targeted core technology development such l A4 but which add value to domestic resources Innovation 8 as development of biotechnology, nanotechnology, o and strengthen the supply chain.

n Development advanced materials technology and digital technology.

e T Biotech Digital

Nanotech Advanced Material

22 A Guide to the Board of Investment 2017

Exemption of Additional corporate corporate income Total income tax tax exemption 8-years 8-years no cap no cap al Ince dition ntive d ial Area Devel s 8-years 8-years A ustr opm nd en n I t o 5-years 1-year 6-years

3-years 1-year 4-years

A1 A2 A3 A4 B1 B2 10-years 11-years no cap 1-year no cap 10-years 11-years

no cap 1-year no cap

Activities o t

Support n e

n Development advanced materials technology and digital technology.

e T Biotech Digital

Nanotech Advanced Material

23 A Guide to the Board of Investment 2017

24 A Guide to the Board of Investment 2017

General List of Activities Eligible for Promotion

Investors applying for BOI promotion should be well-prepared with information of the activities eligible for promotion and in particular the specific conditions under each activity.

Updated information of types, sizes and conditions of activities eligible for promotion is assembled from the various announcements, details of which an investor is encouraged to thoroughly review before applying for BOI promotion.

25 26

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 Section 1:Agriculture andAgriculturalProducts 1.2 1.1 1.4 1.3 Plant oranimalbreeding Manufacture ofbiologicalfertilizers, Crop drying and silofacilities Economic forest plantation biotechnology activity) (only thosethatare noteligiblefor bio-pesticides organo chemicalfertilizerand organic fertilizers,nano-coated (except forEucalyptus) Activities 2. 1. 3. 2. 1. 3. 2. 1. 5. 4. 3. registered capital. not lessthan51percent ofthe Thai nationalsholding shares totaling Cooperatives, projects musthave Ministry ofAgriculture and according tothepolicyof For breeding ofsensitiveplants development activities. Projects musthaveresearch and academic reference. innovations thathavesupporting Projects mustuseinoculantsor Department ofAgriculture. permission toproduce from the and obtainedcertificateof Bio-pesticides mustberegistered from theDepartmentofAgriculture. manufacturing fertilizerfortrade and obtainedlicensefor chemical fertilizermustberegistered fertilizers andnano-coatedorgano Biological fertilizers,organic and Environment. the MinistryofNaturalResources Projects mustreceive approval from development activity. Projects musthaveresearch and adjacent. rai, atleast50raiofwhichmustbe proximity mustnotbelessthan300 Total plantationarea inclose 1,500,000 bahtperyear. salaries forR&Dpersonnelofatleast Projects musthaveexpensesfor corporate taxexemptionperiod. for 5yearsaftertheendofits reduction ofcorporateincometax will receive anadditional50percent or onethatisapproved bytheBoard technology park,promoted byBOI Projects locatedinthescienceand for thepropagation ofcassava. revenue ofpromoted projects, except the project shallberegarded as propagation afterplantbreeding in Revenue derivedfrom plant Conditions Incentives B 1 A 3 A 1 A 3 1.5 1.8 1.7 1.6 Animal propagation oranimal Grading, packagingandstorageof Deep seafishery Slaughtering 1.5.2 1.5.1 husbandry plants, vegetables,fruitsorflowers shrimp) aquaculture (exceptfor Livestock husbandryor animal propagation Livestock andaquatic Activities 3. 2. 1. 3. 2. 1. 3. 2. 1. 3. 2. 1. 2. 1. promoted. raising process shallnotbe Hatching eggswithoutbreeder- system. Projects musthavetraceability and countinganimals. system, sensorsystemfortracking system, vectorcontrol measure and automatic wateringandfeeding system, evaporativecooling technology, e.g.closedhouse Projects mustusemodern technology only. Rice grading must useadvanced coating. treatment tokillfruitflyeggs,seed e.g. colorsorter, vaporheat Projects technology, usingmodern magnetic resonance. frequency pestcontrol, nuclear e.g. fruitripenesssensor, radio Projects usingadvancedtechnology, embedded trackingunit. equipment, fishfinderand Boats musthavenavigation gross tons. Long lineboatmustbeatleast150 least 500gross tons. Surrounding netboatmustbeat system. Projects musthavetraceability contaminant inspection. system, meatqualityand shackle, coldstorage,chilling technology, e.g.stunningmethod, Projects mustusemodern Projects musthavetraceabilitysystem. reduction system. environmental protection andimpact and countinganimalseffective and system,sensorsystemfortracking feeding system,vectorcontrol measure cooling system,automaticwateringand e.g. closedhousesystem,evaporative Projects technology, mustusemodern process. Projects musthavepropagation Conditions A GuidetotheBoard ofInvestment2017 Incentives A 3 A 2 A 3 A 4 A 4 A 4 27 General List of Activities Eligible for Investment Promotion 28

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 1.15 1.14 1.13 1.12 1.11 1.10 1.9 Manufacture ofnaturalrubber Tanneries orleatherfinishing Manufacture ofactiveingredients Manufacture ofnaturalextractsor Manufacture ofoilorfatfrom Manufacture ofmodifiedstarch or dehydration) processes, e.g.drying, with uncomplicatedproduction agricultural waste(exceptforthose agricultural by-products or Manufacture ofproducts from 1.14.2 1.14.1 rings) bands, rubberballoonsand products (exceptforrubber from naturalrawmaterials cosmetics) shampoo, toothpasteand (except formedicine,soap, products from naturalextracts soybean oil) plants oranimals(exceptfor special properties starch madefrom plantsthathave products Manufacture ofrubber processed rubber Manufacture ofprimary Activities 2. 1. study onactionandtoxicity. Projects must be supported by academic 2. 1. industrial zones. industrial estatesorpromoted Tanneries mustbelocatedin chemicals. biological catalystsinsteadof chemical use,useofenzymeor friendly technology, e.g.reduction of Projects mustuseenvironment- produce orcrudeoil. plants muststartfrom agricultural Manufacture ofrefined oilfrom from agriculturalproduce. refined oilfrom plantsmuststart Manufacture ofcrudeorsemi- Conditions Incentives A 4 A 2 A 4 A 3 A 2 A 4 A 3 A 3 1.18 1.17 1.16 1.19 Manufacture ofmedicalfoodor Manufacture orpreservation of Cold storage,orcoldstorage and food supplements of chickenandbird’s nest) products, instantnoodles,essence made from plants,bakery beverages andflourorstarch alcoholic beverages,caffeinated gum, sugar, carbonatedsoftdrinks, water, icecream, candy, chocolate, technology (exceptfordrinking food ingredients usingmodern food, beverages,foodadditivesor 1.16.3 1.16.2 1.16.1 waste agricultural scraporgarbage agricultural products, including Manufacture offuelfrom cold storagetransportation briquettes andpellets Manufacture ofbiomass biogas from wastewater biomass toliquid(BTL), garbage orwaste,e.g. agricultural scrapor Manufacture offuelfrom agricultural products Manufacture offuelfrom Activities 3. 2. 1. 2. 1. 2.2 2.1 vegetable andfruitwillbepromoted Only beveragemadefrom plants, supporting studyorresearch. must usestartercultures thathave Project withfermentationprocess process shallnotbepromoted. Project withonlymixingordilution supplements, For themanufacture offood standards. accepted with internationally Administration orotheragencies “medical food”byFoodandDrug products mustberegistered as For themanufacture ofmedicalfood, ingredient extractionprocess. Projects musthaveanactive accepted standards. agencies withinternationally Administration orother Thai FoodandDrug “Food Supplements”bythe Product mustberegistered as Conditions A GuidetotheBoard ofInvestment2017 Incentives B 1 A 3 A 3 A 2 A 2 A 2 29 General List of Activities Eligible for Investment Promotion 30

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 Remarks: Activity1.21hasbeenexpired 1.23 1.22 1.20 Manufacture agricultural ofmodern Manufacture ofanimalfood Trading Centerforagricultural greenhouse systems fertilizers, medicines)andsmart regulation systems(suchaswater, or trackingsystems,resources agriculturemodern e.g.detection products orservicesrelated to ingredients production andanimalfood goods Activities interpreting andanalyzingdata. be integratedandcapableofcollecting, management software andsystemsmust resources management.Theresources software developmentprocesses for Project mustincludesystemsand 3. 2. 1. provided. agricultural products mustbe residue inspectionservices for Inspection, gradingandpesticide silos. auction center, coldstorageand for agriculturalexhibitionortrade, land area. Spacemustbeallocated not belessthan60%ofthetotal related toagriculturalgoods must The area foroperationsand services rai. Total area mustnotbelessthan50 Conditions Incentives (no cap) B 1 A 3 A 3 Section 2:Mineral,CeramicsandBasicMetals 2.1 2.2 2.5 2.4 2.3 Prospecting ofminerals Potash miningand/ordressing Manufacture offire-resistant Manufacture ofglassorceramic Manufacture ofadvancedornano aerated, andlightweightbrick) materials orheatinsulation (except 2.4.3 2.4.2 2.4.1 products 2.3.2 2.3.1 from advancedornanomaterials materials orproducts produced tiles) earthenware and ceramic Products (except Manufacture ofCeramic Products Manufacture ofGlass Quality GlassProducts Manufacture ofSpecial or NanoMaterials produced from Advanced Manufacture ofProducts project Materials withinthesame from AdvancedorNano manufacturing process Materials withcontinued Advanced orNano products produced from or NanoMaterials Manufacture ofAdvanced Activities 2. 1. application. to submissionofinvestmentpromotion sublease licensesmustbeobtainedprior Mining licenses(Prathanabat)ormining Not eligibleformerit-based incentives. Project musthavefiringprocess. annealing process. Project musthavemeltingand/or annealing process. Project musthavemeltingand/or incentives. Not eligibleformerit-based investment promotion application. obtained priortosubmissionof Special Atchayabat:SA)mustbe Prospecting Atchayabat: EPA or Atchaybat: PA orExclusive Prospecting licenses(Prospecting Conditions A GuidetotheBoard ofInvestment2017 Incentives B 1 B 1 B 1 B 1 B 2 A 2 A 3 A 3 31 General List of Activities Eligible for Investment Promotion 32

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 2.6 2.8 2.7 2.9 Manufacture ofgypsumboard or Manufacture ofintermediatesteel, Manufacture ofup-stream steel,i.e. gypsum products 2.9.7 i.e. Slab,BilletandBloom Briquetted Iron (HBI) Direct ReductionIron (DRI)andHot hot metal,pigiron, spongeiron, 2.9.6 2.9.5 2.9.4 2.9.3 2.9.2 2.9.1 Manufacture ofdown-stream steel

coated steelsheets cold rolled steelsheetsand sheets, steelplates,hotor cold rolled stainlesssteel construction use,i.e.hotor steel products for Manufacture offlatrolled Black Plate Manufacture ofTinMill steel sheets steel sheetsandcoated plates, hotorcoldrolled stainless steelsheets, use, i.e.hotorcoldrolled steel products forindustrial Manufacture offlatrolled wires, shaftsandbars use, i.e.steelwire rods, products forconstruction Manufacture oflongsteel shafts andbars i.e. steelwire rods, wires, products forindustrialuse Manufacture oflongsteel within thesameproject and intermediatesteel manufacturing ofupstream process from continuous production stream steelwith Manufacture ofdown- Tensile Strength Steel Manufacture ofHigh Activities Not eligibleformerit-basedincentives. (UTS) ofproduct mustexceed700MPa. The valueofUltimateTensile Strength 2. 1. Intermediate steelproduction only. the sameproject. manufacturing ofup-stream steelin production process from Intermediate steelwithcontinuous Conditions Incentives B 1 B 1 B 2 A 4 A 4 A 2 A 2 A 3 A 2 A 4 A 2 2.12 2.11 2.13 2.10 2.16 2.15 2.14 2.17 Manufacture offerro-alloy Manufacture ofmetalpowder Manufacture ofcastiron/steel parts Manufacture ofsteelpipesor Coil center Rolling, drawing,castingorforging Manufacture offorged iron/steel Manufacture ofconstruction (except ShotBlasting) 2.9.8 2.13.2 2.13.1 2.10.2 2.10.1 stainless steelpipes of non-ferrous metals parts concrete forpublicutilities materials andpre-stressed Sheet Rolled ElectricalSteel Manufacture ofCold- Other caststeelparts Ductile caststeelparts Other steelpipes semi-seamless steelpipes Seamless steelpipesand Activities (GO) only. Non-oriented (NO)andGrain-Oriented production process. Project inthe mustuseinductionfurnace Not eligibleformerit-basedincentives. 2. 1. before 31December, 2018. Application mustbesubmitted Special EconomicZone(SEZ). Project mustbelocatedinthe Conditions A GuidetotheBoard ofInvestment2017 Incentives B 1 B 2 A 3 A 4 A 3 A 3 A 4 A 3 A 3 A 2 A 2 33 General List of Activities Eligible for Investment Promotion 34

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 Section 3:LightIndustry 3.1 Manufacture oftextileproducts or 3.1.3 3.1.2 3.1.1 parts finishing, orprinting finishing, orprintingand Bleaching, dyeingand 3.1.2.2 3.1.2.1 fabric Manufacture or ofyarn 3.1.1.3 3.1.1.2 3.1.1.1 synthetic fibers Manufacture ofnaturalor Activities fabric or other yarn Manufacture of functional fabric or functional yarn Manufacture of other fibers Manufacture of recycled fiber Manufacture of functional fiber technical fiberor Manufacture of 3. 2. 1. 2. 1. National InnovationAgency. agencies, e.g.ThailandTextile Institute, Projects mustbeapproved byrelated waste only. Projects mustusedomestic scrapsor National InnovationAgency. agencies, e.g.ThailandTextile Institute, Projects mustbeapproved byrelated all areas. printing businesses canbelocatedin For thetextile industry, digital environmental impact. have measures to reduce will bepermitted.Projects mustalso only expansionofexisting projects In caseprojects are notlocatedin1., the MinistryofIndustry. according totheannouncementof protection andcontrol systems treatment andenvironmental industrial zonesthathavewaste in industrialestatesorpromoted Projects mustbelocatedorexpand the first3yearscombined. 0.5% oftheproject’s total revenue of product developmentislessthan investment onresearch, designor product developmentorifthe expenditures onresearch, designor Projects withnoinvestmentor combined. revenue ofthefirst3years than 0.5%oftheproject’s total product developmentofnotless expenditures onresearch, designor Projects withinvestmentsor Conditions Incentives B 1 B 1 A 4 A 3 A 4 A 2 A 3 3.5 3.4 3.3 3.2 Manufacture ofmusical instrument Manufacture ofsports equipment Manufacture ofbagsorshoes Manufacture ofnon-wovenfabric or parts artificial leather products madeofleatheror non-woven fabric or hygienicproducts madeof 3.1.4 household textiles clothing accessories,and Manufacture ofgarments, Activities 2. 1. 2. 1. 5. 4. the first3yearscombined. 0.5% oftheproject’s total revenue of product developmentislessthan investment onresearch, designor product developmentorifthe expenditures onresearch, designor Projects withnoinvestmentor combined. revenue ofthefirst3years than 0.5%oftheproject’s total product developmentofnotless expenditures onresearch, designor Projects withinvestmentsor the first3yearscombined. 0.5% oftheproject’s totalrevenue of product developmentislessthan investment onresearch, designor product developmentorifthe expenditures onresearch, designor Projects withnoinvestmentor combined. revenue ofthefirst3years than 0.5%oftheproject’s total product developmentofnotless expenditures onresearch, designor Projects withinvestmentsor must beusedinallcases. Environment-friendly technology Industry ornot. announcement oftheMinistry according toSection30of the estates orpromoted industrialzones the businessislocatedinindustrial the existingbusinessarea, whether impact are allowedtobelocatedin Efficiency byreducing environmental Promote Improvement ofProduction promotion undertheMeasure to Projects applyingforinvestment Conditions A GuidetotheBoard ofInvestment2017 Incentives B 1 B 1 B 1 B 1 A 4 A 4 A 4 35 General List of Activities Eligible for Investment Promotion 36

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 3.9 3.8 3.7 Manufacture oftoys 3.6 Creative product designand Manufacture ofgemsandjewelry Manufacture offurniture orparts development center and prototype or partsincludingrawmaterials Activities 4. 3. 2. 1. 2. 1. 2. 1. 2.3 2.2 2.1 1.2 1.1 least 1,500,000 bahtperyear. and developmentpersonnel ofat salaries forcreative product design Projects musthaveexpensesfor the project mustbeThai. At least70%oftotalemployees in following components: Projects mustconsistofonethe components, asfollows: Projects mustconsistof2 the first3yearscombined. 0.5% oftheproject’s totalrevenue of product developmentislessthan investment onresearch, designor product developmentorifthe expenditures onresearch, designor Projects withnoinvestmentor combined. revenue ofthefirst3years than 0.5%oftheproject’s total product developmentofnotless expenditures onresearch, designor Projects withinvestmentsor the first3yearscombined. 0.5% oftheproject’s totalrevenue of product developmentisless than investment onresearch, designor product developmentorif the expenditures onresearch, designor Projects withnoinvestment or combined. revenue ofthefirst3years than 0.5%oftheproject’s total product developmentofnot less expenditures onresearch, designor Projects withinvestment or system. user acceptancetesting Prototype standard testingand performance testingsystem Prototype designcreation and Engineering designsystem system. Conceptual designandcreation Information systemfordesign Conditions Incentives B 1 B 1 A 4 A 1 A 4 A 4 3.11 3.10 Manufacture ofmedicaldevicesor Manufacture oflenses 3.11.3 3.11.2 3.11.1 parts 3.10.2 3.10.1 and cottonwool caps, facemasks,gauze fibers, e.g.gowns,drapes, devices madeoffabricsor Manufacture ofmedical fabrics orfibers) medical devicesmadeof medical devices(exceptfor Manufacture ofother sector research collaborative public-private sector research or commercialized from public devices thatare implants) ormedical scan machineand machine, MRICT devices, (e.g.x-ray high-technology medical Manufacture ofhigh-riskor eyeglass framesandparts lenses, cosmetic Manufacture ofsunglass camera lenses cosmetic lenses,e.g. sunglass lensesor are notmedicaldevices, Manufacture oflensesthat Activities cotton yarn. cotton yarn. must startfrom rawcottonfabricor Manufacture ofgauzeorcottonwool 2. 1. 5. innovation In caseprojects includeR&Dand innovation In caseprojects includeR&Dand tax exemptionperiod. 5 yearsaftertheendofitscorporate reduction incorporateincome taxfor will receive anadditional50percent one thatisapproved bytheBoard technology parkpromoted byBOIor Project locatedinthescience and Conditions A GuidetotheBoard ofInvestment2017

Incentives B 1 A 2 A 1 A 4 A 4 A 3 37 General List of Activities Eligible for Investment Promotion 38

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 Transport Equipment Section 4:MetalProducts, Machineryand 4.5 4.4 4.3 4.2 4.1 Manufacture ofmachinery, Manufacture ofmulti-purpose Heat Treatment Surface treatment oranodized Manufacture ofmetalproducts 4.5.1 equipment andparts engines andequipment 4.2.2 4.2.1 purpose) or coloringtreatment fordecoration surface treatment (exceptcoating 4.1.3 4.1.2 4.1.1 including metalparts

with engineering design or automationequipment Automation machineryand/ using BasicTechnologies or changingthesurface Plating, Coating,modifying Technologies using Advanced or changingthesurface Plating, Coating,modifying including othermetalparts Other metalproducts parts Metal products ormetal alloy powder Products from metalor Activities 2. 1. heat treatment. Cyanide isprohibited intheprocess of anodizing, etchingandengraving. must havethefollowingprocess, e.g. For anodizedsurfacetreatment, project 2. 1. stamping withinthesameproject. forging process, i.e.machiningand oriron/steel(using inductionfurnace) continuing from iron/steel castingprocess Project musthavemetalforming process Project musthavesintering process. or equipment. Assembling ofmultipurposeengine connecting rod, pistonandflywheel. crank case,crankshaft,camshaft, main engineparts,e.g.cylinderhead, Project musthaveformingprocess of stamping. Forming process, i.e.machiningand project. non-ferrous metalwithinthesame pressing, pullingcastingorforging of Continuous formingprocess from Conditions Incentives B 1 B 1 B 1 B 1 A 4 A 4 A 4 A 4 A 3 A 3 4.7 4.6 Manufacture ofautomobile engines Manufacture ofgeneralautomobile 4.7.1 4.5.4 4.5.3 4.5.2 engines Manufacture ofautomobile and/or AutomationParts Automation Equipment Assembling ofRobotsor and machineryequipment Assembling ofmachinery mould anddie parts and/orrepair of Machinery, equipmentand 4.5.1.2 4.5.1.1 Activities systems using embedded control systems operational process of design and engineering equipment with automation machinery and/or automation Manufacture of systems using embedded control systems operational process of well asdesign Integration, as Systems Automation process of and design design, develop engineering equipment with automation machinery and/or automation Manufacture of 2. 1. Not eligibleformerit-basedincentives. as approved bytheBoard. Projects musthaveassemblingprocess and/or withengineeringdesign. Projects musthavepartformingprocess Must involve engine assembly. and ConnectingRod. Cylinder Block,Crankshaft, Camshaft parts asfollows:CylinderHead, Must havenotlessthan4 out of5 Conditions A GuidetotheBoard ofInvestment2017 Incentives B 1 A 1 A 2 A 3 A 3 A 4 A 3 A4 39 General List of Activities Eligible for Investment Promotion 40

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 4.8 Manufacture ofvehicleparts 4.8.2 4.8.1 4.7.2 4.8.2.3 Regenerative 4.8.2.2 4.8.2.1 parts safety andenergy-saving Manufacture ofautomobile 4.8.1.4 4.8.1.3 Automotive 4.8.1.2 4.8.1.1 including: parts using hightechnology Manufacture ofvehicle engines Manufacture ofmotorcycle 4.8.2.5 Autonomous 4.8.2.4 Activities Braking System Control (ESC) Electronic Stability (EBD) Distribution Force Electronic Brake System (ABS)or Anti-Lock Brake Unit (ECU) Electronic Control Transmission Injection System Electronic Fuel Converter Catalytic Substrate for Braking System Emergency Idling StopSystem 2. 1. 1.2 1.1 Must involveengineassembly. and ConnectingRod. Cylinder Block,Crankshaft,Camshaft parts, asfollows:CylinderHead, Must havenotlessthan4outof5 capacity of500cc.ormore. engines thathaveacylinder 6 partsformanufacturingof Must havenotlessthan2outof but notexceeding500cc. capacity startingfrom 248cc. engines thathaveacylinder 6 partsformanufacturing Must havenotlessthan4outof Conditions Incentives A 3 A 4 A 2 A 2 4.8.3 4.8.4 4.8.3.6 4.8.3.5 4.8.3.4 4.8.3.3 Air-condition 4.8.3.2 4.8.3.1 Battery Vehicles (PHEV) and Plug-inHybridElectric Hybrid, ElectricVehicle (EV) Manufacture ofpartsfor for vehicles Manufacture ofrubbertires 4.8.3.13 4.8.3.12 4.8.3.11 4.8.3.10 4.8.3.9 4.8.3.8 4.8.3.7 Activities Manufacture of Units (DCU) Drive Control Manufacture of Systems (BMS) Management Battery Manufacture of system Traction Motor buses battery electric front/rear axlesfor Manufacture of Development Charging System EV Smart Breakers Electrical Circuit Manufacture of Vehicle Chargers Portable Electric Manufacture of Inverters Manufacture of DC/DC Converters Manufacture of plugs andsockets Connectors with Manufacture ofEV On-Board Chargers Conditions A GuidetotheBoard ofInvestment2017 Incentives A 2 A 2 A 2 A 2 A 2 A 2 A 2 A 2 A 2 A 2 A 2 A 2 A 2 A 2 A 2 41 General List of Activities Eligible for Investment Promotion 42

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 4.8.6 4.8.5 4.8.7 4.8.6.10 4.8.6.9 4.8.6.8 4.8.6.7 4.8.6.6 4.8.6.5 4.8.6.4 4.8.6.3 4.8.6.2 4.8.6.1 System Partsincluding 4.8.5.4 4.8.5.3 4.8.5.2 4.8.5.1 System Partsincluding Manufacture ofFuel System Partsincluding Manufacture ofEngine 4.8.6.11 Manufacture ofTransmission Activities Differential Transmission Case Universal Join Driver Shaft Propeller Shaft Carrier Torque Converter Transfer Case Shift Gear Ring Gear Sun Gear Fuel Pipe/Tube Injector Injection Pump Fuel Pump

the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartforming process Conditions Incentives A 3 A 4 A 3 4.8.8 4.8.7.14 4.8.7.13 4.8.7.12 4.8.7.11 4.8.7.10 Gear 4.8.7.9 4.8.7.8 4.8.7.7 4.8.7.6 4.8.7.5 4.8.7.4 4.8.7.3 4.8.7.2 4.8.7.1 4.8.8.4 4.8.8.3 4.8.8.2 4.8.8.1 Parts including Manufacture ofSafety Activities Housing and Bearing Turbine Housing Turbine Blade, Rocker Arm orparts Alternator Parts Starting Motoror Piston Valve Connecting Rod Camshaft Crankshaft Cylinder Block Cylinder Head Parts including Turbocharger Turbocharger and Retractor Belts, i.e.Interlock Parts forSafety Coolant Filters i.e. Initiatorsand Parts forAirBags, Gas Generant Gas Generators, Air BagsInflator, Belts Air Bags/Safety Waste Gate Actuator the Board. and assemblingprocess asapproved by Projects musthavepartforming process Conditions A GuidetotheBoard ofInvestment2017 Incentives A 4 A 4 A 3 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 3

43 General List of Activities Eligible for Investment Promotion 44

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 4.8.13 4.8.12 4.8.11 4.8.10 4.8.9 4.8.13.1 System Partsincluding Manufacture ofExhaust 4.8.12.1 Water Pump System Partsincluding Manufacture ofCooling 4.8.11.2 4.8.11.1 System Partsincluding Manufacture ofSteering 4.8.10.3 4.8.10.2 4.8.10.1 System Partsincluding Manufacture ofSuspension 4.8.9.8 4.8.9.7 4.8.9.6 4.8.9.5 4.8.9.4 4.8.9.3 4.8.9.2 4.8.9.1 System Partsincluding Manufacture ofBrake Activities Steering Rack andPinion Pump Power Steering Leaf /CoilSpring Ball Joint Shock Absorber Brake Drum Brake Set Brake PipeTube Wheel Hub Cylinder Brake Wheel Cylinder Brake Master Brake Caliper Brake Booster Catalytic Convertor the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Project musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Projects musthavepartformingprocess the Board. and assemblingprocess asapproved by Project musthavepartformingprocess Conditions Incentives A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 A 4 4.9 4.11 4.10 Building orrepair ofships Manufacture orrepair ofAircraft, or Manufacture oftrainsorelectric 4.9.1 4.8.17 Manufacture ofothervehicle 4.8.16 Manufacture ofBallBearing 4.8.15 4.8.14 4.11.1 Aerospace DevicesandEquipment 4.10.2 4.10.1 rail system) trains orequipmentparts(only 4.9.2 Building orrepair ofships parts for Vehicles Tensile Strength Steel Manufacture ofUltimate 4.8.14.1 including Conditioning SystemParts Manufacture ofAir 4.8.13.3 4.8.13.2 components equipment and other (e.g. Flightrecorder, Radar), Propeller), appliance (e.g. Engineandparts, airframe, criticalparts Aircraft Partssuchas Manufacture ofAircraft or or parts(onlyrailsystems) electric trainsorequipment Restoration oftrains, or parts(onlyrailsystems) electric trainsorequipment Manufacture oftrains, and equipment) ships withinstalledengine (only steelorfiberglass less than500tonsgross Building orrepair ofships not lessthan500tonsgross Activities Air Compressor Exhaust Manifold Exhaust Catalyst

Projects mustmanufacture steelball. MPa. Strength (UTS)Steelhigherthan700 Projects mustuseUltimateTensile the Board. and assemblingprocess asapproved by Projects musthavepartforming process the Board. and assemblingprocess asapproved by Project musthavepartforming process technology Overhaul andrepair usingadvanced years from startingdateofoperation. Projects mustobtainISO14000within2 Conditions A GuidetotheBoard ofInvestment2017 Incentives B 1 A 4 A 4 A 4 A 4 A 3 A 2 A 2 A 2 A 1 45 General List of Activities Eligible for Investment Promotion 46

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 4.12 Manufacture ofmotorcycles 4.11.5 4.11.4 4.11.3 4.11.2 displacement) (except lessthan248ccengine 4.11.6 supplies) aircraft utilitiesand disposable andreusable and Equipment(except Repair ofOnboard Devices parts. Repair ofAircraft orAircraft galley, etc. seats, lifevests,trolley, and supplies)suchas reusable aircraft utilities (except disposableand devices andequipment Manufacture ofOnboard instruments, etc. nautical systemsand guidance, aeronautical, detection, navigation, Systems suchassearch, Aerospace Operating and auxiliaryequipment,etc. vehicles/propulsion units rockets/spacecraft/ space equipment related to such asdevicesor Devices andEquipment Manufacture ofAerospace Activities 3. 2. 1. Organization). Technology DevelopmentAgency(Public such asGeo-InformaticsandtheSpace Must beapproved byrelated agencies Organization). Technology DevelopmentAgency(Public such asGeo-InformaticsandtheSpace Must beapproved byrelated agencies 1.2 1.1 Board. submitted and approved bythe and utilizationofpartsmust be Investment planformanufacturing process andspraypaintingprocess. Project musthavestructuralwelding and ConnectingRod Crankshaft, Crankcase,Camshaft Cylinder Head,Block, engine parts,asfollows: Project musthaveformingprocess of forming of2out6parts. displacement, project musthave with more than500ccengine For manufacturingofmotorcycles of notlessthan4out6parts. cc, project musthaveforming displacement butlessthan500 with more than248ccengine For manufacturingmotorcycles Conditions conditions conditions Incentives follow follow (must (must 2-3) 1-3) A 1 A 1 A 4 A 3 B1 A3 A2 4.15 4.14 4.13 4.16 Manufacture ofscienceequipment Fabrication industryorplatform Manufacture ofFuelCells Manufacture ofHybridElectric 4.15.1 4.14.2 4.14.1 repair forpetroleum industry Vehicles (HEV)andparts 4.15.2 petroleum industry platform repair for Fabrication industryor engineering design platform repair with Fabrication industryor Other scientificequipment high technology Scientific equipmentusing Activities 5. 4. 3. 2. 1. measure andcontrol theparameter. and self-report theresult orautomatically measure parametervalue,process data Scientific equipmentmustbeableto December 31,2017. Application mustbesubmitted by appropriate. not beextended,exceptdeem it machinery importationperiod shall Certificate. Furthermore, the issuance dateoftheBOIPromotion key partwithinthree yearsfrom the production orusageofatleastone Vehicle Assemblyandkeyparts standards incategoriesL,MorN. with UNRegulationsType Approval Manufactured vehiclesmustcomply or DriveControl Units(DCU),etc. Battery ManagementSystems(BMS) e.g. Batteries,Traction Motors, parts mustbemanufactured orused At least1outofthefollowing4key percent ofThaishareholders. suppliers withnotlessthan51 training andsupportplanforlocal plan forusedbatteriesandtechnical sourcing plan,wastemanagement general partsproduction and assembly planinthe1 plan formachinery, avehicle project, theimportandinstallation key partsproduction orsourcing consisting ofvehicleassemblyand Must propose anintegratedpackage Conditions A GuidetotheBoard ofInvestment2017 st –3 rd years, Incentives A 4 A 3 A 2 A 3 A 2 47 General List of Activities Eligible for Investment Promotion 48

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 4.17 Manufacture ofPlug-InHybrid Electric Vehicles (PHEV)andparts Activities 1. 6. 5. 4. 3. 2. 1. plan inthe1 plan formachinery, avehicleassembly project, theimportandinstallation key partsproduction orsourcing consisting ofvehicleassemblyand Must propose anintegrated package plan inthe1 plan ofmachinery, vehicle assembly project, theimportandinstallation key partsproduction orsourcing consisting ofvehicleassemblyand Must propose anintegratedpackage Additional incentives December 31,2017. Application mustbesubmittedby appropriate. be extended,exceptdeemit machinery importationperiodshallnot Certificate. Furthermore, the issuance dateoftheBOIPromotion key partwithinthree yearsfrom the production orusageofatleastone Vehicle Assemblyandkeyparts standards incategoriesL,MorN. with UNRegulationsType Approval Manufactured vehiclesmustcomply Control Units(DCU),etc. Management Systems(BMS)orDrive e.g. Batteries,Traction Motors,Battery parts mustbemanufactured orused At least1outofthefollowing4key than 51percent ofThaishareholders. plan forlocalsupplierswithnotless and technicaltrainingsupport management planforusedbatteries production andsourcing plan,waste than 51percent ofThaishareholders. plan forlocalsupplierswith notless and technicaltraining support management planforused batteries production andsourcing plan,waste - - - - in theEco-carannouncement with theenvironmental specifications manufactured vehiclesmustcomply For thedomesticmarket,any actual production oftheEco-car. Vehicles (HEVs)produced asthe production ofHybridElectric investor isallowedtocountthe In thecaseofEco-carproject, the Conditions st st –3 –3 rd rd years,generalparts year, generalparts Incentives 4.18 Manufacture ofBatteryElectric Vehicles (BEVs)andparts Activities 1. 6. 5. 4. 3. 2. 6.2 6.1 plan inthe1 plan ofmachinery, vehicle assembly project, theimportandinstallation key partsproduction orsourcing consisting ofvehicleassemblyand Must submitanintegratedpackage Additional incentives December 31,2018. Application mustbesubmittedby appropriate. extended, exceptdeemit importation periodshallnotbe Nonetheless, themachinery BOI Promotion Certificate. years from theissuancedate ofthe part mustcommencewithinthree production orsourcing ofatleastone Vehicle Assemblyandkeyparts standards incategoriesL,MorN. with UNRegulationsType Approval Manufactured vehiclesmustcomply or DriveControl Units(DCU). Battery ManagementSystems(BMS) e.g., Batteries,Traction Motors, parts mustbemanufactured orused, At least1outofthefollowing4key shareholders. not lessthan 51 percent ofThai support planforlocalsuppliers with batteries andtechnicaltraining, and waste managementplanfor used parts production andsourcing plan, the Eco-carannouncement. environmental specificationsin vehicles mustcomplywiththe market, themanufactured the production inthedomestic production oftheEco-car. For produced astheactual Electric Vehicles (PHEVs) production ofPlug-InHybrid investor isallowedtocountthe For anEco-carproject, the must notexceed6years. but thetotalexemptionperiod production ofkeypartannually received foreachadditional income taxexemptionshallbe additional yearofthecoporate more thanonekeypart, For project whichproduces Conditions st –3 A GuidetotheBoard ofInvestment2017 rd years,general Incentives A 3 49 General List of Activities Eligible for Investment Promotion 50

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 4.19 Manufacture ofBatteryElectric Buses andparts Activities 6. 5. 4. 3. 2. 1. 4.3 4.2 4.1 Additional incentives December 31,2018. Application mustbesubmittedby Schedules are asfollows: standards incategoriesL,MorN. with UNRegulationsType Approval Manufactured vehiclesmustcomply Control Units(DCU). Management Systems(BMS)orDrive Batteries, Traction Motors,Battery must bemanufactured orused,e.g., At least1outofthefollowingparts vehicle assemblyplaninthe1 installation planformachinery, or sourcing project, theimportand assembly andkeypartsproduction consisting ofproject vehicle Must submitanintegratedpackage percent ofThaishareholders. suppliers withnotlessthan 51 training andsupportplanfor local plan forusedbatteriesand technical sourcing plan,wastemanagement years, generalpartsproduction and key partmustbecommenced. manufacturing ofatleastone Promotion Certificate,the issuance dateoftheBOI Within sixyearsfrom the commence. Electric Vehicles (BEVs)must assembling oftheBattery Promotion Certificate,the issuance dateoftheBOI Within three yearsfrom the change. prospects ofacceptancethe reason andreasonable not beextendedwithoutavalid machinery importingperiodwill under theboard’s decision.The allowed formarkettesting exemption ofimportdutiesis import ofCBUwiththe Promotion Certificate,the issuance dateoftheBOI Within twoyearsfrom the Conditions st –3 rd

Incentives A 4 Activities 5. 4. 3. 2. six years. exemption periodmustnotexceed income taxexemption,butthetotal additional yearofthecorporate or usageshallbegrantedone Each additionalkeypartproduction Additional incentives December 31,2018. Application mustbesubmittedby extended withoutavalidreason. importation periodshallnotbe Certificate. Inaddition,themachinery date oftheBOIPromotion within three yearsfrom theissuance production orsourcing mustproceed Vehicle Assemblyandkeyparts Control Units(DCU). Management Systems(BMS)orDrive Batteries, Traction Motors,Battery be manufactured orused,e.g., At least1outoffollowingpartsmust Conditions A GuidetotheBoard ofInvestment2017 Incentives 51 General List of Activities Eligible for Investment Promotion 52

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 Industry Section 5:Electronics andElectricalAppliances 5.2 5.1 Manufacture ofpartsand/or Manufacture ofelectricalproducts 5.2.3 5.2.2 5.2.1 products equipment usedforelectrical 5.1.3 5.1.2 5.1.1 appliances motors forelectrical compressors and/or Manufacture of Manufacture ofLEDlamps 5.2.1.2 5.2.1.1 inverters Manufacture ofpower electrical products Manufacture ofother drying machines freezers, washingand conditioners, refrigerators, Manufacture ofair products technology electrical Manufacture ofadvanced Activities inverters other power Manufacture of industrial use power invertersfor Manufacture of 2. 1. manufacturing process. Product designmustbeincludedinthe institutions. equivalent standards from acknowledged from theMinistryofEnergy orother Energy Efficiency Label(Label No.5) Efficiency Standards andhavetheHigh Products mustmeetThailand’s Energy 2. 1. the manufacturing process. product designmustbeincludedin For theproduction ofmotors, acknowledged institutions. equivalent standards from the MinistryofEnergy orother Efficiency Label(LabelNo.5)from Standards andhavetheHighEnergy that meettheEnergy Efficiency conditioners, freezers, refrigerators The compressors mustbeforair functions allow formore complexorvarietyof systems orembeddedsoftware to processing systems,embedded circuits oroperationcontrol systems, The electricalproducts musthave ofThings;or to connectInternet The electricalproducts mustbeable Conditions Incentives B 1 A 4 A 4 A 4 A 3 A 4 A 3 5.3 Manufacture ofelectronic products 5.3.7 5.3.6 5.3.5 5.3.4 5.3.3 5.3.2 5.2.6 5.2.5 5.2.4 5.3.1 Manufacture oftelecommu electronic products Manufacture ofother electronics Manufacture ofoffice products foroffices Manufacture ofaudiovisual control equipment Manufacture ofsecurity agricultural use instruments forindustrial/ control andmeasurement Manufacture ofelectronic 5.3.2.2 5.3.2.1 nication products 5.2.6.2 5.2.6.1 Density Energy Storage Manufacture ofHigh electrical products or equipmentforother Manufacture ofpartsand/ harnesses Manufacture ofwire printed electronics (OPE) Manufacture oforganic and Activities nication products other telecommu- Manufacture of systems communication and wireless used infiber-optic reception devices transmission and emission, Manufacture of Supercapacitor Battery High Density - must beapproved bytheBoard. Specific powerandnumberofcycles must beapproved bytheBoard. Specific powerandnumberofcycles Conditions A GuidetotheBoard ofInvestment2017 Incentives B 1 B 1 B 1 A 4 A 4 A 2 A 2 A 3 A 2 A 2 A 2 A 2 53 General List of Activities Eligible for Investment Promotion 54

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 5.4 Manufacture ofpartsand/or 5.4.6 5.4.5 5.4.4 5.4.3 5.4.2 5.4.1 products equipment usedforelectronic 5.4.6.1 disk drive drive and/orpartsforhard Manufacture ofhard disk security control equipment Manufacture ofpartsfor industry devices andautomotive use, medical/scientific for industrial/agricultural instruments measurement electronic control and Manufacture ofpartsfor 5.4.3.2 5.4.3.1 products telecommunication Manufacture ofpartsfor solar cells and/or rawmaterialsfor Manufacture ofsolarcells electronics (OPE) organic andprinted Manufacture ofpartsfor Activities peripherals) plates or top covers,base parts (excluding disk drivesand/or technology hard advanced Manufacture of tion products telecommunica- parts forother Manufacture of systems communication and wireless used infiber-optic reception devices transmission and parts foremission, Manufacture of 2. 1. be approved bytheBoard. yield fortheproduction ofsolarcellsmust The manufacturingprocess andenergy investment. machines shall notberegarded asan The originalcost ofexisting corporate incometaxexemption cap. account inthecalculation of investment andwillbetaken into machines shallberegarded asan The costofrefurbishment ofexisting per square inch. must notbelessthan2,000gigabits The areal densityofhard diskdrives Conditions Incentives A 2 A 2 A 2 A 3 A 2 A 2 A 2 5.4.12 5.4.11 5.4.10 5.4.9 5.4.8 5.4.7 boards and/orparts multi-layer printedcircuit printed circuits and/or Manufacture offlexible displays Manufacture offlatpanel integrated systems devices and/orforphotonic and/or partsforphotonic Manufacture ofequipment parts forsemiconductors semiconductors and/or Manufacture of products equipment forsolar-powered Manufacture ofpartsand/or state drives drives and/orpartsforsolid Manufacture ofsolidstate 5.4.6.3 5.4.6.2 Activities hard diskdrives peripherals for plates or top covers,base Manufacture of peripherals) plates or covers, base (excluding top and/or parts hard diskdrives Manufacture of approved bytheBoard. The manufacturingprocesses mustbe approved bytheBoard. The manufacturingprocesses mustbe as aninvestment existing machinesshallnotberegarded tax exemptioncap.Theoriginalcostof in thecalculationofcorporateincome investment andwillbetakenintoaccount machines shallberegarded asan the costofrefurbishment ofexisting For theproduction ofintegratedcircuits, as aninvestment. existing machinesshallnotberegarded tax exemptioncap.Theoriginalcostof in thecalculationofcorporateincome investment andwillbetakenintoaccount machines shallberegarded asan The costofrefurbishment ofexisting as aninvestment. existing machinesshallnotberegarded tax exemptioncap.Theoriginalcostof in thecalculationofcorporateincome investment andwillbetakenintoaccount machines shallberegarded asan The costofrefurbishment ofexisting Conditions A GuidetotheBoard ofInvestment2017 Incentives A 3 A 3 A 3 A 3 A 3 A 2 A 4 A 3 55 General List of Activities Eligible for Investment Promotion 56

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 5.5 Manufacture ofmaterialfor 5.5.2 5.5.1 microelectronics 5.4.19 5.4.18 5.4.17 5.4.16 5.4.15 5.4.14 5.4.13 based Manufacture ofmaterial Manufacture ofwafers other electronic products Manufacture ofpartsfor office electronics Manufacture ofpartsfor audio visualproducts Manufacture ofpartsfor components Manufacture ofpassive magnetic products Manufacture ofelectro- (PCBA) circuit board assembly Manufacture ofprinted memory storageequipment Manufacture ofother 5.4.12.2 5.4.12.1 Activities design process without circuit Boards and/orparts Printed Circuit Multi-Layered Circuits and/or Flexible Printed Manufacture of design process parts withcircuit Boards and/or Printed Circuit Multi-Layered Circuits and/or Flexible Printed Manufacture of 2. 1. approved bytheBoard. The manufacturingprocesses mustbe approved bytheBoard. The manufacturingprocesses mustbe investment. shall notberegarded asan The originalcostofusedmachines corporate incometaxexemption cap. account inthecalculation of investment andwillbetaken into machines shallberegarded asan The costofrefurbishment ofexisting be approved bytheBoard. The manufacturingprocesses must Conditions Incentives B 1 A 3 A 2 A 4 A 4 A 4 A 4 A 4 A 4 A 2 A 2 5.7 Software 5.6 Electronics design 5.7.3 5.7.2 5.7.1 5.6.2 5.6.1 - High Value-Added Software digital content Enterprise software and/or Embedded software Embedded systemdesign Microelectronics design Activities analysis and data Develop and provide 1. 4. 3. 2. 1. 3. 2. 1. 1,500,000 baht peryear. salaries forIT-personnel of at least Projects musthaveexpensesfor businesses. revenue ofsuchpromoted business shallberegarded as related toapromoted software provision ofservicesthatare directly Revenue derivedfrom salesorthe withdrawn. income taxexemptionshallbe conditions, one-yearofthecorporate If theproject failstomeetsuch from thefulloperationstart-update. equivalent standard withintwoyears quality standard certificateorany Maturity ModelIntegration(CMMI) from DEPA orreceive aCapability obtain aqualitystandard certificate of landandworkingcapital)must million bahtormore (excludingcost Projects withaninvestmentof10 Agency: DEPA. the DigitalEconomyPromotion development processes specifiedby Projects mustincludesoftware 1,500,000 bahtperyear. salaries forIT-personnel ofatleast Projects musthaveexpensesfor tax exemptionperiod. after theendofitscorporateincome corporate incometaxfor5years Board, 50percent reduction ofthe technology park,promoted bythe If locatedinthescienceand promoted businesses. be regarded asrevenue ofsuch companies orsub-contractors,shall either carriedbythepromoted production forcommercial purposes, which are from downstream related toapromoted businessor provision ofservicesthat are directly Revenue derivedfrom salesorthe per year. personnel ofatleast1,500,000baht salaries forelectronics design Projects musthaveexpenses for Conditions A GuidetotheBoard ofInvestment2017 exemption) income tax (no capfor Incentives corporate A 3 A 1 A 1 A 1 A 1 57 General List of Activities Eligible for Investment Promotion 58

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 5.8 E-commerce 5.9 Digital Services - - - -

etc. DigiTech, MedTech, AgriTech, Digital servicessuchasFinTech, Digital architecture designservice Managed service Software platform - - - Activities support manufacturing software usedto Develop industrial process management including business technology devices, software foradvanced- Develop system security software security andcyber Develop information software predictive analytics data, dataanalyticsand services, includingbig management software 3. 2. 5. 4. 3. 2. 1. 4. Not eligibleformerit-basedincentives. withdrawn. income taxexemptionshallbe conditions, one-yearcorporate the project failstomeetsuch from thefulloperationstartupdate.If equivalent standard withintwoyears quality standard certificateorany Maturity ModelIntegration(CMMI) from DEPA orreceive aCapability obtain aqualitystandard certificate of landandworkingcapital)must million bahtormore (excludingcost Projects withaninvestment of10 Economy andSociety:DE. or approved bytheMinistryofDigital development processes asspecified Projects mustincludesoftware investment promotion. Society before applyingfor Ministry ofDigitalEconomy and Projects mustgainapproval from the businesses. revenue ofsuchpromoted business shallberegarded as related toapromoted digitalservice provision ofservicesthatare directly Revenue derivedfrom salesorthe shall bereduced by1year. the corporateincometaxexemption full operationstart-update,otherwise Technology within2yearsfrom the Information andCommunication approved bytheMinistryof quality standard certificateas certified withISO20000orother of landandworkingcapital)mustbe million bahtormore (excludingcost Projects withaninvestmentof10 processes asapproved bytheBoard. Projects mustincludedigitalservice capital) notlessthan1,000,000baht. (excluding costoflandandworking and havecapitalinvestment Projects musthire digitalspecialists of suchpromoted businesses. business shallberegarded asrevenue related toapromoted software provision ofservicesthatare directly Revenue derivedfrom salesorthe Conditions Incentives B 2 A 3 Section 6:Chemicals,PaperandPlastics 6.7 6.1 6.6 6.5 6.4 6.3 6.2 Manufacture ofplastic packages Manufacture ofindustrial Manufacture ofplasticproducts for Manufacture ofspecialtypolymers Manufacture ofpetrochemicals Oil refinery Manufacture ofeco-friendly 6.7.1 with specialproperties: chemicals industrial goods or specialtychemicals 6.2.2 6.2.1 from eco-friendlypolymers chemicals orpolymersproducts Multilayer plasticpackaging from eco-friendlypolymers Manufacture ofproducts chemicals orpolymers manufacture ofeco-friendly same project asthe incorporated withinthe or polymersthatis from eco-friendlychemicals manufacture ofproducts chemicals orpolymers Manufacture ofeco-friendly Activities plastics. Must integratemore than3layersof Must haveplasticformingprocess. polymers. process usingeco-friendlyplasticsor Must haveplasticformingorcoating 2. 1. promotion. based adhesives,etc.are noteligiblefor insecticides orherbicides,cement compound chemicalfertilizers, products, automobilelubricants, products suchaspaints, cleaning Chemical products, whichare consumer start-up date. (LCA), etc.before thefulloperation such asLifeCycleAssessments standardinternationally-accepted Must beassessedwithan substances. and donotgeneratetoxic be products thatare biodegradable, the production process, ortheymust or usesustainablegreen chemistryin materials from renewable resources, certified orcanbeproved touseraw environment. Theseproducts mustbe throughout theirlifecycles,onthe have lessoverallimpact,assessed The chemicalsorpolymersneedto Conditions A GuidetotheBoard ofInvestment2017 Incentives B 1 B 1 A 3 A 2 A 4 A 3 A 2 A 3 59 General List of Activities Eligible for Investment Promotion 60

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 * Applicationsubmitedby31December, 2017,shallreceive incentive”A2” 6.12 6.11 6.10 6.9 6.8 Manufacture ofpulporpaper Manufacture ofchemical Manufacture ofmedicine Active pharmaceuticalingredients Manufacture ofplasticproducts 6.7.3 6.7.2 6.12.2 6.12.1 fundamental fertilizers from recycled plastic. packaging Antistatic plastics Aseptic plasticpackaging paper Specialty pulporspecialty paper Hygienic pulporhygienic Activities years from thefulloperationstart-update. such asGMPorFoodGrade withintwo Must becertifiedwithrelevant standards full operationstart-update. standardinternational twoyearsfrom the E Class100oraboveanequivalent (Clean Room)orFederalStandard 209 Must becertifiedwithISO14611level5 3. 2. 1. ingredients (APIs). raw materialsofactivepharmaceutical Must beforproduction ofactiveor domestic plasticrawmaterialsonly. Must haveplasticformingprocess using from thefulloperationstart-up date. standardinternational withintwoyears E Class10000oraboveanequivalent (Clean Room)orFederalStandard 209 Must becertifiedwithISO14611level7 the fulloperationstart-update. standardinternational within2years from E Class10000oraboveanequivalent (Clean Room)orFederalStandard 209 Must becertifiedwithISO14611level7 corporate incometaxexemption. investment amounteligiblefor value shallnotbeincludedinthe used inthepromoted project butits projects, existingmachinerycanbe For theimprovement ofexisting the fulloperationstart-update. GMP standard withintwoyearsfrom such promoted projects mustachieve For traditionalmedicineprojects, operation start-update. within twoyearsfrom thefull GMP standard prescribed byPIC/S such promoted projects mustachieve For conventionalmedicineprojects, Conditions Incentives A 3* A 3 A 2 A 2 A 4 A 3 A 3 A 2 6.17 6.16 6.15 6.13 6.14 Manufacture ofpulporpaper,i.e., Manufacture ofplasticproducts for Manufacture ofbodycare products Manufacture paperarticles Production ofprintedmatter paper boxes consumer goods toothpaste andcosmetics such assoap,shampoo, 6.13.3 6.13.2 6.13.1 6.14.2 6.14.1 products performance paper Manufacture ofhigh bio-plastics container coatedwith Manufacture ofpaper from hygienicpaper Manufacture ofproducts matter Production ofprinted matter Production ofdigitalprinted Activities 2. 1. 2. 1. 2. 1. project. using DigitalMediaSoftware inthe Must haveprintinganddesigningprocess shockproof capacity, etc. such asspecialload-bearingcapacityor Must haveanengineeringdesignprocess biodegradable plastic. product coatingprocess using The production process mustcontain start-up date. within twoyearsfrom thefulloperation standard suchasGMPorFoodGrade and mustbecertifiedwithrelevant Must haveahygienicproduction process before 31December, 2018. Applications mustbesubmitted economic zone. Must setupafactoryinspecial before 31December, 2018. Applications mustbesubmitted economic zone. Must setupafactoryinspecial before 31December, 2018. Applications mustbesubmitted economic zone. Must setupafactoryinspecial Conditions A GuidetotheBoard ofInvestment2017 Incentives B 1 A 2 A 2 A 2 A 3 A 4 A 4 A 4 61 General List of Activities Eligible for Investment Promotion 62

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 Section 7:ServiceandPublicUtilities 7.2 7.1 Natural gasstation Public utilitiesandbasicservices 7.1.6 7.1.5 7.1.4 7.1.3 7.1.2 7.1.1 International 7.1.6.1 International Digital Infrastructure Commercial airports for cargo ship Loading/unloading facilities container depots Container yards orinland industrial waterorsteam Production oftapwater, 7.1.1.3 7.1.1.2 7.1.1.1 electricity andsteam Production ofelectricityor Activities circuits” communication high-speed marine energy sources steam from other electricity and electricity or Production of refuse derivedfuel from garbageor biogas, etc.except energy, biomassor energy, wind such assolar renewable energy, steam from electricity and electricity or Production of derived fuel garbage orrefuse steam from electricity and electricity or Production of the Board. technologyapprovedMust usemodern by 2. 1. agencies. Must beapproved byrelevant government (NBTC) before applyingforthepromotion and Telecommunications Commissions and theOffice ofTheNationalBroadcasting from theBroadcasting Commission(BC) high-speed marinecommunicationcircuits Must obtainalicenseforinternational use cleancoaltechnology. If theproject usescoal,itmustonly In caseofcogeneration. Conditions Incentives B 1 A 2 A 1 A 2 A 3 A 3 A 3 A 4 A 4 7.5 7.4 7.3 International headquarters–IHQ International Logistics servicecenters Mass transitsystemsand 7.4.2 7.4.1 7.3.4 7.3.3 7.3.2 7.3.1 transportation ofbulkgoods centers –IDC distribution International Distribution centers:DC Air transportationservices services Maritime transportation (except forwaterpipeline) Pipeline transportation Rail transport Activities 1. 4. 3. 2. 1. date toBOIapplicationsubmissiondate. than 14yearsoldfrom theirmanufacturing Planes intheproject mustbenomore agencies. Must beapproved byrelevant government 2. 3. 3.2 3.1 3.8 3.7 3.6 3.5 3.4 3.3 3.2 3.1 be lessthan10millionbaht. Paid-up registered capitalmustnot not eligibleformerit-basedprivileges. Distribution Center(DC)projects are conditions, asfollows: projects willhaveadditional distributioncenter International computerized system. that iscontrolled byamodern Must provide agoodsstoragefacility not belessthan10millionbaht. The paid-upregistered capitalmust branches inatleastonecountry. in foreign countriesoritsforeign Must superviseassociatedenterprises business, asfollows: Must havebusinessplanandscopeof goods toatleast5countries. The centermustdistribute least 100millionbaht. land andworkingcapital)ofat investment (excludingcostof Must haveaminimum Economic and investment accounting system, etc. financial management,marketing, Business advisoryservices, e.g. and development Human resources andtraining Marketing andsalespromotion Technical support Research anddevelopment parts Procurement ofrawmaterialsand planning management andbusiness Organizational administrationand Conditions A GuidetotheBoard ofInvestment2017 (Exemption Incentives machinery is onlyfor on import activities) R&D and duty on training B 1 B 1 B 1 A 3 A 3 A 2 A 2 63 General List of Activities Eligible for Investment Promotion 64

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 7.7 7.6 Trade andinvestmentsupport tradingcenters:ITC International offices: TISO Activities 2. 1. 2. 1. 4. 2.6 2.5 2.4 2.3 2.2 2.1 3.11 3.10 3.9 as follows: of businessapproved bytheBoard, Must haveabusinessplanandscope baht. expenses mustbeatleast10million Annual salesandadministrative merit-based privileges. ITC projects are noteligiblefor not belessthan10millionbaht. The paid-upregistered capitalmust merit-based privileges. IHQ projects are noteligiblefor (4) Calibration (3) Installation,maintenance and (2) Training services (1) Importingforwholesaling the Board Other servicesasapproved by Treasury center Credit managementandcontrol manufactured inThailand. Wholesaling products equipment, suchas: machinery, engines,toolsand Business activitiesrelated to services. architecture and civilengineering services, exceptthoserelated to Engineering andtechnical sourcing. Information servicesongoods promotion application. submitting theinvestment agenciespriorto government Development orrelated the DepartmentofBusiness obtain businesslicensesfrom engineering businessesmust advertising, architecture and civil exchange. Accounting,legal, securities andforeign currency engaged inbuyingandselling operations, exceptthose Advisory servicesonbusiness associated enterprises. factory buildingtocompany’s providing orlettingoffice or associated enterprisesincluding Monitoring and/orservicing repair Conditions Incentives B 2 B 1 7.9 7.8 Real estatedevelopmentfor Energy ServiceCompany(ESCO) 7.9.1 industrial use 7.9.1.1 estates Industrial zonesorindustrial Activities industrial estates Industrial zonesor 4. 3. 2. 1. promotion application. before submittinganinvestment Must beapproved byMinistryofEnergy 3. 4.1 2.7 Board are asfollows: Other conditionsasspecifiedbythe the Board ofInvestment. designated area mustbeapproved by over 1,000rai,whosefactory- except projects withatotalarea of than 75percent ofthetotalarea, less than60percent andnotmore Factory-designated area mustnotbe be lessthan500rai. Total landarea oftheproject must not arePrakarn noteligible forpromotion. Projects inBangkokandSamut based privileges. projects are noteligibleformerit- Trade andinvestmentsupportoffice (1) Ifthetotalarea isover1,000 The mainroad provided through telecommunication outsourcing whoseservices are businessprocessInternational data processing, etc. services, customer services, sales&marketing services, humanresource services, finance&accounting networks, suchasadministrative emergency stop. wide enoughforan and road shoulderorsurface than 2meterswideeachside and pavementofnotless meters wide,traffic island surface ofnotlessthan14 meters wide,includingroad lanes ofnotlessthan30 rai, theroad musthavefour Conditions A GuidetotheBoard ofInvestment2017

Incentives B 1 A 1 65 General List of Activities Eligible for Investment Promotion 66

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 Activities 4.4 4.3 4.2 4.8 4.7 4.6 4.5 (2) Ifthetotalarea isover500 effluent pool. must haveapost-treatment legal effluent standards. Projects characteristics andaccording to suitable forwastewater Wastewater treatment mustbe each side. not lessthan2meterswide meters wideandashoulderof surface ofnotlessthan8.5 The minorroad musthavea issuance. investment promotion certificate years from thedateof public utilityserviceswithin two or asapproved by theBoard, for 25 percent ofitstotallandarea, The zonemustdevelopabout service andpostoffice. electricity, water, telephone sufficient publicutilities, located inthezonewith The zonemustprovide factories Planning (ONEP). Environmental Policyand Natural Resources and Committee oftheOffice of approved bytheExpertReview impact assessmentreport specified intheenvironmental list offorbiddenindustries, target industries,andnotonthe zones mustbeaccording to Factories locatedinindustrial approved bytheBoard. elimination ofgarbage,as system ofcollectionand Projects musthaveanapproved from rainwaterdischarge system. must becompletelyseparate Wastewater discharge system emergency stop. surface wideenoughforan side andaroad shoulderor less than2meterswideeach wide andpavementofnot of notlessthan7meters wide, includingroad surface road notlessthan20meters must havetwolaneswith and upto1,000rai,theroad Conditions Incentives 7.9.1.5 7.9.1.4 7.9.1.3 7.9.1.2 Activities protection environmental industrial zonefor Industrial estateor (Movie Town) production motion picture Industrial zonefor Logistics Park industrial zones Gem andjewelry promotion application. Industry before submitting theinvestment Must beapproved bytheMinistryof 2. 1. 7. 6. 5. 4. 3. 2. 1. 5. 4. 3. 2. 1. Must provide thefollowingfacilities: lab effects, computeranimation,sound developing andduplicating,special Post production services,i.e.film Indoor studioandoutdoor relevant agencies. government Projects mustbeapproved by capital. 51 percent ofthetotalregistered Thai nationalsmustholdnotlessthan hubs. communication and international that linkthelogisticsparktodomestic provides hi-speedcommunications telecommunication infrastructure that Projects mustinstallmain can handleatleast50containers. terminal andacontainerdepotthat and unloadcontainers,oratruck Projects musthaveastationtoload entirety ofitsarea asaFree Zone. Projects mustdesignatesomeorthe Zone. container depot(ICD)orinaFree customs checkpointandaninland kilometers ofaport,anairport, Must belocatedeitherwithin50 50,000 square meters. sale withatotalarea ofnotlessthan establishing awarehouse forleaseor 200 raiandtheproject mustinvestin The totalarea mustnotbelessthan exhibition hallsandbusinesscenters. Projects musthavemeeting rooms, security systems. Projects mustprovide appropriate gems andjewelry. Projects musthaveasales area for percent ofthetotalarea. jewelry mustnotbelessthan40 Area foroperationsrelated togemsor 100 rai. The totalarea mustnotbelessthan Conditions A GuidetotheBoard ofInvestment2017 Incentives A 3 A 3 A 3 A 3 67 General List of Activities Eligible for Investment Promotion 68

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 7.9.1.8 7.9.1.7 7.9.1.6 Activities (Food Innopolis) Industrial Zones Food Innovation Industrial Estates Industrial Zonesor Aircraft orAerospace City) zones (Rubber Rubber industrial 2. 1. 5. 4. 3. 2. 1. As specifiedbytheBoard. 5. 4. 3. and innovationactivities. the privatesectorinconductingR&D well asstationedtechnicianstosupport for R&Dandinnovationactivities,as equipment andapparatusnecessary Projects musthaveacentrallabwith and innovationcenters. for theprivatesectortoestablishR&D areas (livinglab),andspaceforrent production trialareas, markettesting R&D laboratories,pilotplants, commercial R&Dsuchasoperational infrastructure ready tosupport technology andinnovation Projects musthavethescience, Board ofInvestment. and Technology andtheOffice ofthe approved bytheMinistryofScience Projects mustbelocatedintheareas agencies. Projects mustbeapproved byrelated approved bytheBoard. and anappropriate securitysystemas industrial wastemanagementsystem systems, fire protection system, telecommunications andelectricity wastewater treatment system, prevention systems,waterworks, rainwater drainageandflood utilities andfacilitiessuchasroads, Projects musthavesufficient public centers. and partsmaintenancerepair Projects musthaveanarea foraircraft free zones. its area forbondedwarehouses or Projects mustallocatesome orallof 100 rai. The totalarea mustnotbelessthan regulations. systems inaccordance withthe wastewater andsewagetreatment Projects musthaveappropriate electrical backupsystems. communications systems and as conference rooms, seminarrooms, Projects mustprovide facilitiessuch Conditions Incentives A 3 A 1 A3 7.9.2 7.9.2.3 7.9.2.2 7.9.2.1 technology industrialzones Industrial zonesor Activities Data center Software Parks Technology Parks Science and 5. 4. 3. 2. 1. 4. 3. 2. 1. 4. 3. 2. 1. generators doesn’t function properly. for electricity when oneofthe generator that cansupporttheneed of theDataCenter, withabackup supporting theentire electricityneeds generator, whichiscapableof Must havea“ContinuousRating” (concurrently maintainable). replacement inthesystem. maintenance orduringequipment Must beabletoserviceclientsduring system mustbeatleast60Gbps. and thetotalspeedofwhole Gbps each,foratleast3systems, must haveaspeedofatleast10 domestic telecommunicationsystem centers foratleast4systems.The telecommunication international the datacenterwithdomesticand telecommunications systemlinking Must haveamainhi-speed than 3,000square meters. Area ofdatacentermustnotbeless disaster recovery services(DRS),etc. customer’s serverbackupservice, server co-location,managedservice, for customerslocatedinproject, e.g. Must provide complementaryservices 5,000 square meters. The totalarea mustnotbelessthan supply mustbeinstalled. Continuous back-upofelectricity centers. telecommunication international the software parktodomesticand must haveahigh-speedcablefrom The maintelecommunicationssystem systems throughout thearea. fiber-optic maincommunications Projects musthavehigh-speed approved bytheBoard. Must haveotherfacilities,as backup system. Must haveacontinuouselectricity telecommunications. communications and domestic andinternational systemforboth Must haveamodern Must haveanincubationcenter. Conditions A GuidetotheBoard ofInvestment2017 Incentives A 1 A 1 A 1 69 General List of Activities Eligible for Investment Promotion 70

General List of Activities Eligible for Investment Promotion A GuidetotheBoard ofInvestment2017 7.10 Cloud Service 7.9.2.4 Activities Incubation Center Innovation 3. 2. 1. 6. 5. 4. 3. 2. 1. 12. 11. 10. 9. 8. 7. 6. (cloud service). (cloud security)andISO/IEC 20000-1 Must becertifiedwithISO/IEC 27001 speed. with backupconnectionsat thesame least 10Gbpsforeachconnection, related datacenterswithspeedofat Must haveconnectionsamongall with ISO/IEC27001(datacenter). centers inThailandthatare certified Must belocatedinatleast2data sessions asapproved bytheBoard. technology developmenttraining Projects musthavetechnicalor less than300square meters. The totalservicearea mustnotbe technology community. a technologyecosystemor Projects musthaveplanstoestablish provide businessconsultation. Projects musthavementorsto supply mustbeinstalled. Continuous back-upofanelectricity systems. optic (FTTX)maincommunications Projects musthavehigh-speedfiber (data center). Must becertifiedwithISO/IEC27001 Must havea24-hoursecuritysystem. the entire area. Must havefire prevention systemfor system. conditioning system,withbackup Must haveahighlyefficient air malfunction inanyequipment. to prevent risksfrom damageorany Must haveafailure prevention system distribution system. distribution pathsinelectricity Must havebackupindependent does notaffect service. ensure thefailure inthemainsystem to functionproperly andthismust immediately afteramainsystemfails needs tobeablefunction Cooling. Thissystemorequipment system forUPSITCoolingand Must haveequipmentorbackup Conditions Incentives A 1 A 1 A Guide to the Board of Investment 2017

Activities Conditions Incentives

7.11 Research and development 1. Must have scope of business, as A 1 follows: 1.1 Basic research refers to theoretical or operational activities that are conducted to explore new knowledge from basic natural phenomena and factual observation, without initially considering the application. 1.2 Applied Research refers to research that applies basic knowledge to solve or develop a concept for commercial purpose, with the objective to obtain a new product or process. Applied research includes related activities such as formula development, product design, and production process design for use at an industrial or commercial level. 1.3 Pilot development refers to activities performed to magnify a production scale from basic research and applied research. Pilot development is the development of a prototype and/ or production process testing at a semi-industrial level to test the market and/or collect information on suitable conditions for a production process to use a product design at an industrial level. 1.4 Demonstration development refers to research and development that further develops results from a pilot development in order to test a production process at an industrial level to verify a technology and production process and to demonstrate the level of integrity of such process and viability on a commercial scale production in both quality control and cost estimation.

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Activities Conditions Incentives

2. Must provide the Board with the details and scope of such research and development projects, information on projects’ researchers, including number of researchers, academic profiles and work experiences. 3. Revenues derived from sale of the provision of services that are directly related to a promoted business or which are from downstream production for commercial purposes, either carried by the promoted company or sub- contractor, shall be regarded as revenue of the promoted business. 4. Project located in the science and technology park, promoted by the BOI or one that is approved by the Board will receive an additional 50 percent reduction of corporate income tax for 5 years after the end of its corporate tax exemption period. 5. Must have expenses for salaries of research and development personnel of at least 1,500,000 baht per year.

7.12 Biotechnology 7.12.1 Research and development Projects located in a science and A 1 (R&D) activity and/or technology park, promoted by BOI or one manufacturing of seed that is approved by the Board will receive industry, improvement of an additional 50 percent reduction of plants, animals or corporate income tax for 5 years after the microorganisms using end of its corporate tax exemption period. biotechnology.

7.12.2 Research and development A 1 (R&D) activity and/or manufacturing of biopharmaceutical agents using biotechnology A 1 7.12.3 Research and development (R&D) and/or manufacturing of diagnostic kits for health, agriculture, food and environment A 1

7.12.4 Research and development (R&D) and/or manufacturing of bio-molecules and bioactive substances using microorganisms, plant cells and animal cells

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Activities Conditions Incentives

7.12.5 Manufacture of raw A 1 materials and/or essential materials for molecular biological research and development, experiment, testing or quality control services and/or production of biological substances

7.12.6 Biological substance A 1 analysis and/or synthesis services and/or quality control services and/or product validation services

7.13 Engineering design 1. Projects located in the science and A 1 technology park, promoted by the BOI or one that is approved by the Board will receive an additional 50 percent reduction of corporate income tax for 5 years after the end of its corporate income tax exemption period. 2. Must have expenses for salaries of engineering personnel of at least 1,500,000 baht per year.

7.14 Scientific laboratories Projects located in the science and A 1 technology park, promoted by the BOI or one that is approved by the Board will receive an additional 50 percent reduction of corporate income tax for 5 years after the end of its corporate income tax exemption period.

7.15 Calibration services Projects located in the science and A 1 technology park, promoted by the BOI or one that is approved by the Board will receive an additional 50 percent reduction of corporate income tax for 5 years after the end of its corporate income tax exemption period.

7.16 Product sterilization services A 2

7.17 Recycling and reuse of unwanted 1. Must be approved by relevant materials government agencies. 2. Must be located in an industrial estate or promoted industrial zone. Exceptions to this requirement may be granted by the Board on a case- by-case basis.

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Activities Conditions Incentives

3. Unwanted materials in the project must be generated from domestic sources only. 4. Must have separation or processing of unwanted materials using modern technology, as approved by the Board. 5. Promoted projects will receive rights and privileges, as follows: -- Sorting/separation A 3 -- Sorting/separation with additional A 2 processing of recycling or recovery of valuable substances.

7.18 Waste treatment or disposal Projects must be approved by relevant A 2 government agencies.

7.19 Human Resources Development 7.19.1 Vocational training centers 1. Must teach or train technical courses A 1 in specific fields, including design training center, as approved by the Board. 2. Must have necessary equipment, vocational training lab, and others. 3. Projects located in a promoted science and technology park or one that is approved by the Board will receive an additional 50 percent corporate income tax reduction from net profits for 5 years after the end of corporate income tax exemption period.

7.19.2 High-potential academies High-potential academies A 1 and institutions for higher 1. Must be high-potential academy, education which focuses on science and technology education 2. Must be located in the Eastern Economic Corridor (EEC) or other special economic zones for high- potential academies designated by the Cabinet 3. Must comply with rules and regulations as approved by the Board High-potential institutions for higher education 1. Must be high-potential institutions for higher education. In case of foreign investment, projects must be approved by the Commission for High-potential Foreign Higher Education Institutions

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Activities Conditions Incentives

2. Must be located in the Eastern Economic Corridor (EEC) or other special economic zones for high- potential institutions for higher education designated by the Cabinet or other zones designated by the Commission for High-potential Foreign Higher Education Institutions 3. Must comply with rules and regulations as approved by the Board

7.20 Thai motion picture production 1. Thai motion picture production shall A 3 include production of movies, documentaries or television programs, but does not include production of an advertisement. 2. Revenue exempt from tax shall include: 2.1 Revenue obtained from the sale of copyright, including sale of motion pictures in other forms such as CD, video CD, DVD, etc. 2.2 Revenue obtained from a revenue sharing scheme from movie theaters and motion picture distributor.

7.21 Motion picture support services Motion picture support services shall A 3 include documentaries, television programs, animation and commercials, which have a scope of business, as follows: 1. Rental services of movie production equipment and/or movie production props must have main equipment machinery, such as camera, grip equipment, light set, etc. 2. Film development and duplication services must have main equipment/ machinery, such as film development machine, film duplication machine, digital film duplication machine, etc. 3. Sound recording services must have main equipment/machinery, such as digital sound recorder, digital sound editing machine, digital sound mixing machine, etc.

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Activities Conditions Incentives

4. Picture technical services must have machines and equipment capable of creating special pictures that are not possible with cameras. The service providers must have main equipment and machinery, such as standard definition/high definition digital recorders, editing suites, digital compositing and special effect creation, etc. 5. Coordination services for foreign movie production in Thailand must include coordinating with related government agencies for permits, location scouting and sourcing of staff and movie equipment. 6. Studio rental services for movie and television program production.

7.22 Tourism promotion services 7.22.1 Ferry services or tour boat Must be approved by relevant government A 3 services or tour boat renting agencies

7.22.2 Tour boat port services Must have facilitating equipment, such as A 3 boat lifting equipment, inland boat deck, or boat garage for maintenance purpose.

7.22.3 Amusement parks 1. Must have a minimum investment A 3 (excluding cost of land and working capital) of not less than 500 million baht. 2. The project details must be approved by the Board.

7.22.4 Cultural centers or arts and Must have a minimum investment A 3 crafts centers (excluding cost of land and working capital) of not less than 30 million baht.

7.22.5 Open zoos 1. Must have a minimum investment A 3 (excluding cost of land and working capital) of not less than 500 million baht, with a total area of not less than 500 rai. 2. Project details must be approved by the Board. 3. Fifteen percent of the total area must be allocated as green area and another fifteen percent as car park.

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Activities Conditions Incentives

7.22.6 Aquariums 1. Projects must have a minimum A 3 investment (excluding cost of land and working capital) of not less than 100 million baht. 2. An environmental impact assessment report must be submitted within 12 months after the issuance of its investment promotion certificate.

7.22.7 Race tracks 1. Projects must be approved by A 3 relevant government agencies. 2. Projects must obtain a standard certificate from FIA (Federation Internationale de L’ Automobile) or FIM (Federation Internationale de Motocyclisme). 3. Projects must have appropriate preventive and controlling measures against environmental damage or against danger or trouble to neighbors. 4. An environmental impact assessment report must be submitted within 12 months from the date of issuance of its investment promotion certificate.

7.22.8 Cable cars Projects must be approved by relevant A 3 government agencies.

7.23 Activities to support tourism 7.23.1 Hotels 1. Each hotel must have at least 100 rooms or a minimum investment (excluding cost of land and working capital) of not less than 500 million baht. 2. A promoted hotel will receive its rights and benefits, as follows: -- Promoted hotels located in one of A 4 the 20 special investment promotion provinces. -- Hotels in other provinces are not B 2 eligible for merit-based incentives.

7.23.2 Convention halls 1. Total convention area must not be A 3 less than 4,000 square meters. Total area of the largest hall must not be less than 3,000 square meters. 2. Must have suitable facilities and equipment. 3. Project’s blueprints must be approved by the Board.

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Activities Conditions Incentives

7.23.3 International exhibition 1. Indoor exhibition area must not be A 3 centers less than 25,000 square meters. 2. Every hall must have a business meeting room.

7.23.4 Health rehabilitation centers 1. Must use medical technology for B 1 medical treatment and health rehabilitation. 2. Must have continuous rehabilitation programs, including overnight treatment. 3. Projects are not eligible for merit- based incentives.

7.24 Factory Development for Industrial 1. Project must be located in the Special Plant and Warehouse Economic Zone (SEZ). 2. Application must be submitted before 31 December, 2018.

7.27 Manufacture of Electric Vehicle 1. Must submit a plan for equipment and Charging Stations sourcing of parts. 2. Must submit a plan for the development of EV Smart Charging System. 3. Must have at least four chargers with at least one type of quick charge. 4. Must not obtain any rights or benefits from other government sectors. 5. Must obtain ISO 18000 within three years from the date of the issuance of the BOI Promotion Certificate. 6. Application must be submitted by December 31, 2018.

7.28 Medical services 7.28.1 Traditional Thai medical 1. Must employ officers who received A 3 public services qualifications or professional certificates in Thai Traditional Medicine. 2. The establishment must pass the evaluation in quality standards approved by the Department of Thai Traditional and Alternative Medicine (TTM HA System) at the same level or higher than community hospitals.

7.28.2 Specialty medical centers Provide investment promotion only in A 2 areas with shortages namely, heart related issues (coronary artery disease, heart surgery, and heart failure), cancer related issues (chemotherapy and radiology), and kidney related issues (dialysis center) with the following conditions:

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Activities Conditions Incentives

1. Must have appropriate human resource recruitment plans. 2. Must have tools and equipment that are approved by the Board of Investment. 3. Must receive permission from relevant agencies and must be in accordance with the professional standards, regulations or other relevant standards of the Ministry of Public Health. 4. Must consider the distribution of services and the people’s access to the centers.

7.28.3 Hospitals The eligible areas that can request support A 2 are as follows: 1. Areas under the 20 provinces with low per capita income according to the Announcement of the Board of Investment No. 2/2557 dated December 3, 2014. 2. Areas under the following Southern border provinces: Narathiwat, Pattani, Yala, Satun, and 4 districts in Songkla namely, Jana District, Nathawi District, Sabayoy District, and Tepa District. 3. Special Economic Development Zones

7.28.4 Transportation services for 1. Must receive approval from relevant A 3 patients, doctors, or agencies and operate in accordance medical equipment with their standard regulations with (maritime, land or air regard to transportation services for transport) patients. 2. Must have modern tools and equipment in accordance with the Ministry of Public Health’s standard or other standards approved by the BOI

Remarks: Activities 7.25 and 7.26 have been expired.

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Activities Conditions Incentives

8.1 Targeted core technology 1. Target technology development Exemption development procedures shall be used as a base from 8.1.1 Biotechnology for the manufacturing process or corporate Development service provision in the target income industry as approved by the BOI tax for ten 8.1.2 Nanotechnology 2. There must be a technology transfer years with Development with an educational institution or no limit research institute as approved by the on the 8.1.3 Advanced Material BOI e.g. Technology Research income tax Technology Development Consortium. exempted. 3. Project located in a science and 8.1.4 Digital Technology technology park promoted by the Development BOI or one that is approved by the Board will receive an additional 50 percent reduction in a corporate income tax for 5 years after the end of its corporate income tax exemption period. 4. Project may apply for merit based incentives and be granted the corporate income tax exemption for not exeeding 13 years. 5. Project shall be granted import duty exemption on goods.

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OTHER POLICIES AND SPECIAL MEASURES

Investment Promotion Policy for Industrial Development in Measure for Border Provinces in Southern Thailand and Investment Improvement of Promotion Policy for Industrial Production Efficiency Development for model cities of Border Provinces in 1 Southern2 Thailand Investment Promotion Policy for Investment in Special Economic Development3 Zones

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Measure for Improvement of Production Efficiency

BOI Announcement No.1/2557, regarding promoting and upgrading technology and machinery for energy conservation, alternative energy utilization or reduction of environmental impacts, as well as to encourage research and development and advanced engineering design involvement to improve production efficiency.

This measure is used with: 1. Existing projects, whether BOI or non-BOI promoted. In the case of non-BOI promoted projects the activity must be eligible for investment promotion by the Board of Investment. 2. BOI promoted projects can also apply for this measure when the corporate income tax exemption or reduction period expires, or in case the respective project(s) does not receive a corporate income tax exemption.

Conditions 1. The minimum capital investment must not be less than 1 million Baht (excluding cost of land and working capital). 2. The application must be submitted by December 31, 2017, and project must complete implementation within three years from the date the promotion certificate is issued.

Incentives 1. Exemption of import duty for machinery. 2. 3-year corporate income tax exemption on the revenue of an existing project, accounting for 50 percent of the investment under this measure (excluding cost of land and working capital). 3. Corporate income tax exemption period shall start from the date of revenue derivation after promotion certificate is issued.

1. Measure to promote energy conservation, alternative energy utilization or reduction of environmental impact

The applicant must submit an investment plan for machinery change or upgrade to save energy, to introduce alternative energy into the project, or to reduce environmental impact by implementing one of the following: 1. Project must invest in upgrading machinery to modern technology that reduces energy consumption at the stipulated ratio. 2. Project must invest in upgrading machinery to use alternative energy at the stipulated ratio to total energy consumption. 3. Project must invest in upgrading machinery to reduce environmental impact; namely, reducing waste, waste water or exhaust air, according to the stipulated criteria.

Explanatory (BOI Explanatory No. 4/2557 announced on Nov 25, 2014) 1. Must submit ‘the investment promotion application together with the Supplemental Form for the Application for Investment Promotion in Accordance to Measures to Promote Energy Conservation Alternative Energy Utilization or Reduction of Environmental Impact, based on Board of Investment Announcement No. 1/2557 (F PA PP 28).

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2. Projects with investment capital over 200 million Baht (excluding cost of land and working capital) must prepare additional information for consideration, as follows: • Test result and certificate of machinery and equipment for energy conservation, alternative energy utilization or reduction of environmental impact by a trusted institute, e.g. Department of Science Service or Test results of machinery and equipment that have been used in the operation. • Plan and measurement method for energy conservation or reduction of environmental impact. 3. Must submit the application before the machinery investment. 4. Projects which apply for this measure must not be promoted under the Board of Investment’s Announcement Nos. 3/2550, 2/2552, 4/2552 (except investment promotion measures for target industries), 3/2554, 6/2554 and 1/2556 (except investment promotion measures for target industries) 5. Must follow the investment promotion criteria, as follows: 5.1 Indicator

Indicator

Energy • Energy Consumption must be reduced to stipulated ratio Conservation • The value of conserved energy must not be less than the value of corporate income tax exemption

Alternative • Alternative energy must be utilized in accordance with the Energy type specified to substitute the use of fossil fuel Utilization

Environmental • The amount of air pollution emission, amount of waste water Impact drainage, or amount of pollutants in waste water must be reduced in the appropriate ratio, according to the technology

The year before the application is submitted will be considered the base year. The calculation will start after one year of operation and the production capacity during the base year. 5.2 Scope of Alternative Energy 5.2.1 Identifying the type of alternative energy that creates less environmental impact, e.g. renewable energy 5.2.2 Utilizing the alternative energy within the identified scope instead of fossil fuels (e.g. oil, coal, natural gas) 5.3 Stipulated Ratio for Implementation 5.3.1 1st Indicator: Reducing energy consumption to the stipulated ratio whereby the value of energy conservation must not be less than the amount of the corporate income tax exemption. The guideline for consideration is as follows: (1) Duration used in calculating the value of energy conservation in the promoted project is 5 years. (2) Duration used in calculating the value of the corporate income tax exemption is 3 years. 5.3.2 2nd Indicator: Introducing the use of alternative energy in the project in a significant ratio to total energy consumption.

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5.3.3 3rd Indicator: Reducing the quantity of contaminated water or air in accordance with the criteria set for each case in terms of appropriate technology use, while not specifying a minimum level. 5.4 Ratio of Unit Quantity 5.4.1 The ratio of air pollutant loading Reduction of air pollutant loading: The condensate of each parameter, i.e. dust, sulfur dioxide, etc. and reduction in air contamination will be considered. 5.4.2 The ratio of water pollutant loading Reduction of air pollutant loading: The condensate of each parameter i.e. BOD, COD, each type of heavy metal etc. and reduction of wasted water. 5.5 Scope of Machinery Upgrade 5.5.1 Only new machinery will be counted as a change of machinery, in which the request can be submitted with the investment promotion application of the company or only the part where change in machinery is requested, if the project is in accordance with the criteria and specified indicators. 5.5.2 The change of machinery will be considered in 2 cases: (1) Change of machinery in the manufacturing line e.g. changing equipment or fuel for furnaces in glass products manufacturing line, steam boiler for fiber steaming in continuing manufacturing line, and food processing oven, etc.

(2) Change of supporting machinery e.g. steam boiler used for generating electricity in plants, waste water treatment system, solar cell installation to generate electricity used within the plant instead of buying from electricity distribution system, etc. 5.6 Qualifications of Project Applying for Incentives 5.6.1 The promoted project must not already receive tax incentives for its operation for the same purpose from other agencies 5.6.2 The promoted project must operate its activity in accordance with the criteria and conditions on environmental control and in accordance to those specified by the relevant government agency in which the value of toxins must not exceed that allowed by law.

2. Measure to promote improvement in production efficiency by upgrading technology and machinery for manufacturing

Must submit an investment plan for machinery change or upgrade according to the stipulated criteria; for instance by upgrading a production line to an automated system in order to improve its efficiency.

Explanatory (BOI Explanatory No.3/2557 announced on Nov 25, 2014) 1. Must submit the investment promotion application together with the “Supplemental Form for the Application for Investment Promotion in Accordance to Measures to promote improvement in production efficiency by upgrading technology and machinery for manufacturing” (F PA PP 30). 2. Must submit the application before investment in the machinery. The machinery to be upgraded must be new machinery. Also, this includes upgrading machinery in case no change in production capacity or the production capacity has increased from the improvement in production efficiency.

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3. Projects which apply for this measure must not be promoted under the Board of Investment’s Announcement nos. 3/2550, 2/2552, 4/2552 (except investment promotion measures for target industries), 3/2554, 6/2554 and 1/2556 (except investment promotion measures for target industries) 4. Project must be on the current list of eligible activities for investment promotion for which tax incentives shall be granted. 5. Must follow the criteria for investment promotion under this measure, as follows: 5.1 The scope of upgrading machinery will consider the issue on machinery upgrading together with technology upgrading, as follows: 5.1.1 Upgrading machinery The project must upgrade machinery or install additional machinery to improve production efficiency, e.g. robotic installation and autoloader. Additional equipment or supporting machinery will be considered as necessary and appropriate, e.g. automated silo system. Also, these shall include: (1) Automated quality inspection equipment installation to improve manufacturing efficiency, e.g. the installation of x-ray equipment in an iron sheet manufacturing line to inspect iron sheet quality faster. (2) Managing and supporting manufacturing system (only for manufacturing industry), e.g. manufacturing planning and control system (Including hardware and software), warehouse management system, handling equipment, raw material preparation system, packaging system, e.g. automated goods handling systems installation in warehouse and using automated machinery in goods packaging. In case of upgrading management systems, the upgrade must improve the manufacturing line to become more efficient. This will not include service activities, such as warehouse service. (3) The change of machinery must be included in the investment capital, excluding the change of equipment/spare parts/ and replaceable parts, which is included in the implementation capital and will not include change of machinery or spare parts in case of machinery deterioration. 5.1.2 Upgrading Technology (1) New technology in manufacturing must be introduced in order to improve production efficiency. (2) In case the promoted project is using a new model under the same production technology/same line production with automatic machinery, the production must be in accordance with the specified performance index. (3) In case the promoted project changed the machinery to improve the production efficiency of the promoted product, the change must be in accordance with the specified indicator and can be clearly inspected. 5.2 Key indicator for improving production efficiency

Indicator

Upgrading machinery in • Direct Capital per production unit manufacturing line e.g. robotic • Yield ratio installation and autoloader or • Amount of Processing per Employee updating technology to improve • Overall Equipment Effectiveness (OEE) products.

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The machinery upgrade must be in accordance with the key performance index, which shows the production capabilities or efficiency in manufacturing resources utilization. The indicators are prescribed, as follows: 5.2.1 Direct Capital per production unit 5.2.2 Yield Ratio, e.g. reduction of production loss and reduction in production cycle time 5.2.3 Production efficiency in value and Overall Equipment Effectiveness (OEE) (1) Amount of processing per employee (2) Efficiency of machinery investment ratio (3) Overall Equipment Effectiveness (OEE) (4) Equipment Operating Ratio (EOR) (5) Mean Time between Failures (MTBF) of parts, equipment and machinery (6) Actual Production Rate as a Percentage of the Maximum Capable Production Rate 6. The operation plan must provide information both before and after the upgrade, which must be in accordance with the specified indicators and can be clearly inspected.

3. Measure to promote investment in research and development and advanced engineering designs for efficiency improvement

The measure to promote the investment on research and development and advanced engineering designs for efficiency improvement aims at stimulating and promoting existing projects, both BOI and non-BOI promoted, to invest in research and development and advanced engineering designs for efficiency improvement. For projects applying for the investment promotion, the activity must be eligible for investment promotion as stipulated by the Board of Investment.

Incentive Project with investment capital reaching the specified criteria will be granted 3 years corporate income tax exemption starting from the date the revenue begins after obtaining the promotional certificate. The amount of corporate income tax which will be exempted must not exceed 50 percent of the investment capital in efficiency improvement.

Explanatory (Updated from BOI explanatory No. 1/2557 announced on April 7, 2016) 1. Projects applying for investment promotion must be on the current list of eligible activities for investment promotion and must not be on the list of activities not eligible for merit-based incentives. 2. Applicants for investment promotion incentives must submit an “Application for Investment Promotion,” along with a “Supplemental Form for the Application for Investment Promotion” Under the Measure to Promote Research and Development and Advanced Engineering Designs to Promote Improvement of Production Efficiency, in accordance with the BOI Announcement No. 1/2557 on the Measure to Promote Improvement of Production Efficiency” within December 31, 2017. 3. The applicant must submit an investment plan for research and development of advanced engineering designs according to the stipulated criteria. 4. Project must invest in research and development or advanced engineering designs no less than 1 percent of the total revenue for the first three years from the date of application submission. And for SMEs, projects must invest in research and development or advanced engineering designs no less than 0.5 percent of the total revenue for the first three years from the date the application is submitted.

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5. For the consideration of capital investment or expenditures for research and development and advanced engineering designs, the capital investment or expenditures shall be compared with the total revenue of the promoted project only. 6. Capital investment or expenditures to be considered in the calculation of corporate income tax exemption for this measure must be capital investment or expenditures incurred from the submission date of the supplemental form for the application for investment promotion under the measure to promote research and development and advanced engineering designs for production efficiency, within the stipulated timeframe that is eligible for the corporate income tax exemption incentive.

Characteristics of the investment for research and development and advanced engineering designs for efficiency improvement 1. Investment in research and development refers to, for instance, investment for product development to enhance the quality or usability, or the development of new product prototype models. 2. Investment in advanced engineering designs for efficiency improvement refers to, for instance, designing the production process to be more efficient or reduce wastes from production.

Types of capital investment or expenditures eligible for rights and privileges 1. Research and development in technology and innovation 1.1. In case of in-house or outsourced research and development such as industrial basic research, applied research, experimental development, engineering design, electronics design, must have the scope as following: 1. Theoretical or operational activities that are conducted to explore new knowledge that has economic value or to advance the existing body of knowledge 2. Activities that conduct research on ways to utilize base knowledge 3. Formula development or engineering design and electronics design for the purpose of utilization 4. Production process testing to search for or evaluate alternatives of a new product or new process 5. Engineering design, electronics design, development and testing of prototypes, models and development kits 6. Prototype development 7. Development of pilot production process and pilot plants 8. Technological activities to resolve defects in new products or production processes, as a result of prototype development or pilot production process development 9. Engineering and machinery installation works that are directly related to research and development of new products or production processes, as a result of prototype development or pilot production process development. 10. Engineering design or electronics design for the purpose of creating new products or production processes, as a result of prototype development or pilot production process development 11. Application of basic knowledge to develop new raw materials, tools, products, production processes, systems and services or to enhance the quality and efficiency of existing products/production processes 12. Activities that utilize innovations in products and services which result in new products and services, or result in significant improvement in attributes and utilization, including technical changes, changes in devices or software being used

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1.2. Investment capital or expenditures in research and development consist of following: 1. Wages and salaries - Wages and salaries refer to moneys paid to researchers, assistant researchers, technicians, laboratory analysts, academic specialists involved in the research and development and staff hired specifically to work on the proposed project and also wages and salaries paid to experts or those whose qualifications do not directly meet the requirements for the work but are specially trained for working on the approved project. - Costs incurred in the hiring of consultants or specialists other than those hired to demonstrate equipment or apparatus to work in the approved project.

Wages and salaries specified above include welfare according to the virtue of Section 40(1) of the Revenue Code

2. Costs of equipment or apparatus - Expenses that occur in the procurement and purchase of equipment or apparatus for use in research and development projects specifically, not for regular operation use - Costs of adjustment or repair, calibration of equipment or apparatus for use in the research and development projects, and expenses that result from engineering work such as modification of equipment or apparatus for experiment or testing 3. Costs of construction, renovation or repair of buildings for use as research laboratories 4. Costs of experimental laboratories services such as expenditure on analyses and/or experiments of samples or products 5. Costs of raw or essential materials used in research and development 6. Cost of training sessions or seminars for Thai personnel directly involved in the research and development projects. The training sessions or seminars must be trainings or seminars organized by other organizations both in the country and abroad. Costs of training sessions or seminars include related travel fares (for air fares, only actual fares on economy class will be counted), while excluding daily allowance/food expenses and accommodation. 7. Costs of advanced technology trainings directly related to research and development and advanced engineering designs. The expenses must be incurred from advanced technology trainings directly related to research and development and advanced engineering designs in a project that applies for additional rights and privileges, excluding trainings that concern the conduct of regular work functions. The purpose of the trainings is to promote the transfer of knowledge in technology to Thai personnel. The knowledge obtained from such trainings must be new under the current operational conditions of applicants for additional rights and privileges, and will be applied to develop the technical capacities of Thai personnel. Costs of advanced technology trainings consist of actual expenditures from training sessions or seminars for Thai personnel, be it in-house or organized by other organizations, both in the country and abroad. This includes related travel fares (for air fares, only actual fares on economy class will be counted), while excluding daily allowance/food expenses and accommodation.

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8. Cost of hiring outsourcing research and development in Thailand, which are registered in the Thai research and development database center according to the announcement of the Ministry of Finance on income tax under the list of outsourcing research and development in technology 9. Cost of required license/copyright/intellectual property used in research and development 10. Cost of domestic and overseas IP protection application as a result of research and development on this project (excluding costs of consultants and annual fee for IP protection renewal) 11. Other direct expenses incurred in research and development that do not fall into the above categories, as follows: - Cost of data collection, such as costs of patent search, subscription fees for research journals and research database, etc. Payment for freelance work (when a freelancer gives advice or signs approval on blueprints, applicants must attach their payment of personal income tax as evidence) - Cost of required software license or copyright - Cost of additional premium software support - Cost incurred in outsourcing of experiments, field-testing, sampling and data collection for experiments - Cost incurred in outsourcing marketing and/or economic research to collect data for research and development - Rental cost of experiments, experimental greenhouse and experimental rooms 12. Expenses incurred in supporting personnel working in science, technology and innovation in universities and public research institutes to go work in the private sector, in the fields of research and development, technical problem-solving, evaluation, testing and standard systems and technology management, to enhance competencies in the private sector. The cooperation programs include Talent Mobility and other programs as approved by the Board.

1.3. In the case of joint research and development or advanced engineering designs with overseas institutes 1. Scope of the research and development or advanced engineering designs must comply with details specified in 4.1.1 and must undertake some part of research and development or advanced engineering designs in Thailand. 2. Investment capital and expenditures for additional rights and privileges must comply with details specified in 4.1.2 and only investment expenditures incurred by promoted companies will be counted. 3. Thai personnel must work in research and development or on an advanced engineering designs project abroad for at least 50 percent of the total number of personnel in the promoted project. 2. Expenditures on intellectual property acquisition and/or licensing fees for utilizing technology developed in Thailand in order to improve efficiency in production or services refer to any intellectual property acquisition and/or licensing fees for technology, or technology transfer agreement fees derived from research and development, conducted by Thai national(s) or juristic person(s) with at least 51 percent Thai shareholding, which is warranted under intellectual property laws (such as patents, copyrights, trade secrets, trademarks, plant variety protection and geographical indication, etc.) for efficiency improvement of production or services. Only fees incurred during the period of corporate income tax exemption will be counted.

89 A Guide to the Board of Investment 2017 Investment Promotion Policy for Industrial Development in Border Provinces in Southern Thailand and Investment Promotion Policy for Industrial Development for model cities of Border Provinces in Southern Thailand

To promote investment in the Southern Border Provinces, and to boost model cities under the slogan “Stable, Affluent and Sustainable Triangle”. The Broad also wants to promote investment on private sectors in order to generate incomes toward people in border provinces in Southern Thailand that can lead to economic expansion in the future. The investment criteria will be showed as follow:

Investment Promotion Policy for Investment Promotion Policy for Industrial Development for model Industrial Development in Border cities under the slogan “Stable, Provinces in Southern Thailand Affluent and Sustainable Triangle”

1. Area Southern Border Provinces refers to 1. Nong Chik Distric, Pattani to be 1. Narathiwat the model city of Agricultural 2. Yala Development Industry City 3. Satun 2. Betong Distric, Yala to be the 4. Songkhla model city of Sustainable 5. Four Districts in Songkhla which Development City consist of Jana District, Natawee 3. Su-ngai Kolok District, Narathiwat District, Saba Yoi District and to be the model city of Taypa District International Border City

2. Activities Activities under BOI Announcement - Activities under BOI Eligible for No. 2/2557 on December 3, 2014 Announcement No. 2/2557 on Investment (Include the announcements that December 3, 2014 (Include the Promotion alleviate the conditions of some announcements that alleviate the activities) conditions of some activities) - Six additional activities 1) Animal food products and animal food ingredients 2) Manufacture of construction materials, and manufacture of prestressed concrete for public utility (except manufacture of Ceramic tile roof, floor tile and wall tile) 3) Production of body used ingredients (except cosmetics) 4) Production of plastic products for consumption goods 5) Production of fiber products 6) Office and building development for industrial use/ warehouses

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3. Existing - All implemented projects, whether promoted or not, in which the activity Investment must be eligible for investment promotion Projects - Activities-based do not necessary to located in the areas according to No.1

4. New - New investment project applying for investment, in which an existing Investment juridical person or a new juridical person, in which the group of owners of Projects the existing project must be the principal shareholders - Activities-based must locate in the areas according to No.1

5. Conditions 1. Minimum capital investment requirement is at least 500,000 baht (Existing (excluding cost of land and working capital) Investment 2. Projects are allowed to utilize domestic used machinery in the promoted Project) project with a value not exceeding 10 million baht and required investment in new machinery must account for at least one fourth of the value of the used machinery 3. Applications must be submitted within December 31, 2017

6. Conditions 1. Minimum capital investment requirement is at least 500,000 baht (New (excluding cost of land and working capital) Investment 2. Projects are allowed to utilize domestic used machinery with a value not Project under exceeding 10 million baht and investment in new machinery must account promoted for at least one fourth of the value of used machinery areas) 3. Applications for existing projects must be submitted when the new projects are complete and ready for commencement of operation 4. Applications for new projects must be submitted within December 31, 2017, with confirmation letter on existing investment

7. Incentives for 8-year corporate income tax exemption (without cap) New Investment Additional 50% reduction of corporate income tax for a period of 5 years Project Double deductions on the cost of Double deductions on the cost of transportation, electricity and water transportation, electricity and water supply for a period of 15 years supply for a period of 20 years

Additional 25% deduction of the cost of installation or construction of facilities

Exemption of import duty on machinery

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90% import duty reduction on raw 90% import duty reduction on raw materials used in manufacturing for materials used in manufacturing for domestic sales for 5 years domestic sales for 10 years

Exemption on import raw materials Exemption on import raw materials used in manufacturing for export for used in manufacturing for export for 5 years 10 years

Permit to bring unskilled foreign labors into the Kingdom on the activities that are eligible for investment promotion

8. Incentives for 3-year corporate income tax 5-year corporate income tax Existing exemption (subject to cap which exemption (subject to cap which Investment accounts for 100% of investment accounts for 100% of investment Project capital in new projects) capital in new projects)

Other similar incentives as investing in existing projects

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Investment Promotion Policy for Investment in Special Economic Development Zones (see map on page 19)

In order to create economic connectivity with neighboring countries and support integration of the ASEAN Economic Community, the Board has issued Announcement of the Board of Investment No.4/2557, Investment Promotion in Special Economic Development Zones especially border areas both in and around industrial estates which will be granted incentives, as follows:

Incentives for targeted activities for Special Incentives for activities on BOI General list Economic Development Zones (13 targeted industries)

3-year additional exemption of corporate Exemption of corporate income tax up to 8 income tax (CIT), not exceeding 8 years in total years

Projects with activities in Group A1 or A2 which Additional 50% corporate income tax are already granted 8-year CIT shall receive exemption for 5 years. additional 50% reduction CIT for 5 years.

--10–year double deductions from the costs of transportation, electricity, and water supply --25% deduction of the cost of installation or construction of facilities (apart from normal depreciation deduction) Same incentives --Exemption of import duties on machinery --Exemption of import duty on raw materials imported, used in production for export. --Non-tax incentives i.e. permission to own land and permission to bring in experts to work.

Special Economic Development Zones in accordance with the Announcement of the Policy Committee of Special Economic Development Zones consist of:

1. Tak Special Economic Development Zone consists of 14 sub-districts with border areas in 3 districts in Tak • 8 sub-districts in Mae Sot District: Mae Sot, Mae Tow, Ta Sai Luad, Phra That Pha Dang, Mae Gasa, Mae Pa, Mae Ku and Mahawan. • 3 sub-districts in Pob Phra District: Phob Phra, Chong Kab and Valet • 3 sub-districts in Mae Ramad District: Mae Ja Rao, Mae Ramad, Ka Ne Jue

2. Mukdahan Special Economic Development Zone consists of 11 sub-districts with border areas in 3 districts in Mukdahan • 5 sub-districts in Muang District: Sri Bun Ruang, Mukdahan, Bang Sai Yai, Kam Ar Huan and Na Si Nuan • 4 sub-districts in Wanyai District: Bang Sai Noi, Cha Note, Wanyai and Bongkham • 2 sub-districts in Don Tan District: Pho Sai and Don Tarn

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3. Sa Kaew Special Economic Development Zone consists of 4 sub-districts with border areas in 2 districts in Sa Kaew • 3 sub-districts in Aranyaprathet District: Ban Dan, Pa Rai and Tha Kam • 1 sub-district in Wattananakorn District: Pak Kha

4. Trat Special Economic Development Zone consists of 3 sub-districts in Klongyai District in Trat: Khlong Yai, Had Lek, and Mai Rood

5. Songklah Special Economic Development Zone consists of 4 sub-districts in Sadao District in Songklah: Sadao, Samnak Kham, Samnak Taew, Padang Bazar

6. Chiang Rai Special Economic Development Zone consists of 21 sub-districts in 3 districts • 7 sub-districts in Chiang Khong district: Krueng, Boon Ruang, Rim Khong, Vieng, Sri Don Chai, Sa Tan, HuayKho • 6 sub-districts in Chiang Saen district: Baan Saew, Pa Sak, Mae Ngern, Yo Nok, Vieng, Sri Don Moon • 8 sub-districts in Mae Sai district: Koh Chang, Baan Dai, Pong Ngam, Pong Pha, Mae Sai, Vieng Pang Kam, Sri Muang Chum, Huay Krai

7. Nongkhai Special Economic Development Zone consists of 13 sub-districts in 2 districts • 12 sub-districts in Muang district: Kai Bok Wan, Nai Muang, Baan Duer, Phra Tat Bang Puan, Pho Chai, Pon Sawang, Mee Chai, Vieng Kook, See Kai, Nong Kom Kor, Hat Kam, Hin Ngom • 1 sub-district in Sa Krai district : Sa Krai

8. Nakhon Panom Special Economic Development Zone consists of 13 sub-districts in 2 districts • 10 sub-districts in Muang district: Gu Ru Ku, Tha Kho, Na Sai, Na Raj Kwai, Nai Muang, Baan Pueng, Pho Tak, Nhong Yat, Nhong Saeng, Art Samart • 3 sub-districts in Tha U Ten district: Non Tarn, Ram Raj, Vern Phra Baht

9. Kanjanaburi Special Economic Development Zone consists of 2 sub-districts in Muang district: Kang Sian, Baan Kao

10. Narathiwas Special Economic Development Zone consists of 5 sub-districts in 5 districts • 1 Sub-district in Muang district: Khok Kian • 1 sub-district in Tak Bai district: Jae Hae • 1 sub-district in La Han district: Yi Ngor • 1 sub-district in Wang district: Loh Jood • 1 sub-district in Su Ngai Ko Lok district: Su Ngai Ko Lok

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Cases for general activities eligible for BOI promotion located in Special Economic Development Zone which will receive additional corporate income tax, as follows:

Incentives for projects in Special Economic A1 A2 A3 A4 B1 B2 Development Zone

8 yrs. Activity-based CIT exemption 8 yrs. 5 yrs. 3 yrs. O O (no cap)

Additional CIT Exemption O O 3 yrs. 3 yrs. 3 yrs. 3 yrs.

Total CIT Exemption 8 yrs. 8 yrs. 8 yrs. 6 yrs. 3 yrs. 3yrs.

Additional 50% CIT reduction for a period of P P O O O O 5 years.

Cases for target activities in 13 groups of industries for Special Economic Development Zones* which will receive additional corporate income tax in accordance with the Policy Committee of Special Economic Development Zones as follows:

Incentives for projects in Special Economic A1 A2 A3 A4 B1 B2 Development Zone

8 yrs. Activity-based CIT exemption 8 yrs. 8 yrs. 8 yrs. 8 yrs. 8 yrs. (no cap)

Additional 50% CIT reduction for a period of P P P P P P 5 years.

* Application must be submitted by December 31, 2018

Targeted Activities for Special Economic Development Zones The Policy Committee of Special Economic Development Zones has currently stipulated targeted industries for Special Economic Development Zones, for the first 5 Special Economic Development Zones. Each zone will have different targeted activities depending on local potential, limitation and needs, which are categorized in 13 groups, as follows:

Industries Tak Sa Kaew Trat Mukdahan Songklah

1. Agricultural, fishery and related P P P P P industries

2. Ceramics P

3. Textile, garment, and leather P P P industries

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Industries Tak Sa Kaew Trat Mukdahan Songklah

4. Furniture manufacturing P P P

5. Gem and jewelries P P

6. Medical equipment P P manufacturing

7. Automotive, machinery, and P P parts

8. Electrical appliances and P P P electronics

9. Plastic production P P

10. Medicine production P P

11. Logistics P P P P P

12. Industrial estates/zones P P P P P

13. Tourism related industries. P P P P P

(More details on these 13 groups of targeted industries will be in the List of Targeted Industries to Promote in the Special Economic Development Zones, as appended)

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List of Targeted Industries to Promote in the Special Economic Development Zones

To promote investment in Special Economic Development Zones, especially border areas both in and around industrial estates, to create economic linkages with neighboring countries, and to prepare for the formation of the ASEAN Economic Community, the Board of Investment hereby issues BOI Announcement No. 4/2557 and the list of targeted industries being promoted in the Special Economic Development Zones, in accordance with the Announcements of the Board of Investment Nos. 1/2558, 2/2558, 3/2558, 4/2558, 5/2558.

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Section 1: Agriculture and Agricultural Products

List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

Agro-industry, 1.4 Crop drying and silo facilities fisheries and related businesses

1.5.1 Livestock and aquatic animal Projects must use modern technology, propagation e.g. closed house system, evaporative cooling system, automatic watering and feeding system, vector control measure and system, and sensor system for tracking and counting animals.

1.5.2 Livestock husbandry or Projects must use modern technology, aquaculture (except for e.g. closed house system, evaporative shrimp) cooling system, automatic watering and feeding system, vector control measure and system, sensor system for tracking and counting animals, and effective environmental protection and impact reduction system.

1.6 Slaughtering Projects must use modern technology e.g. stunning method, shackle, cold storage, chilling system, meat quality and contaminant inspection.

List of Targeted Industries to Promote in the Special Economic Zones Industries to Promote List of Targeted 1.8 Grading, packaging and Projects using modern technology, storage of plants, vegetables, e.g. color sorter, vapor heat treatment fruits or flowers to kill fruit fly eggs, or seed coating

1.9 Manufacture of modified starch or starch made from plants that have special properties

1.10 Manufacture of oil or fat from 1. Manufacture of crude or semi- plants or animals (except for refined oil from plants must start soybean oil) from agricultural produce. 2. Manufacture of refined oil from plants must start from agricultural produce or crude oil.

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List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

1.11 Manufacture of natural extracts or products from natural extracts (except for medicine, soap, shampoo, toothpaste and cosmetics)

1.14.1 Manufacture of primary processed rubber

1.15 Manufacture of products from agricultural by-products or agricultural waste (except for those with uncomplicated production processes, e.g. drying, dehydration)

1.17 Manufacture or preservation 1. Projects with only mixing or of food, beverages, food dilution process shall not be additives or food ingredients promoted. using modern technology 2. Projects with fermentation (except for alcoholic process must use starter beverages) cultures that have supporting study or research.

1.19 Cold storage, or cold storage and cold storage transportation

1.20 Trading centers for 1. Total area must not be less than agricultural goods 50 rai. 2. The area for operations and services related to agricultural goods must not be less than 60% of the total land area. in the Special Economic Zones Industries to Promote List of Targeted Space must be allocated for agricultural exhibition or trade, auction centers, cold storage and silos. 3. Inspection, grading and pesticide residue inspection services for agricultural products must be provided.

1.22 Manufacture of animal food production and animal food ingredients*

* Not subject to received 50% reduction of corporate income tax for 5 years

99 A Guide to the Board of Investment 2017 Section 2: Ceramics

List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

Ceramic products 2.4.3 Manufacture of Ceramic Project must have firing process. manufacturing Products (except Earthenware and Ceramic Tiles)

2.17 Manufacture of construction materials and pre-stressed concrete for public utilities*

* Not subject to received 50% reduction of corporate income tax for 5 years Section 3: Light Industry

List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

Textile, clothing, 3.1.1 Manufacture of natural or Projects must use domestic scraps or and leather synthetic fibers waste only. manufacturing

3.1.2 Manufacture of yarn or fabric

3.1.4 Manufacture of garments, clothing accessories, and List of Targeted Industries to Promote in the Special Economic Zones Industries to Promote List of Targeted household textiles

3.2 Manufacture of non-woven fabric or hygienic products made of non-woven fabric

3.3 Manufacture of bags or shoes or products made of leather or artificial leather

3.4 Manufacture of sports equipment or parts

Manufacture of 3.6 Manufacture of furniture or furniture or parts parts

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List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

Gems and jewelry 3.8 Manufacture of gems and manufacturing jewelry or parts including raw materials and prototype

Medical device 3.11 Manufacture of medical manufacturing devices or parts Section 4: Metal Products, Machinery and Transport Equipment

List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

Automotive, 4.4 Manufacture of multi-purpose machinery and engines and equipment parts manufacturing

4.5.2 Machinery, equipment and Projects must have part forming parts and/or repair of mould process and/or with engineering and die design.

4.5.3 Assembling of machinery and Projects must have assembling machinery equipment process as approved by the Board.

4.8.17 Manufacture of other vehicle List of Targeted Industries to Promote in the Special Economic Zones Industries to Promote List of Targeted parts

4.12 Manufacture of motorcycles 1. Project must have structural (except less than 248 cc welding process and spray engine displacement) painting process. 2. Investment plan for manufacturing and utilization of parts must be submitted and approved by the Board of Investment.

4.14 Fabrication industry or platform repair for petroleum industry

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Section 5: Electronics and Electrical Appliances Industry

List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

Electronics and 5.1 Manufacture of electrical electrical products appliances manufacturing 5.2.2 Manufacture of LED lamps

5.2.3 Manufacture of compressors and/or motors for electrical appliances

5.2.4 Manufacture of wire harnesses

5.2.5 Manufacture of parts and/or equipment for other electrical products

5.3.5 Manufacture of audio visual products

5.3.6 Manufacture of office electronics

5.3.7 Manufacture of other electronic products

5.4.6.2 Manufacture of hard disk The cost of refurbishment of existing drives and/or parts (excluding machines shall be regarded as an top covers, base plates or investment and will be taken into List of Targeted Industries to Promote in the Special Economic Zones Industries to Promote List of Targeted peripherals) account in the calculation of corporate income tax exemption cap. The original cost of existing machines shall not be regarded as an investment.

5.4.6.3 Manufacture of top covers, base plates or peripherals for hard disk drives

5.4.12 Manufacture of flexible The manufacturing processes must printed circuits and/or be approved by the Board. multi-layer printed circuit boards and/or parts

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List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

5.4.13 Manufacture of other memory storage equipment

5.4.14 Manufacture of printed circuit board assembly (PCBA)

5.4.17 Manufacture of parts for audio visual products

5.4.18 Manufacture of parts for office electronics

5.4.19 Manufacture of parts for other electronic products

Section 6: Chemicals, Paper and Plastics

List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

Plastics 6.6 Manufacture of plastic Must have plastic forming process. manufacturing products for industrial goods

6.7.1 Multilayer plastic packaging Must integrate more than 2 layers of plastics. List of Targeted Industries to Promote in the Special Economic Zones Industries to Promote List of Targeted

6.7.2 Aseptic plastic packaging Must be certified with ISO 14611 level 7 (Clean Room) or Federal Standard 209 E Class 10000 or above or an equivalent international standard within 2 years from the full operation start-up date.

6.7.3 Antistatic plastics packaging Must be certified with ISO 14611 level 7 (Clean Room) or Federal Standard 209 E Class 10000 or above or an equivalent international standard within 2 years from the full operation start-up date.

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List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

6.8 Manufacture of plastic products from recycled plastic.

Pharmaceuticals 6.10 Manufacture of medicine 1. For conventional medicine manufacturing projects, such promoted projects must achieve GMP standard prescribed by PIC/S within two years from the full operation start-up date. 2. For traditional medicine projects, such promoted projects must achieve GMP standard within two years from the full operation start-up date. 3. For the improvement of existing projects, existing machinery can be used in the promoted project, but its value shall not be included in the investment amount eligible for corporate income tax exemption.

Section 7: Service and Public Utilities

List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions

List of Targeted Industries to Promote in the Special Economic Zones Industries to Promote List of Targeted Economic Promotion Development Zones

Logistics 7.1.3 Container yards or inland businesses container depots (ICD)

7.4.1 Distribution Center: DC 1. The paid-up registered capital must not be less than 10 million baht. 2. Must provide a goods storage facility that is controlled by a modern computerized system.

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List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

7.4.2 International distribution 1. The paid-up registered capital Center (IDC) must not be less than 10 million baht. 2. Must provide a goods storage facility that is controlled by a modern computerized system. 3. International distribution center projects will have additional conditions, as follows: 3.1 Must have a minimum investment (excluding cost of land and working capital) of at least 100 million baht 3.2 The center must distribute goods to at least 1 country.

Industrial zones or 7.9.1.1 Industrial zones or industrial 1. Total land area of the project industrial estates estates must not be less than 500 rai. 2. Factory-designated area must not be less than 60 percent and not more than 75 percent of the total area, except projects with a total area of over 1,000 rai, whose factory-designated area must be approved by the Board of Investment. 3. Other conditions as specified by the Board are as follows: 3.1 The main road - If the total area is over 1,000 rai, the road must

have four lanes of not less in the Special Economic Zones Industries to Promote List of Targeted than 30 meters wide, including road surface of not less than 14 meters wide, traffic island and pavement of not less than 2 meters wide each side and road shoulder or surface wide enough for an emergency stop. - If the total area is over 500 and up to 1,000 rai, the road must have two lanes

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List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

with road not less than 20 meters wide, including road surface of not less than 7 meters wide and pavement of not less than 2 meters wide each side and a road shoulder or surface wide enough for an emergency stop. 3.2 The minor road must have a surface of not less than 8.5 meters wide and a shoulder of not less than 2 meters wide each side. 3.3 Wastewater treatment must be suitable for wastewater characteristics and according to legal effluent standards. Projects must have a post-treatment effluent pool. 3.4 Wastewater discharge system must be completely separate from rainwater discharge system. 3.5 Projects must have an approved system of collection and elimination of garbage, as approved by the Board. 3.6 Factories located in

List of Targeted Industries to Promote in the Special Economic Zones Industries to Promote List of Targeted industrial zones must be according to target industries and forbidden industries specified in the environmental impact assessment report approved by the Expert Review Committee of the Office of Natural Resources and Environmental Policy and Planning (ONEP).

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List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

3.7 The zone must provide factories located in the zone with sufficient public utilities, electricity, water, telephone service and post office. 3.8 The zone must develop about 25 percent of its total land area, or as approved by the Board, for public utility services within two years from the date of investment promotion certificate issuance.

7.9.1.2 Gem and jewelry industrial 1. The total area must not be less zones than 100 rai. 2. Area for operations related to gems or jewelry must not be less than 40 percent of the total area. 3. Projects must have a sales area for gems and jewelry. 4. Projects must provide appropriate security systems. 5. Projects must have meeting rooms, exhibition halls and business centers.

7.9.1.3 Logistics Park 1. The total area must not be less than 200 rai and the project must invest in establishing a

warehouse for lease or sale with in the Special Economic Zones Industries to Promote List of Targeted a total area of not less than 50,000 square meters. 2. Must be located either within 50 kilometers of a port, an airport, a customs checkpoint and an inland container depot (ICD) or in a Free Zone. 3. Projects must designate some or the entirety of its area as a Free Zone.

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List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

4. Projects must have a station to load and unload containers, or a truck terminal and a container depot that can handle at least 50 containers. 5. Projects must install main telecommunication infrastructure that provides hi-speed communications that link the logistics park to domestic and international communication hubs. 6. Thai nationals must hold not less than 51 percent of the total registered capital. 7. Projects must be approved by relevant government agencies.

Businesses that 7.22.1 Ferry services or tour boat Must be approved by relevant Support Tourism services or tour boat renting government agencies.

7.22.2 Tour boat port services Must have facilitating equipment, such as boat lifting equipment, inland boat deck, or boat garage for maintenance purpose.

7.22.3 Amusement parks 1. Must have a minimum investment (excluding cost of land and working capital) of not less than 500 million baht. 2. The project details must be

List of Targeted Industries to Promote in the Special Economic Zones Industries to Promote List of Targeted approved by the Board.

7.22.4 Cultural centers or arts and Must have a minimum investment crafts centers (excluding cost of land and working capital) of not less than 30 million baht.

7.22.5 Open zoos 1. Must have a minimum investment (excluding cost of land and working capital) of not less than 500 million baht, with a total area of not less than 500 rai. 2. Project details must be approved by the Board.

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List of Targeted Industries to Promote in Special Activities Eligible for Investment Conditions Economic Promotion Development Zones

3. Fifteen percent of the total area must be allocated as green area and another fifteen percent as car park.

7.22.6 Aquariums 1. Projects must have a minimum investment (excluding cost of land and working capital) of not less than 100 million baht. 2. An environmental impact assessment report must be submitted within 12 months after the issuance of its investment promotion certificate.

7.23.3 International exhibition 1. Indoor exhibition area must not centers be less than 25,000 square meters. 2. Every hall must have a business meeting room.

7.23.4 Health rehabilitation centers 1. Must use medical technology for medical treatment and health rehabilitation. 2. Must have continuous rehabilitation programs, including overnight treatment.

7.24 Factory Development for Industrial Plant and Warehouse* List of Targeted Industries to Promote in the Special Economic Zones Industries to Promote List of Targeted * Not subject to received 50% reduction of corporate income tax for 5 years

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CHAPTER 2 PROCEDURES OF APPLYING FOR BOI PROMOTION

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PROCEDURES FOR UTILIZATION OF PROMOTIONAL PRIVILEGES OF BOI PROMOTED PROJECTS

In order to make the work of the Office of the Board of investment (BOI) faster and more efficient, so as to better facilitate promoted investors, the BOI has laid out procedures for applying and implementing promotion privileges, according to the BOI announcement No.1/2553 regarding the “Time Frame for Investment Promotion Procedures.” PROCEDURES TO APPLY FOR BOI PROMOTION

Investors Actions Contacts

Study BOI Information and Information and Publications - Investment Services Center obtain BOI application form - One Start One Stop Investment Center (OSOS) - Regional Investment and Economic Centers - Overseas Offices - www.boi.go.th

Fill in BOI online application form (e-Investment) Application Submission www.boi.go.th

Contact officials Presentation/Interview Session within 10 working days Investment Promotion after application submission Bureau 1-4 to make appointment Project Evaluation

Approval/Non-approval Investment value*>2,000 million baht Investment value*≤ 200 million baht Investment Value*>200-2,000 million baht Considered by the sub-committee Considered by OBOI Considered by the sub-committee and then the Board within 40 working days after within 60 working days after within 90 working days after submitting complete documents submitting complete documents submitting complete documents

Remark: *Excluding cost of land and working capital

Notification Investment Promotion Submit Promotion Acceptance Form, (within 7 working days after Bureau 1-4 either online via e-Investment verifying the result) or paper form (F GA CT 07), within 1 month after receiving notification Acceptance of Promoted Status Note : Applicants who apply before December 31, 2016 have to fill in F GA CT 07 form - General Administration Bureau - www.boi.go.th Promotion of Certificate Issuance Submit Company Establishment Form, (within 10 working days) either online via e-Investment or paper form (F GA CT 08), within 6 months after promotion acceptance

Note : Applicants who apply before December 31, 2016 have to fill in F GA CT 08 form with approval document

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PROCESSES FOR PROJECT APPLICANTION AND UTILIZATION

Promoted companies Actions Contacts

Skilled workers and expert Section 24: A permission for entering foreign nationals to the Kingdom for the purpose of studying investment opportunities or any beneficial activities or during the consideration for promoting process - Submit an application for entering expert foreign nations, with paper form (F FR TR 09-07)

Submit for a permission of Services Center for Visas and entering expert foreign nationals Work Permits (considered within for the purpose of working Section 25: A permission for entering foreign nationals 3-10 working days) to the Kingdom after receiving promoting permission - Submit an agreement form for entering foreign skilled workers to the Kingdom via e-Expert system in order to get username and password - Submit an approval form for the position of foreign skilled workers via e-Expert system - Submit an approval form for entering foreign workers’ family to the Kingdom via e-Expert system - Submit other approval forms via e-Expert system

Lands Submit an approval form of Submit an approval form of using lands under using lands under section 27 section 27 after receiving promoting permission Investment Promotion Bureau (after receiving promoting permission) (FLD LO 02) with other necessary paper forms 1-4 (F LD LO 01)

Machines Investment Promotion Bureau 1-4 A permission for machinery’s Submit a Machinery’s Master lists and Board of Investment Center Master lists approval via eMT (considered within 60 working days)

Submit an approval form for importing machines Investor Club Association (within 30 months after receiving Submit the F IN MI form via eMT promoting permission) (proceeded within 3 hours)

Raw and materials

A permission for necessary Investment Promotion Bureau 1-4 raw and material lists Submit a raw and material utilization form and Board of Investment Center (only section 36) (F IN RM 13) (considered within 15 working days)

A permission for importing Submit a form of importing raws Investor Club Association necessary raw and materials and materials under RMTS 2011 (proceeded within 3 hours)

Investment Promotion Bureau 1-4 A permission for production Submit production method form and Board of Investment Center methods (F IN RM 13) (considered within 30 working days)

A permission for cancel Submit an approval form of cancelling necessary raw Investor Club Association necessary raw and material lists and material lists via system (proceeded within 3 hours)

Promoted companies Actions Contacts Project performance information and project applying method Submit project performance information in the next 6 months, Submit a project performance 112 1 year and 2 year after information form via online system receiving promoting permission

A permission for full-project applying approval Submit a full-project applying approval form (within 36 months after receiving (F PM OP 01) promoting permission) Investment Promotion Bureau 1-4 and Board of Investment Center

Submit company’s project Submit company’s project performance form performance every year before June 31 each year via online system

Submit company’s action Submit company’s action form under investment promotion criteria

Corporate income tax incentive application (Note : Only online system (e-Tax) available after 31 August, 2018)

– Prepare documents for apply for tax incentive According to announcement approval of the Board of Investment - Fill in information into e-Tax system No. 3/2016, investors can submit - Print out application form and submit to auditor for a tax incentive via paper form or consideration Investment Promotion Bureau 1-4 online application (e-Tax) - Fill in auditor’s comment with paper form into the from September 1, 2016 to system August 30, 2018 - Submit information through BOI system Promoted companies Actions Contacts

Submit an approval form for importing machines Investor Club Association (within 30 months after receiving Submit the F IN MI form via eMT promoting permission) (proceeded within 3 hours)

Raw and materials

A permission for importing Submit a form of importing raws Investor Club Association necessary raw and materials and materials under RMTS 2011 (proceeded within 3 hours) A Guide to the Board of Investment 2017 Investment Promotion Bureau 1-4 A permission for production Submit production method form and Board of Investment Center methods (F IN RM 13) (considered within 30 working days)

A permission for cancel Submit an approval form of cancelling necessary raw Investor Club Association necessary raw and material lists and material lists via system (proceeded within 3 hours)

Promoted companies Actions Contacts Project performance information and project applying method Submit project performance information in the next 6 months, Submit a project performance 1 year and 2 year after information form via online system receiving promoting permission

Submit company’s project Submit company’s project performance form performance every year before June 31 each year via online system

Submit company’s action Submit company’s action form under investment promotion criteria

Corporate income tax incentive application (Note : Only online system (e-Tax) available after 31 August, 2018)

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INVESTMENT PROMOTION PROCEDURES AND TIMEFRAME

Consideration of Investment Promotion Application

1. The Office of the Board of Investment (OBOI) will consider investment applications under the OBOI’s authority, which is projects with investment value not exceeding 200 million baht, within 40 working days. Projects with investment value exceeding 200 million baht up to 750 million baht will be considered by the sub-committee within 60 working days, and projects with investment value exceeding 750 million baht will be considered by the Board of Investment within 90 working days, counting from the date on which the OBOI receives the complete application form together with documents and supporting evidence. Projects applying for investment promotion must be in accordance with specified criteria.

2. Documents and supporting evidence that applicants are required to submit for consideration are as follows: 2.1 Two sets of complete application forms, as the case may be, as follows: 2.1.1 Application form for Investment Promotion for all Eligible Activities (F PA PP 01) 2.1.2 Application form for Investment Promotion of Services Activities (F PA PP 03) 2.1.3 Application form for Investment Promotion of Software and E-Commerce (F PA PP 04) 2.1.4 Application form for Small and Medium Enterprises (SMEs) (F PA PP 29) 2.2 Projects with investment value of more than 750 million Baht (excluding cost of land and working capital) must submit the project’s feasibility study with details as specified in the OBOI Investment Announcement No. 50/2534 dated November 1, 1991 (see more details on pages 87-89) 2.3 Additional information or supporting documents for each activity, which will be informed of by the OBOI.

3. The applicants can submit the investment promotion application at Investment Promotion Bureaus 1-4, Regional Investment and Economic Centers 1-6, or the Overseas Investment and Economic Center.

4. For further details, please directly contact Investment Promotion Bureaus1-4 of the BOI

Notification of Investment Promotion Approval/Rejection

1. The OBOI will notify applicants of investment promotion approval or rejection in writing within 7 working days, counting from the date of certified resolution.

2. For further details, please directly contact Investment Promotion Bureaus1-4 of the BOI

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Promotion Acceptance

1. Applicants must submit the Investment Promotion Certificate Acceptance Form (F GA CT 07) within one month after the date of receiving notification.

2. In case the applicants can not submit the Investment Promotion Certificate Acceptance Form (F GA CT 07-01) within the due date, the request form for Promotion Acceptance Expansion (F GA CT 01) can be submitted 3 times. The OBOI will consider the 1st and 2nd extensions for promotion acceptance within 3 working days and the 3rd extension within 7 working days, counting from the date on which the OBOI receives the extension request from the applicant.

3. Applicants must submit the Investment Promotion Certificate Acceptance Form or the request form for Promotion Acceptance Expansion (F GA CT 01) to the Promotion Certificate Division, General Administration Bureau of the OBOI.

Investment Promotion Certificate Issuance

1. Applicants must submit the Promotion Certificate Application Form (F GA CT 08) and supporting documents for consideration within 6 months counting from the date of promotion acceptance, as follows: 1.1 Promotion Certificate Application Form (F GA CT 08) with complete information 1.2 Memorandum of association 1.3 Memorandum of association for capital increase (in the case of capital increase) 1.4 Certificate of Business Registration 1.5 Certificate of the Office of the Company Limited and Partnership Registration 1.6 List of Shareholders and their nationalities, certified by the Office of the Company Limited and Partnership Registration. 1.7 Document showing the transfer of funds from overseas (in the case of foreign investment) 1.8 Joint venture contract, licensing agreement, technical assistance contract (if any) 1.9 Utility and Manpower Requirements Form (F GA CT 13)

The OBOI will issue the investment promotion certificate within 10 working days, counting from the date on which the OBOI receives the complete promotion acceptance form and all supporting documents.

2. In case applicants cannot submit the Promotion Certificate Application Form and supporting documents for consideration within the due date according to above No.1, applicants can submit the Form of Extension for Documents Submission to Issue the Promotion Certificate (F GA CT 04) which is allowed 3 times. The OBOI will consider the 1st and 2nd extensions for documents submission to issue the promotion certificate within 3 working days and the 3rd extension within 7 working days, counting from the date on which the OBOI receives the extension request from the applicant.

3. Applicants can submit the Promotion Certificate Application Form or the Form of Extension for Documents Submission to Issue the Promotion Certificate or further details directly to the Promotion Certificate Division, General Administration Bureau of the OBOI.

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Amendment of Document Attached to Promotion Certificate

Amendment of document attached to promotion certificate will be completed 1 day after all required documents have been submitted.

Amendment field Required Document

1.1 Incentive 1. Copy of approved letter from Investment (1) section 28, Exemption of import duties Promotion Bureau on machinery 2. Original promotion certificate (2) section 30, Reduction of import duties for raw or essential materials (3) section 31, Exemption of corporate income tax (increase/reduction incentives) (4) section 36 (1)(2), Exemption of import duty on raw or essential materials imported for use in production for export (expansion) (5) cancellation/partial withdrawal of rights and benefits. (6) extension of Machinery Importation Period and Operation Start-up

1.2 Project specific conditions 1. Copy of approved letter from Investment (1) registered capital Promotion Bureau (2) modification of shareholding structure 2. Original promotion certificate (3) product type/business size (4) factory/business location (5) increase/reduction in production Remark In case of increase in foreign capacity shareholding, documents showing the transfer (6) change in tax value of funds from overseas are required.

1.3 Others 1. Covering letter from the company (1) office location 2. Copy of certificate from the Office of the (2) Company’s name Company Limited and Partnership Registration. 3. Original promotion certificate

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CHAPTER 3 FEASIBILITY STUDY FOR PROJECTS APPLYING FOR INVESTMENT PROMOTION

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A FEASIBILITY STUDY FOR A PROJECT APPLYING FOR INVESTMENT PROMOTION

For a Project with Investment Capital of over 750 Million Baht (Excluding Cost of Land and Working Capital)

A feasibility study for the project must consist of the following details:

1. Summary of the Project

Summary of the project in brief: The applicant’s products, investment capital, factory location, the number of workers, raw materials in use, technology, etc.

2. Industry Overview

2.1 The linkage between the products for which investment promotion is requested with other industries. Explain the general situation of these industries both in Thailand and in foreign countries.

2.2 Demand for the project: 2.2.1 Domestic demand: - Import statistics for the preceding five years. - Production quantity of other manufactures for similar products (if any). - The quantity and future trend of the industries using the products for which investment promotion is requested, as their raw materials. - The demand and future trend of the products. 2.2.2 Major export markets and future trend of these markets

2.3 Local production capacity of similar products: - The number of non-promoted manufacturers, their product quality and productivity. - The number of promoted manufactures and utilization of production capacity (at full scale).

3. The Appropriateness of the Project

3.1 Investors: - Explanation of business and industry experiences of Thai and foreign investors and the company’s executives, and the investment ratio of all investors concerned. - Progress in the negotiations between investors: at the initial stage of negotiation or the contract is signed. - In the case of utilizing an existing company by not setting up a new one, explanation of the shareholders, business, profit and loss, and the preceding balance sheets of the existing company.

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3.2 Financial aspects: - Source of funds: The amount of equity and/or debt, local and from foreign countries. - Utilization of investment capital: For land construction, machinery, working capital, etc. - Cash flow, net present value and internal rate of return (IRR) in the case of exempted corporate income tax and non-exempted corporate income tax. - Progress in the financial institute’s consideration of the application for debt: is it still under consideration or is the debt approved?

3.3 Competitiveness: - Suitability of import duties and business taxes on the products and the main raw materials. - Average production cost at 50%, 80% and 100% of production capacity. - CIF process and cost of imported similar products. - The advantages of manufacturing the products in Thailand. - Sensitivity analysis: The effects on the viability of the project of changes in the projection of the raw materials’ selling price and changes in the rate of taxes and duties on the main raw materials.

3.4 Technical aspects: - Available production techniques, the advantages and disadvantages of each technique, techniques used in various countries, the reasons why the project chose the specific technique(s). - Explanations of technical support, aspects which they assist. - Conditions and limitations of technology transfer, the cost of know-how. - The appropriateness of production process. - The appropriateness of production scales in comparison to those used in factories in other countries. - Sources and adequacy of raw materials, including opportunities to produce raw materials in Thailand. - Factory location: reasons for choosing the province as the factory location; the adequacy of water, electricity and other infrastructure. - Utilization of labor at various levels, training courses. - Effects on the environment: - Will the raw materials of the products or production process cause environmental problems? - Measures to eliminate or control pollution, investment capital for machinery and for expenses of implementation of pollution control plans. - Research and Development (R&D): Explanation of R&D plan. - Improvements on production quality and production design. - Improvements on productivity in conserving raw materials and employees. - Improvements on production process. - Improvements in the quality of the raw materials in use.

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4. Effects on the Overall Economy

4.1 How much will the government lose in revenue by promoting the project? - Corporate income tax. - Import duties on machinery. - Import duties on raw materials.

4.2 Benefits to the overall economy - Domestic value-added. - Saving or bringing in net foreign currency. - Increases in domestic employment. - Factory establishment in provincial areas. - Benefits to linked industries.

5. Assistance from the Government

5.1 The necessity to apply for promotional privileges: requested incentives.

5.2 The degree of necessity to adjust import duties on raw materials and finished products.

5.3 Is it necessary to request special protection from competition from foreign countries or is it necessary to limit the number of local manufacturers?

5.4 Government assistance in various aspects, such as electricity, water, infrastructure etc.

120 A Guide to the Board of Investment 2017 CONTACT ADDRESS

OFFICE OF THE BOARD OF INVESTMENT ONE STOP SERVICE CENTER FOR VISAS 555 Vibhavadi-Rangsit Road, Chatuchak, AND WORK PERMITS Bangkok 10900 18th Floor, Chamchuri Square Building, Tel: +66 (0) 2553-8111 319 Phayathai Road, Pathumwan, Bangkok Fax: +66 (0) 2553-8315 10330 Website: www.boi.go.th Tel: +66 (0) 2209-1100 Email: [email protected] Fax: +66 (0) 2209-1194 Email: [email protected] ONE START ONE STOP INVESTMENT CENTER (OSOS) 18th Floor, Chamchuri Square Building, 319 Phayathai Road, Pathumwan, Bangkok 10330 Tel: +66 (0) 2209-1100 Fax: +66 (0) 2209-1199 Website: osos.boi.go.th Email: [email protected]

REGIONAL OFFICES

REGIONAL INVESTMENT AND REGIONAL INVESTMENT AND ECONOMIC CENTER 1 ECONOMIC CENTER 4 CHIANG MAI OFFICE CHONBURI Airport Business Park 108-110, 46 Moo 5 Laem Chabang Industrial Estate, 90 Mahidol Road, Amphur Muang, Sukhumvit Road, Toongsukhla, Sriracha, Chiang Mai 50100 Chonburi 20230 Tel: +66 (0) 5329 4100 Tel: +66 (0) 3840 4900 Fax: +66 (0) 5329 4199 Fax: +66 (0) 3840 4997, +66 (0) 3840 4999 Email: [email protected] Email: [email protected]

REGIONAL INVESTMENT AND REGIONAL INVESTMENT AND ECONOMIC CENTER 2 ECONOMIC CENTER 5 NAKHON RATCHASIMA SONGKHLA 2112/22 Mitraphab Road, Amphur Muang, 7-15 Chaiyong Building Juti Uthit 1 Road, Nakhon Ratchasima 30000 Hadd Yai, Songkhla 90110 Tel: +66 (0) 4438 4200 Tel: +66 (0) 7458 4500 Fax: +66 (0) 4438 4299 Fax: +66 (0) 7458 4599 Email: [email protected] Email: [email protected]

REGIONAL INVESTMENT AND REGIONAL INVESTMENT AND ECONOMIC CENTER 3 ECONOMIC CENTER 6 KHONKAEN SURAT THANI 177/54 Moo 17, Mitraphab Road, 49/21-22 Sriwichai Road, Makhamtia, Amphur Muang, Khonkaen 40000 Amphur Muang, Surat Thani 84000 Tel: +66 (0) 4327 1300-2 Tel: +66 (0) 7740 4600 Fax: +66 (0) 4327 1303 Fax: +66 (0) 7740 4699 Email: [email protected] Email: [email protected]

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REGIONAL INVESTMENT AND ECONOMIC CENTER 7 PHITSANULOK OFFICE 3rd Floor, Thai Sivarat Building, 59/15 Boromtrilokkanat 2 Road, Naimuang, Amphur Muang, Phitsanulok 65000 Tel: +66 (0) 5524-8111 Fax: +66 (0) 5524-8777 Email: [email protected]

OVERSEAS OFFICES

SHANGHAI TOKYO Thailand Board of Investment, Shanghai Office Thailand Board of Investment, Tokyo Office Royal Thai Consulate General, No. 18, Royal Thai Embassy, 8th Floor, Wanshan Road, Changning Distric, Fukuda Building West, 2-11-3, Akasaka, Shanghai 200336, P.R. China Minato-ku, Tokyo 107-0052, Japan Tel: +86-21-5260-9876, +86-21-5260-9877 Tel: +81 (0) 3-3582-1806 Fax: +86-21-5260-9873 Fax: +81 (0) 3-3589-5176 Email: [email protected] Email: [email protected]

BEIJING OSAKA Thailand Board of Investment, Beijing Office Thailand Board of Investment, Osaka Office Royal Thai Embassy, No.21 Guanghua Road, Royal Thai Consulate-General, Chaoyang District, Beijing, 100600, P.R. China Bangkok Bank Building, 7th Floor, 1-9-16 Tel: +86-10-8531-8755 to 8757, Kyutaro-Machi, Chuo-Ku, +86-10-8531-8753 Osaka 541-0056, Japan Fax: +86-10-8531-8758 Tel: +81 (0) 6-6271-1395 Email: [email protected] Fax: +81 (0) 6-6271-1394 Email: [email protected] GUANGZHOU Thailand Board of Investment, Guangzhou Office SEOUL Royal Thai Consulate-General, Thailand Board of Investment, Seoul Office No.36 Youhe Road, Haizhu District, #1804, 18th Floor, Koryo Daeyeongak Center, Guangzhou, 510310, P.R. China 97 Toegye-ro, Jung-gu, Seoul, 100-706, Korea Tel: +86-20-8385-8988 ext. 220-225, Tel: +82-2-319-9998 +86-20-8387-7770 (Direct Line) Fax: +82-2-319-9997 Fax: +86-20-8387-2700 Email: [email protected] Email: [email protected] MUMBAI TAIPEI Thailand Board of Investment, Mumbai Office Thailand Board of Investment, Taipei Office Express Tower, 12th Floor, Taipei World Trade Center, 3rd Floor, Room 3E 39-40 Barrister Rajni Patel Marg, Nariman Point, No.5 Xin-Yi Road, Sec. 5 Taipei 110, Taiwan Mumbai, Maharashtra 400021, India Tel: +886-2-2345-6663 Tel: +91-22-2204-1589-90 Fax: +886-2-2345-9223 Fax: +91-22-2282-1525 Email: [email protected] Email: [email protected]

122 A Guide to the Board of Investment 2017

NEW YORK PARIS Thailand Board of Investment, New York Office Thailand Board of Investment, Paris Office 7 World Trade Center, 34th Floor, Suite F, Ambassade Royale de Thaïlande 250 Greenwich Street, New York, 8, rue Greuze, 75116 Paris, France New York 10007, U.S.A. Tel: +(33-1) 56 90 26 00 Tel: +1 (0) 212 422 9009 Fax: +(33-1) 56 90 26 02 Fax: +1 (0) 212 422 9119 Email: [email protected] Email: [email protected] Website: www.thinkasiainvestthailand.com STOCKHOLM Thailand Board of Investment, Stockholm Office LOS ANGELES Stureplan 4C 4th Floor, 114 35 Stockholm, Thailand Board of Investment, Los Angeles Office Sweden Royal Thai Consulate-General, Tel: +46 (0) 8463 1158 611 North Larchmont Boulevard, 3rd Floor, +46 (0) 8463 1174-75 Los Angeles CA 90004, U.S.A. Fax: +46 (0) 8463 1160 Tel: +1 (0)-323-960-1199 Email: [email protected] Fax: +1 (0)-323-960-1190 Email: [email protected] SYDNEY Thailand Board of Investment, Sydney Office FRANKFURT Suite 101, Level 1, 234 George Street, Sydney, Thailand Board of Investment, Frankfurt Office New South Wales 2000, Australia Investment Section, Royal Thai Consulate-General Tel: (+61-2) 9252-4884 Bethmannstr. 58,5.0G, 60311 Frankfurt am Main, (+61-2) 9252-4882 Federal Republic of Germany Email: [email protected] Tel: +49 (069) 92 91 230 Fax: +49 (069) 92 91 2320 Email: [email protected]

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Thailand Board of Investment www.boi.go.th A Guide to

A Guide to the Board of Investment 2017 the Board of Investment 2017

Thailand Board of Investment 555 Vibhavadi-Rangsit Road, Chatuchak, Bangkok 10900, Thailand Tel: +66 (0) 2553 8111 Fax: +66 (0) 2553 8315 Website: www.boi.go.th E-mail: [email protected]