Legal Update Week 7 – 8
Legal Update Week 7 – 8
(February 2022, reading time approx.: 4 minutes)
Thailand Legal News
SEC strengthens rules on digital asset operators’ custody of their client’s assets (28 February 2022)
– The SEC issued a new regulation to tighten digital asset business operators’ oversight to protect investors. The significant regulations on the custody of clients’ digital assets are:
- Withdrawal or transfer of funds in the account opened for the benefit of customers, the digital asset business operator must obtain approval from 2 authorised persons (for withdrawal or transfer of at least THB 2 Mil. but less than THB 50 Mil.), and another independent person to check the transaction (for over THB 50 Mil.);
- Utilisation of a customer’s assets, funds, and digital assets is forbidden for the benefit of another customer/person;
- Utilisation of a customer’s digital assets to seek benefits (i.e., deposit and loan to others) is forbidden, except investing with licensed digital asset fund managers.
15 February 2022
New government’s measure to promote EVs:
- The Cabinet approved incentive measures to encourage the electric vehicles (EVs) purchase and investment in Thailand. One of the requirements to be eligible under this measure is that the applicant must be an industrial operator in countries that have an agreement with the Excise Department. Only BEV (Battery-Powered Electric Vehicle) is eligible. The benefits are as follows:
- A government subsidy ranging from THB 70,000 to THB 150,000 per a car/truck;
- An excise tax of 2% (reduces from 8%) for car, and 0% for truck;
- Import duty reductions for up to 40% for CBU (Completely Built Up);
- Import duty exemption for CKD (Completely Knocked Down);
*CBU refers to imported vehicles and are ready to use, whereas CKD refers vehicles that have been imported as parts and will be assembled in Thailand.
Tax Incentives to attract High-Potential Foreigners:
- The Cabinet approved in principle the Draft Royal Decree issued under the Revenue Code, which is a measure to attract high-potential foreigners who is qualified for Thailand’s LTR (Long-Term Resident) Visa. The tax privileges are classified by the types of qualifications as shown below:
|1. Wealthy global citizen||PIT exemption for assessable income earned in the previous tax year as a result of work or business performed in foreign countries, or due to assets being located in foreign countries, and bringing cash into Thailand.|
|2. Pensioners from abroad|
3. Work-from-Thailand professionals
*work online and have income from abroad, but stay in Thailand over 180 days
4. Highly-Skilled Professionals
*have experienced in the targeted industries
|Entitle to the same PIT exemption as above, and also entitle to an exclusive reduced WHT at 17% for assessable income, related to employment in the targeted industries operators, that were granted CIT exemption. In case the taxpayer does not claim for tax refund or credit, this assessable income will not be included in the computation of PIT when filing a tax return.|
New amendment to the Copyright Law:
– Under the new Copyright Act (No.5) B.E. 2565, some of the significant changes are mainly on ISPs (the internet service providers):
- ISPs are exempt from liability, when acting as an intermediary for transmitting computer data, temporarily storing computer data, computer data depositary, and searching for the computer data source, in certain circumstances as listed in the Act.
- the requirement for court proceedings were removed due to the measures to suspend online copyright infringement allows ISPs (e.g. Facebook and YouTube) to promptly remove infringing works from their systems when the copyright owner notifies them.
This Act will be fully enforced on 23 August 2022.
Renewal of Lease in the Industrial Estates of Map Ta Phut and Laem Chabang:
- After the lease term has expired, the business operators who lease land in the Map Ta Phut and/or Laem Chabang Industrial Estates, can renew the lease for another 30 years (originally the lease can be renewed only for 20 years). Such lease renewal must be done in writing as per the form specified by the Industrial Estate Authority of Thailand and registered with the Land Department.
Guidelines for the Calculation for THOR Interest Rate Reference:
- The Bank of Thailand (BOT) issued its Notification to establish standard guidelines for Thai Overnight Reference Rate (THOR) interest rate reference calculation. THOR is commonly used in credit facilities, loans, bonds, and etc. Under this Notification, the financial institutions are required to calculate the amount of interest rate that must be paid (reference THOR) using the compound average formula, which takes into account the time value of money to accurately reflect the actual financial cost. This formula will not be deemed as a compound interest, which is prohibited under the law.
The Criteria and Conditions for Location and Environment of Powerplant Consideration for Electricity Generation License Issuance:
- Prior to the issuance of the electricity production license, the location of the powerplant will be determined based on types of technology and fuel utilised to generate electricity. For example, the Energy Regulatory Commission will consider the location and environment. There are criteria for the solar powerplant with not more than 1,000 kW capacity, and hydro powerplant with over 15 MW capacity, considering all relevant laws (e.g. town planning and enhancement and conservation of environmental).
Extension of the Country-by-Country Report Filing Deadline:
– The Revenue Department has extended the deadline for filing Country-by-Country Report (CbCR).
- For the ultimate parent company of a Multinational Enterprise (MNE) group that incorporated under Thai law, the deadline for filing CbCR will be extended to within 12 months after the end of each accounting period.
- While, companies conducting business in Thailand that are required to file CbCR will be given a 60-days extension from the date receipt of the notification from tax assessment officer. These extensions apply to CbCR for accounting periods commencing on or after 1 January 2021.
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