This article analyzes the incorporation procedures for companies in the United States and Thailand.
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US law and the laws of Thailand are very different bodies of jurisprudence. However, there are some parallels in the field of corporate law. In this post we will briefly examine the rather minor dissimilarities between the two systems.
In the United States of America, one of the most common entities used to conduct business is the limited liability company (also referred to as an LLC). This type of entity was created in order to provide a relatively easy means for individuals and groups to organize a company with limited liability at a relatively low cost and with relatively little in the way of supporting documentation compared to incorporated entities such as a "C Corp" or an "S Corp". That being said, an American LLC still requires upkeep as records must be kept up to date and the activities of the company must comport with the law of the jurisdiction in which it is incorporated. Therefore, many alien nationals decide to retain the advice of an American lawyer when setting up an LLC. Notably, a registered agent in the United States may be required if the principal parties involved in the LLC's activities are not routinely present in the jurisdiction in which incorporation took place.
In Thailand, establishing a company is, in many ways, not as straightforward compared to the USA. The Kingdom of Thailand doesn't actually have legal provisions for any type of juristic person akin to the US LLC. Furthermore, limited liability is only granted under certain conditions and the conditions associated with such an endeavor are usually cumbersome. Another issue in Thailand is the Foreign Business Act. This legislation prohibits foreign companies from conducting certain types of business in Thailand. This can be a tremendous obstacle for those wishing to enter the Thai market. Although, through use of legal mechanisms such as Foreign Business Licenses, Amity Treaty Certificates, and/or Board of Investment Certificates a foreign company in the Kingdom of Thailand may be eligible to enjoy relative legal equality with its Thai counterparts. That said, Thai visas as well as employment authorization may still be necessary for the foreign employees of the company.
When it comes to visas and work authorization both the United States and the Kingdom of Thailand have strict rules and regulations letselschade bedragen regarding foreign labor. In the USA, certain visa categories such as the L-1 or H-1 may confer a restricted right to work in the USA depending upon the provisions of the visa itself. Those entering the USA as an Immigrant may be accorded unconditional permanent residence depending upon the category of the visa. In Thailand, the Immigration issues are seemingly more straightforward although the issue of work authorization can be far more complicated than the American rules regarding foreign work authorization. In any case, it is generally advisable to consult with a licensed lawyer from the jurisdiction where an individual wishes to conduct business. This helps ensure that the proper steps are taken at the outset of the company incorporation process.
A corporation is a legal entity that is separate and distinct from its owners. In the United States, corporations are organized under state law according to articles of incorporation. However, both the Federal and state governments may form corporations for commercial and governmental activities. Federally chartered banks are designated as national associations or national trust and savings associations. According to law, there must be some indication in the name of the corporation that it is incorporated. For example, "The Business Leadership Development Corporation" and "Javazona Cafes, Incorporated" (abbreviated to "Javazona Cafes, Inc.") are two incorporated legal entities.
An enterprise is a group of activities intended to produce income for profit as a business, as a not-for-profit association, or as a government agency. An enterprise can consist of one or more legal entities.
In its simplest form, a company is a group of individuals who are associates or companions, as opposed to a group of individuals assembled with no distinct purpose. A team is a tightly coupled group working coherently with mutual accountability. In effect, a company is set of teams working together with common purpose.
The term "company" is used in the theatrical profession to describe a group of actors with their accompanying equipment. The term is also used to describe a group of individuals operating a business as employees and owners as juristic persons, regardless of legal form. In the United States, the term "company" can be associated with partnerships, limited liability companies, and corporations. A limited liability company that has a single owner is "disregarded" by the Internal Revenue Service if the owner elects that the entity be taxed as a sole proprietorship. However, in some states and countries, the term "company" is synonymous with "corporation" - meaning that it has a legal form separate from its owners. Hence, "American Express Company" and "Ford Motor Company" are corporations. In some countries, the term "associates (and company)" is synonymous with "partnership," and "anonymous society" is synonymous with "corporation."
The earliest form of companies were unincorporated associations, followed later by partnerships. Individual corporations were initially established by governmental charter. However, the concept of a joint stock company was created over time, which had individual owners with unlimited liability. A joint stock company was similar to a partnership, but had certain rights distinct from the individual owners. A modern corporation is in effect a joint stock company with limited liability of the individual owners.
A tradename is often used to establish a brand separate from the legal name of a sole proprietorship, partnership, limited liability company, or corporation. For example, "BLD" is a tradename of The Business Leadership Development Corporation; "Achieve Plan B" and "Vitaprise" are tradenames of Nigel A.L. Brooks. Tradenames are common in franchise and licensee systems, where different legal entities are part of the same system, and thus share a common identity, such as Enterprise Rent-A-Truck, Holiday Inn, McDonald's, and Subway. The tradename is owned by the franchisor or licensor, but can be used by the franchisees and licensees. However, whenever business is done in a name other than a legal name, it is fictitious and must be registered as a certified "doing business name" in whatever jurisdictions are required under state law. For example, if Nigel A.L. Brooks is doing business as "Vitaprise," that name must be registered as fictitious in each jurisdiction where it is used.
A business is formed to earn a profit from revenues from commissions, dividends, fees, interest, rents, royalties, and sales less expenses from costs of revenue and operating items, and capital gains from investments. An entity such as a sole proprietorship, partnership, limited liability company, or corporation may be formed, organized, or incorporated for the purpose of conducting business before revenue is earned. As such the entity is separate from but related to the business enterprise. A venture is a start-up or early stage enterprise (as opposed to a hobby), which may be classified as a "development stage entity" because it has little or no income. Its future may be uncertain until the business concept has been proven.
The business becomes established when there is a commitment from the owners to earning revenue as an ongoing concern, and predictable patterns among the constituencies start to appear. Thus a business enterprise can be established much later than when the holding entity for it was formed. The entity can be changed as conditions dictate, without changing the nature of the business enterprise. For example, the initial business entity may be a limited liability company organized in Arizona, but later changed to a corporation incorporated in Delaware. Assets of the enterprise and associated revenue streams can be sold separately from the entity, or the entire entity itself can be sold. Similarly, assets and revenue streams, and entire entities can be acquired.
Regardless of the marketing efforts of the management of an enterprise and its legal form, its fate is ultimately determined by the frequency, recency, location, and value of the transactions of its customers based upon their needs and wants. Such transactions are in turn are influenced by the behaviors of employees, regulators, competitors, and market trends in general.
Operating enterprises is an enterpriship (entrepreneurship, leadership, and management) competency.