In Thailand, you can easily bypass the need to actually invest / paid up the registered capital for setting up a new business by acquiring an existing active or non active company. This approach offers a unique avenue for companies to navigate the intricate web of financial regulations while simultaneously expanding their operations and resources. In this article, we will explore the concept of bypassing regulatory capital requirements through acquisitions and examine why it has become an appealing strategy for businesses.
Understanding Regulatory Capital Requirements
Before delving into the strategy of acquiring existing companies, it is crucial to comprehend the significance of regulatory capital requirements. These requirements are mandated by regulatory bodies, such as central banks, DBD, Revenue Department and financial authorities, to ensure the stability and solvency of financial institutions and corporations. They stipulate the minimum amount of capital a company must maintain to cover potential losses and risks, thereby safeguarding stakeholders’ interests.
Bypassing Regulatory Capital Requirements
In Thailand, when you acquire an existing company, the checks on whether the company comply with the initial paid up capital requirement is avoided as the government offices here such as DBD and Revenue Department no longer check on this matter. It is deemed by default that the company you acquired has already passed the checked for their initial paid up capital requirements.
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