In brief
The Thailand Board of Investment (BOI) grants investment promotions for the development of software, digital platforms, or digital content. Previously, when applying for such investment promotions, the key conditions were that the software, digital platforms, or digital content must be newly developed in Thailand or substantial parts of it must be developed or modified in Thailand. Minor developments or modifications did not qualify for investment promotion from the BOI, and the BOI maintained a negative list of activities that did not qualify as development. However, on 15 March 2024, the BOI issued a new notification announcing a new promoted activity: the modification of software, digital platforms, or digital content.
In more detail
According to the BOI’s clarifications on this announcement, the modifications include the following:
- Modification to connect to other software or services (Application Programming Interface or API)
- Modification of user interface (UI), other than adding new languages
- Modification of certain functions or properties of the system to accommodate new products or services, customers, or tools/devices
- Modification of the system to improve efficiency or to support new equipment, such as using a new computer language, new database, or new operating system
- Customized modifications according to customer requirements, other than installation, configuration, and maintenance.
The BOI requires a minimum investment of THB 1.5 million. This is calculated from the annual salary expenses of newly hired Thai IT personnel and/or the annual salary expenses of temporary Thai IT personnel. While the BOI does not provide income tax benefits for this type of business, promoted companies will receive import duty exemption on machinery (if any) and other non-tax benefits, such as having majority foreign shareholding and work permit privileges.
These additional activities provide more opportunities for business operators to apply for investment promotions. Business operators that are engaged in the relevant businesses or have previously applied for investment promotion for the development of software, digital platforms, or digital content, may want to consider the new activity promoted by the BOI to enjoy the relevant privileges.
For more details, please contact our team at Baker McKenzie.
