FACTORY LICENSE
How to get Factory licenses in Thailand
The Factory Act regulates the factory construction, the business operations, a possible factory expansion and all safety and pollution requirements. The Ministry of Industry can thus decide upon the following items:
1) The size of the factory.
2) The quantity of each type of factory, with the power to disallow the establishment of certain factories if there are already too many in Thailand. Some process does not allow in Thailand.
3) The type, quality, source of origin, and ratio of raw materials to be used in the factory. Process flow must be reported.
4) The type or quality of the products to be manufactured in the factory, with the possibility that one is obliged to export their products wholly or partly (or that the manufactured products are limited to certain industries), and.
5) The type of energy to be used in a factory.
A factory is defined as “a building, place or vehicle that uses a machine from five horsepower or more or an equivalent, or which employs seven or more workers for manufacturing, producing, assisting, packing, repairing, maintaining, testing, improving, processing, conveying, storing or destroying anything included in the classes or types of factories presently listed in the Ministerial Regulations, and that are not owned or operated by government agencies for the purpose of national security or safety”.
Not all factories as described here above need a license. Some just need to notify the officials beforehand and can start business as soon as they receive a letter from the Ministry stating that their report has been received well. The intensity of the control is based upon the probability of pollution and the required protection of the environment, which is at its turn based upon the output of the factory:
* Factories that use machinery equivalent to between 5 and 20 horsepower and/or that employ 7-20 people for manufacturing do not require a license. However, the manufacturer must follow the ministerial regulations: but some process must get licenses.
* Factories that use machinery equivalent to more than 20 horsepower but less than 50 and/or that employ more than 20 but less than 50 people for manufacturing: the manufacturer must inform to the officer before starting business and of course must be compliant with ministerial regulations.
* Factories that pollute and that use machinery equivalent to more than 50 horsepower and/or that employ more than 50 people for manufacturing must receive a license from the officer before the start of the operations.
The issuance of the factory license is subject to the Ministry’s discretion. Since, in most cases, the start-up is time sensitive, one may be granted a certificate allowing them to start building parts of the factory.
Every license holder is obliged to additionally inform the Ministry in case of the following changes and/or incidents:
1) Operation has been stopped for more than one year: written notification within seven days of the date the one-year period has lapsed to receive a written approval before restarting business.
2) An accident that causes death, injury, or sickness that incapacitates a worker for more than 72 hours: obligation to notify the Ministry within three days from the date of the accident.
3) An accident that causes the factory to stop operations for more than seven days: obligation to notify the Ministry within 10 days from the date of the accident.
4) Removal of machinery or the factory to another site for temporary operations: obligation to notify the Ministry within 7 days.
5) Decease of the licensee: the heir or administrator must submit an application for the transfer of the license within 90 days.
6) Factory expansion (increase of the number or the power of the machines or if a part of the factory building would be added or alternated so that the foundation of the factory can bear a load of an additional 500 kilograms or more): an additional approval must be requested within 7 days and a fee of 100,000 baht will be due.
How to get Factory licenses in Thailand
The factory may always be inspected to ensure continuous compliance with the Factory Act. This can be done by government officials or by a private body. If the factory would be endangering the public, the Ministry can oblige the license holder to make improvements or
even cease business. A violation of the Factory Act’s provision may also incur penalties such as fines or imprisonment (for the company and / or its directors).
Timeframe
Within 30 days after the request for the license, an official will come to investigate the location and report his findings. The approval or rejection will be announced to the owner of the factory within the following 60 days.
Validity of the license and renewal
The license is not expired. license fee a renewal should be requested every year. The fee therefore is again. It is a personal license in the sense that a new one will have to be requested if the factory is transferred or leased.
Apart from a notification or license, please take note of the fact that the Ministry of Industry has issued regulations for many different items such as:
1) The description, category, or type of machinery and equipment to be used in the operation of the factory business.
2) The location and environment of the factory (e.g., no factories can be built in residential areas or within 50 meters of public places).
3) The interior and description of the factory
4) Requirements for workers
5) The process of manufacture and provision of equipment
6) Electricity system certificate, Machine system safety certificate
7) Water and Air system controller
8)The safety document follows production line system
9) And more……... please call us for more information