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Global rules on foreign direct investment (FDI)
Cross-border acquisitions and investments increasingly trigger foreign direct investment (FDI) screening requirements.
Thailand | Publication | May 2024
For decades, Thailand has upheld its prohibition on casino business within its borders. However, in April 2024, a significant shift occurred in the country's stance when the Cabinet of Thailand acknowledged the report on the study of opening entertainment complexes (Report). The Report emphasized the necessity of specific legislation governing the operation of entertainment complex businesses, including casino businesses, in Thailand. It also included the draft Entertainment Complex Bill (Entertainment Complex Bill).
The Entertainment Complex Bill aims to establish provisions for operating an entertainment complex businesses in Thailand as further described below.
Entertainment Complex: It is defined as a venue that operates multiple types of entertainment businesses, such as restaurants and bars, five-star hotels, and sports entertainment, along with a casino business. The proportions of each type of business within an entertainment complex are not yet established. However, the Deputy Finance Minister publicly stated that the casino area may be limited to only 5 per cent. of the total space.
Licensing Requirements: Business operators are required to meet the following criteria to obtain a license to operate an entertainment complex business: (i) they must be incorporated in Thailand, and (ii) they must have a minimum registered capital of THB 10,000 million (equivalent to approximately USD 276,400,000 as of the date of publication). Additionally, the process to select a licensee shall be conducted through a bidding process.
Minimum investment requirements: The report stated that licenses for operating an entertainment complex business may be categorized into sizes of small, medium, large and extra large. However, initially, only licenses in the size of extra large are expected to be available, with a minimum investment value of THB 100,000 million (equivalent to approximately USD 2,764,000,000 as of the date of publication).
Casino Entry Requirements: The Entertainment Complex Bill prohibits certain vulnerable groups from entering the casino, such as persons under the age of 20 or those prohibited by a court order. Additionally, Thai nationals are required to register and pay a casino entry levy.
Taxation: The Entertainment Complex Bill does not specify a tax rate for entertainment complex business operators. However, according to the Report, it is proposed that a casino tax should be established at a rate of 17% on the revenue gained from players after deducting the winnings paid out to them (gross gaming revenue). In addition, other excise taxes might be implemented for other entertainment businesses, such as a golf course tax, a card games tax, and a nightclub tax.
The promulgation timeline of the Entertainment Complex Bill is uncertain as the bill is still in its initial stage. As a next course of action, the Ministry of Finance will jointly consider the Report with other ministries to study the need for this new legislation, determine the appropriate locations for entertainment complexes, and assess both positive and negative impacts for the country.
We would like to thank our trainee, Patcharapol Sudsakorn at NRF Bangkok office, for his contribution to this post.
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Cross-border acquisitions and investments increasingly trigger foreign direct investment (FDI) screening requirements.
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On February 2, 2024, the Belgian Presidency of the Council of the European Union confirmed that the Committee of Permanent Representatives had signed the Artificial Intelligence (AI) Regulation, referred to as the AI Act. Approval by the EU Parliament followed on 13 March 2024, and the AI Act is likely to appear in the EU’s Official Journal around May 2024. The AI Act aims to establish a stringent legal framework governing the development, marketing, and utilisation of artificial intelligence within the region, thereby marking a significant advancement in the regulation of this burgeoning domain.
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The EU’s Artificial Intelligence Regulation, commonly referred to as the AI Act, is expected to come into force during the summer of 2024 (the AI Act). The AI Act will be the first comprehensive legal framework for the use and development of artificial intelligence (AI), and is intended to ensure that AI systems developed and used in the EU are safe, transparent, traceable, non-discriminatory and environmentally friendly.
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