The Commerce Ministry is accelerating the draft process of the One Person Company Act and expects the proposed law to help promote small businesses and boost the country's economy.
Banjongjitt Angsusingh, director-general of the Commerce Ministry's Department of Business Development, said the draft received cabinet approval earlier this year and is now being looked at by the Council of State.
"We are revving up the drafting process, aiming to push it through the NLA [National Legislative Assembly] and enact it by the end of this year," Ms Banjongjitt said.
She said the One Person Company Act would allow one person to create his/her own business, compared with the existing law that stipulates that at least three people have to register as a juristic person, or a company.
The proposed law will allow one person who has a small amount of capital to start a business under a legal framework.
That would make it easier for the government to track small businesses and collect annual tax, as well as lend support in the form of soft loans or other financial help to small companies, which are mostly small and medium-sized enterprises (SMEs).
"That would also include providing help to small local enterprises such as One Tambon, One Product, as well as new startups," Ms Banjongjitt said, adding that about 2.7 million small companies could be formally recognised by the new law.
Current high-tech and online platforms allow everybody to start a business, no matter how small, and the law should be updated accordingly, she said.
However, people registering small businesses under the One Person Company Act must be Thais.
Ms Banjongjitt said the proposed law was part of a process to modernise Thai business law to adapt to globalisation.
She said 12 other countries already have similar laws: Britain, the US, China, Singapore, Vietnam, Germany, Canada, the Netherlands, Italy, New Zealand, India and Japan.
Malaysia is also considering adoption of a similar law, she said.
In other news, the Department of Business Development said the number of new business registrations in July fell by 8% year-on-year to 5,979 companies with total registered capital worth 21.3 billion baht, which was down 48%.
Ms Banjongjitt said the drop in new business registrations reflected a slowdown in the country's economy, which could be partly caused by the impact from serious floods that have hit the country's northeastern region which has drained confidence and deterred investors from starting new companies.
Over the first seven months of this year, new business registrations rose 14% to 41,921 companies with total registered capital of 185.5 billion baht, up 31% year-on-year.
