Factory Licensing in Thailand: Legal Guide for Industrial Operations

Operating a factory in Thailand requires compliance with the Factory Act and oversight from the Department of Industrial Works (DIW), Ministry of Industry. Whether you are building, expanding, or operating a manufacturing facility, knowing which license (or notification) you need is essential. BASE Law Firm is here to help you navigate these regulatory requirements.

Our service include:

Factory category and license assessment
DIW filing and documentation support
Regulatory and environmental compliance guidance
Machinery, layout, and safety review
License renewal and modification assistance
Ongoing inspection and risk management

What Is a “Factory” Under Thai Law?

Under Thailand’s Factory Act, a “factory” is broadly defined as a place (including buildings or vehicles):

That employs machinery with a power of 50 horsepower or more, or
Has 50 or more workers, whether or not machines are used.

Importantly, not all production sites are “factories” in the legal sense (smaller operations or those employing fewer than 50 workers may be exempt).

Also, under the 2019 amendments, construction activities are no longer treated as “factory setup” by default.

Factory Licensing Categories

Thai law divides factories into three main categories:

Factory Category	Regulatory Requirement
Category 1	No license required. For lower-capacity operations.
Category 2	Prior notification to the DIW, after which operations may begin once receipt is confirmed.
Category 3	Full factory license (Ror Ngor 4) is required before starting operations.

For Category 3 factories, in certain cases, the Ministry may grant a preliminary permit, allowing construction or installation of machinery even while the formal license application is in process.

Key Legal Updates & Regulatory Changes

In 2019, important amendments were made to the Factory Act. Among the changes: the definition of “factory” was updated, and license renewals (for many) were simplified.
In 2024, a new regulation removed the requirement for a factory license for rooftop solar installations, making it easier for businesses to deploy solar generation systems.
The DIW now allows qualified private inspectors (and not only government inspectors) to carry out factory inspections under certain conditions.

What Must Be Submitted to Obtain a Factory License

When applying for a Category 3 factory license (or during notification for Category 2), you’ll need to prepare and submit:

A detailed plan of the factory premises (building layout, machinery placement).
Description of the manufacturing process (how goods will be made, stored, and transported).
Information on machinery and equipment: power (horsepower), origin, capacity.
Health, safety, and environmental control plans: especially if there is a risk of pollution.
Data on workforce: number of employees, their roles, and qualifications.
Evidence of waste disposal or emissions control systems, if relevant.
Proof of capital or funding for the factory operation, tied to the permit type required.

Risks, Compliance, and Penalties

Operating a factory classified under Category 3 without a valid license can lead to fines, imprisonment, or both.
The DIW may inspect premises at any time; failure to comply with environmental, safety, or machinery regulations may result in enforcement actions.
Factory license obligations are not just one-time: modifications (e.g., expansion, adding new machinery) require fresh DIW approvals.

Renewal & Ongoing Obligations

Under the traditional regime, factory licenses had a 5-year validity period.
However, after the 2019 amendments, a factory license will not automatically expire as long as the factory continues operations and the renewal requirement may no longer apply in the same way.
Operators must also remain compliant with safety, environmental, and labor regulations on an ongoing basis. Private inspectors (under certain criteria) may conduct routine inspections

Strategic Considerations & Why You Should Seek Legal Counsel

Securing the right factory license (or notification) in Thailand is not just about ticking boxes — it’s a strategic process. Here are some of the critical considerations:

Regulatory risk: Misclassifying your factory or failing to license properly may lead to penalty and disruption.
Environmental compliance: Safety and pollution control are central; you need systems that satisfy DIW standards.
Expansion planning: Thinking ahead (e.g., adding machinery) will help you avoid delays later.
Cost savings: Correctly positioning your license may help you avoid unnecessary fees or inspections.
Corporate strategy: Licensing impacts not just operations, but valuation, financing, and exit options.

How BASE Law Firm Can Help

At BASE Law Firm, we support both local and foreign investors with:

License Assessment: We determine which category your factory falls into under current Thai law.
Application Preparation: We draft and assemble all required documentation for the DIW.
Regulatory Navigation: We manage negotiations and approvals with relevant ministries and inspectors.
On-Going Compliance: We assist with reporting, inspections, and legal updates.
Risk Mitigation: We advise on structuring your factory operations to minimize regulatory and environmental risk.

Conclusion & Next Steps

If you are planning to establish or expand a factory in Thailand, it is essential to align your regulatory strategy with your business goals. At BASE Law Firm, our legal expertise and local experience can help you secure the correct license structure, keep operations compliant, and manage long‑term risk.

Contact us today to discuss your factory project, we’ll help you chart a clear path through Thai regulatory requirements so you can build and operate with confidence.