Type 2 Factory – Small Furniture Manufacturing Factory

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G.A.M. Legal Alliance > Thailand Factory License > Type 2 Factory – Small Furniture Manufacturing Factory

The example we will use here to show the process of setting up a small furniture factory is easy to understand. Speak to our license lawyer about a license for your factory. This is a Type 2 factory what need notification to the Department of Industrial Works. So Furnitec is a hypothetical Type 2 factory specializing in small furniture manufacturing. Lets look at the setup process for Furnitec. See the example we made of a Type 3 factory license on here.

Type 2 Factory - Small Furniture Manufacturing Factory

Factory Classification in Thailand

There are three types of factories in Thailand. This example is one of a Type 2 factory.

Type 1 factory is a small operations with minimal impact; do not require a factory license. We made two examples on here. You can read how they had been setup. There is the license for a handmade jewelry factory as well as the license for a handmade soap factory. The Type 1 factory does not need an actual license as it has minimal impact on the environment however must follow certain rules.

Type 2 factory is the one we have here. We have another article on a license for a bread factory on this website. This type of factory is a medium-sized operation with a moderate impact. This type of factory requires registration but less stringent approvals.

Type 3 factory is a more complex factory. The Type 3 Factory, we have two examples on here as well. The first is the license for auto parts manufacture factory and another as a license for a food processor factory. These factories need extensive approvals, license as well as permits. Normally they are large-scale operations or those with significant potential impact.

Overview of WoodCrafters Assembly Co., Ltd.

Factory Profile

• Business Name: Woodcrafters Assembly Co., Ltd.

• Factory Type: Type 2 (Medium risk, requiring registration and compliance)

• Location: Nakhon Pathom, within a designated light industrial zone.

• Size: 1,200 square meters (including assembly area, storage, and office space)

• Employees: about 25 workers

• Products: The assembly of dining tables, chairs, bookshelves, as well as cabinets.

Target Market: Mainly the local retailers and regional furniture stores.

Factory Licenses and Permits Required

1. Factory License (Ror. Ngor. 2)

You will need to have a factory license from the Department of Industrial Works (DIW). You can see the factory license process explained on this website as well. This license allows the factory to legally operate and ensure that there is compliance with the operational and safety standards. Likewise see also the factory license in Thailand as well.

Process for Obtaining the Factory License:

Application Submission:

You will first need to submit the Form Ror. Ngor. 2 to the local DIW office. In this application you will need to have all the details of the operation. These include but not limited to the details of the factory layout, machinery list including their horsepower. Likewise raw materials and production capacity. If you are going to operate in an industrial park in Thailand then there are less issues with zoning as an example.

Inspection:

Once submitted there will need to be an inspection to see that you have complied with the application form. The DIW inspectors will visit the factory site to verify compliance with layout and operational standards. They will also check they you comply with the laws such as checking zoning as well as the horsepower on your machinery.

Approval:

Once the inspector approves the application then the license normally be issued within 30-45 days if requirements are met.

Documents Required:

You will need to have your business registration certificate. Likewise a copy of your ownership of the land or your lease agreement for your factory. In an industrial park then the agreement with the industrial park needs to be provided. There is also the factory layout as well as the machinery plan and power use. Lastly there are environmental and safety plans you have.

2. Business Registration

We have an article on business registration in Thailand. In this example the business was registered so it the business is legally established. The company was registered as a limited company. Likewise the company is now financial and tax compliant.

You will now have registered WoodCrafters Assembly Co., Ltd. as a limited company. Likewise the company now also has a corporate tax ID as well as VAT registration. Se the articles on VAT on this website. Speak to us online or in person. If you need an English speaking lawyer in Bangkok then speak to us.

3. Zoning and Building Permits

With zoning you will need to confirm that the factory is in an industrial zone and that this is correct. You will need written confirmation from the municipality about the zoning. This could be in a light industrial zone in the city. Likewise if it is a build out where you had to build the factory then you will also need to show your building permit for the factory.

4. Environmental Permits

Air Pollution Permit: Should you emitting fumes or dust then you will need to contact the Pollution Control Department at the local municipality. Where there is sanding or varnishing then they will need to check that you have complied with the law.

If the factory’s activities (much like this one in the example) do not generate significant air pollutants or fall below the thresholds set by the Pollution Control Department. Then a permit is not needed, however the application needs to be made. You need to comply with the Factory Act B.E. 2535 (1992) – factories comply with environmental standards.

Likewise the Enhancement and Conservation of National Environmental Quality Act B.E. 2535 (1992) – this law empowers the Pollution Control Department (PCD) to monitor and enforce compliance. Lastly the Public Health Act B.E. 2535 (1992) – This law provides for inspections as well as penalties for violations impacting nearby communities. Lastly the Hazardous Substances Act B.E. 2535 (1992) – This law governs factories that handle or release hazardous substances into the air. This can be VOC or other paints or varnish.

Finally the air has to comply with the National Ambient Air Quality Standards (NAAQS) which Thailand uses for the standards that the Thai government has to on limits for pollutants like particulate matter (PM10, PM2.5), sulfur dioxide (SO₂), as well as nitrogen oxides (NOₓ). We wrote another article on air pollution in Thailand.

Wastewater Discharge Permit:

The local pollution control department in your area will check if you are complying with the law. There are the issues with the wastewater discharge permit is required if the factory produces or discharges wastewater into public drainage systems or natural water bodies. Likewise the Water Resources Act B.E. 2561 (2018) is the law that governs the use and discharge of the factory water into any public water resources.

Note that if the factory does not produce any wastewater or the volume is negligible and meets exemptions under local regulations then this will not be needed. Lastly you will note that there is an article on Wastewater Discharge Standards in Thailand as well.

5. Fire Safety Certificate

Your plan will include a safety plan. This is to prevent fires. You will need to chow that you have installed fire extinguishers and emergency exits. The local fire department may be able to assist you with this. You will need a law firm in Bangkok to assist you with this. The process can become very complex.

Applicable Laws

The following laws have been covered in this article

• Factory Act B.E. 2535 (1992):

Governs factory operations, inspections, and environmental compliance.

• Environmental Quality Promotion Act B.E. 2535 (1992):

Regulates air, water, and waste pollution.

• Hazardous Substances Act B.E. 2535 (1992):

Controls storage and handling of hazardous chemicals.

• Labor Protection Act B.E. 2541 (1998):

Protects worker rights and ensures workplace safety.

Public Consultation

While public consultation is not always mandatory for Type 2 factories, it is recommended for good community relations. Steps include:

• Information Sharing:

Inform nearby residents about the project.

• Feedback Mechanism:

Host public hearings or distribute surveys to gather community input.

• Grievance Redressal:

Set up a dedicated channel to address complaints or concerns.

Conclusion

We have used a hypothetical company called WoodCrafters Assembly Co., Ltd. We used this to show what an example of a Type 2 factory in Thailand look like in terms of the red tape. This is to show anyone who wants to start a small manufacturing business in Thailand. What needs to be covered and what the process is. This hypothetical business is used to illustrate a sustainable approach to furniture manufacturing. Lastly see also our front page for more from our Thailand law firm.

The information contained in our website is for general information purposes only and does not constitute legal advices. For further information, please contact us.