You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

March 26, 2018

Laos Establishes Investment Promotion and Management Committee

Subscribe to Updates

Over the past several months, the Lao government has been introducing a number of measures aimed at promoting foreign investment, from implementing Notification No. 2633/Cabinet/MOIC to abolish minimum registered capital requirements for certain foreign investors, to enacting the new Law on Investment Promotion No. 14/NA (LIP) to facilitate investments among both domestic and international private investors, to promoting the Ministry of Planning and Investment’s One-Stop Service Unit and the Ministry of Industry and Commerce’s Lao Services Portal.

Recently, with the circulation of World Bank Group’s Doing Business Report 2018, which showed that Laos had fallen two places in the report’s ease of doing business rankings since 2017, the government seems to be putting renewed effort into addressing business challenges in the country. The government’s latest measure was the issuance of the Decree on the Establishment and Operation of the Investment Promotion and Management Committee No. 05/PMO, dated January 5, 2018 (the Decree), which provides further clarification on the establishment and operations of the Investment Promotion and Management Committee (the Committee), one of the main approval authorities envisioned under the new LIP.

Investment Approval Authority

The Committee is entrusted to act as one of the main approval authorities in Laos, and will also provide One-Stop Services, serving as the primary point of interaction between the Lao government and private investors of all nationalities.

To better understand the Committee’s role, one must consider that the registration of a legal entity and investment approval in Laos consists of two coexisting processes. Applications will either be handled by:

  • the Ministry of Industry and Commerce (MOIC), or its related department at the local level (i.e., municipal or provincial levels), for general business activities; or
  • the Ministry of Planning and Investment (MPI), or its related department at the local level, for general business activities that are considered to be controlled activities, and concession activities.

Controlled activities include those which may have an effect on the stability of the country, or its order and organization, and the social environment and nature. Requests to conduct such activities in Laos are thoroughly appraised by relevant authorities and government agencies. Controlled activities are currently enumerated under a list that may be subject to wide interpretation by authorities. However, a new list, which may provide better clarity, is expected to be issued during the course of the year.

Concession activities are investments for which the government grants a land concession for the development of a specific project. These may include the development of a special economic zone or industrial zone, the exploitation of natural resources such as a mine or power plant, airline companies, or activities that are operated in the telecommunications sector.

The Committee will be the pivotal authority for consideration and approval of investments, and will include representatives from the MOIC, MPI, and other relevant government agencies. Two different levels of the Committee may be involved in the approval process, the Central Committee or Provincial Committees, depending on the nature and amount of the investment. Consideration and approval for controlled activities and concession activities that may have an adverse impact, as well as approval for the development of a special economic zone, will remain under the ambit of the Central Committee only.

The Committee’s role does not end once investment approval has been granted, and subsequent approvals will be required during the course of the investment and throughout the existence of the legal entity conducting the business activity in Laos if modifications to the initial investment/project are contemplated, such as:  (1) transfer of shares; (2) changes to the objectives of the company; or (3) use of the concession/investment rights as a guarantee. The Committee also has the authority to suspend or cancel licenses granted to investors if requirements are not met.

Promotion of Investment Climate in Laos

The Committee also has the role of supporting the central and local governments in the following investment promotion duties, including:

  • assisting in the research and drafting of policies, strategic plans, or regulations to support and manage investment from the private sector;
  • proposing amendments to laws and regulations to the central or local government;
  • monitoring the adoption and implementation of policies, plans, and resolutions by the central and local governments;
  • researching and drafting policies, strategic plans, and regulations to promote further investment from the private sector, before submitting these to the central and/or local government for consideration; and
  • seeking arbitration from the central government on issues or projects on which the Committee cannot reach a consensus.

One-Stop Services

Both the Central and Provincial Committees will share the duty of managing and improving the efficiency of the One-Stop Service in Laos. Although the system aims to facilitate communication within different government agencies to enable them to provide uniform services to investors, it has attracted criticism from both local and foreign investors over the past few years for failing to have a single point of contact when, for instance, the consideration of an application involves different ministries.

The One-Stop Service units at the central and provincial levels can be considered as permanent offices of the Central Committee and Provincial Committees, respectively. At the Central Committee level, the One-Stop Service will be based out of the Department of Investment Promotion, Ministry of Planning and Investment, and will include a representative from the relevant government agency, who will be tasked with considering different investment requests. At the provincial level, the One-Stop Service will be based out of the Division of Promotion Investment, Department of Investment Promotion of each province, and will also include a representative from the relevant government agency.

The Decree stresses that the Committee has the duty of facilitating private sector investment and easing the difficulties investors may face during the different stages of their business operation in Laos. Thus, private investors may notify the Committees about problems that they are facing during their investment. However, mechanisms for the Committee to receive and provide responses to comments from investors, and the exact issues they will be tasked with responding to, remain in the process of being determined.

Additionally, the Central Committee will be able to organize meetings with domestic and international investors to inform them about new regulations or policies that may impact the local investment climate, and to discuss obstacles encountered by investors to seek solutions to accommodate investments in Laos.

Although not expressly mentioned, the Decree may also help to promote and facilitate harmonious interpretation and implementation of laws in Laos, where the application of laws can vary from one province to another. It is hoped that this issue can be addressed through regular communications and exchanges between the Central Committee and Provincial Committees, such as through the organization of at least one meeting per year.  

Committee Structures and Meetings

The Central Committee will be comprised of the following members:

  1. The Deputy Prime Minister, serving as the committee president;
  2. The Minister of Planning and Investment, serving as the committee vice president and permanent committee member;
  3. The Minister of Industry and Commerce, serving as the committee vice president;
  4. The Vice-Minister of Planning and Investment;
  5. The Vice-Minister of Finance;
  6. The Vice-Minister of Natural Resources and Environment;
  7. The Vice-Minister of Energy and Mines;
  8. The Vice-Minister of Agriculture and Forestry;
  9. The Vice-Minister of Labor and Social Welfare;
  10. The Vice-Minister of Public Works and Transport;
  11. The Vice-Minister of Information, Culture and Tourism; and
  12. The Vice-Minister of Public Security.

The Provincial Committees will be comprised of officials from their respective provinces and administration, as follows:

  1. The governor, serving as the president;
  2. The deputy governor, serving as the vice president;
  3. The head of the Department of Investment Promotion, serving as a permanent committee member;
  4. The head of the Department of Industry and Commerce, serving as the committee vice president;
  5. The head of the Department of Finance;
  6. The head of the Department of Natural Resources and Environment;
  7. The head of the Department of Energy and Mines;
  8. The head of the Department of Agriculture and Forestry;
  9. The head of the Department of Labor and Social Welfare;
  10. The head of the Department of Public Works and Transport;
  11. The head of the Department of Information, Culture and Tourism; and
  12. The head of the Department of Public Security.

The Committee must meet at least twice a month, and may be convened more frequently if necessary. The Decree provides that a quorum is met when at least 50 percent of the members of the Committee join the meeting, and when the members who represent the relevant government agency or have expertise in issues that will be considered during the meeting, are present. To avoid absence, the Decree provides members with the possibility of appointing a representative, or a proxy, to attend the meeting of the Committee on their behalf, whereby the representative should be from the same government agency as the member who is not able to attend.

Budget and Responsibility

The budget to run the Central Committee is directly linked to the Ministry of Planning and Investment’s budget, while the budget of each Provincial Committee is linked to each province’s Department of Investment Promotion, which is the counterpart of the Ministry of Planning and Investment at the provincial level.

The Decree empowers the two Committees to undertake and fulfill duties and obligations assigned to them by the government, and they have at their disposal their own seal to act and decide on both routine tasks and matters of greater importance. The Decree also expressly sets out that both levels of the Committee may enact Decisions (i.e., a legal instrument used by the head of an administration, such as a ministry, to frame their own duties and obligations, better organize the services of their administration, or elaborate and implement higher government legislation), relating to the establishment and operations of the One-Stop Service and its staff.  

The Decree and the Committees it establishes send a positive signal for the investment climate in Laos, and are expected to play a key role in harmonizing investment laws and practices across the country, while expediting investment approvals and other essential processes for investors.

Related Professionals

Practices

Corporate/M&A

Location

RELATED INSIGHTS​ 

September 9, 2026
Certain securities, derivatives, and treasury activities in Thailand were opened to foreign investors when Thailand’s Ministry of Commerce published two new ministerial regulations in the Government Gazette on August 28, 2026. The regulations significantly broaden the service activities that foreign-owned businesses may conduct without a license or certificate under the Foreign Business Act B.E. 2542, as amended (FBA). Securities and Derivatives Business Exemptions Prior to the issuance of these ministerial regulations, the exemptions covered (1) securities brokerage and derivatives brokerage with their only underlying assets being agricultural commodities, financial instruments, and securities; and (2) dealers, advisers, and fund managers conducting derivatives business under Thailand’s derivatives laws. The ministerial regulations provide broader exemptions. In addition to derivatives under the laws on derivatives as before, the following two major categories are provided: Derivatives whose underlying assets or variables fall outside the scope of Thailand’s laws on derivatives. This addresses a gap in the previous framework, which did not comprehensively exempt derivatives tied to nonregulated underlying assets or variables, such as certain commodities. Foreign brokers, advisors, and fund managers can now facilitate a broader range of hedging and risk management instruments without triggering FBA licensing requirements. Derivatives traded outside a derivatives exchange, or over the counter (OTC), whose payments are calculated by reference to foreign exchange rates or interest rates. This removes an FBA licensing barrier for foreign providers of widely used OTC hedging products, broadening the solutions available to importers and exporters managing currency exposure and to borrowers seeking greater certainty over financing costs. The ministerial regulations also exempt brokers and agents handling transactions involving either of these two derivatives categories. For securities businesses, the ministerial regulations add exemptions for margin loans used to purchase securities and for securities repurchase transactions. These additions clarify whether such activities qualify as exempt brokerage
Read More
September 4, 2026
Foreign business restrictions on telecommunications, treasury center businesses, and intragroup support services were eased when Thailand published the Ministerial Regulation Prescribing Service Businesses Not Requiring Permission for Foreign Business Operations (No. 5) B.E. 2569 (2026) in the Government Gazette on August 28, 2026. The ministerial regulation expands the categories of service businesses that foreign investors may operate without a foreign business license (FBL) under the Foreign Business Act B.E. 2542 (1999) (FBA). Of particular relevance to the telecommunications, fintech, and technology sectors, the ministerial regulation exempts: Type 1 telecommunications licensees, which do not have their own networks; Treasury center businesses operated in accordance with Thailand’s exchange control regulations; and Certain intragroup administrative, human resources, and information technology management services. Telecommunications Services Foreign-owned businesses providing telecommunications services under a type 1 telecommunications license may now operate without obtaining an FBL. This may streamline market entry for qualifying telecommunications and digital infrastructure businesses. The exemption applies only to the FBA licensing requirement. Operators must continue to comply with applicable requirements under the Telecommunications Business Act and the regulations of the National Broadcasting and Telecommunications Commission, and the change does not affect foreign ownership restrictions applicable to type 2 or type 3 telecommunications businesses. Treasury Center Businesses The ministerial regulation also exempts qualifying treasury center businesses from the FBL requirement. This may facilitate centralized treasury functions in Thailand, including liquidity management, foreign exchange management, and intragroup funding arrangements. Treasury center operations remain subject to applicable requirements of the Bank of Thailand and other competent authorities. Intragroup Administrative, HR, and IT Services Certain administrative, human resources, and information technology management services provided between affiliated entities are also exempt, provided the relevant entities satisfy prescribed ownership or management criteria. The exemption is available where the service provider and recipient are related through specified ownership
Read More
September 1, 2026
Thailand has taken another step toward liberalizing its foreign business framework, exempting additional service activities and derivatives brokerage or agency businesses from the licensing requirements of the Foreign Business Act (FBA). Since the FBA came into effect, Thailand has taken a measured approach to opening its economy to foreign investment. While the FBA regulates foreign participation in businesses that may affect domestic interests, the framework has also evolved to allow foreign participation in certain business activities where sector-specific laws and regulatory frameworks already provide sufficient oversight, making additional FBA restrictions unnecessary. This is particularly true where Thai businesses are sufficiently capable of competing in certain service sectors, or where liberalization is intended to facilitate the provision of services among companies within the same corporate group. Against this backdrop, two new ministerial regulations have been issued pursuant to the FBA. Service Businesses Under the FBA Under the FBA, certain categories of business are restricted for foreign operators. List 3 of the FBA sets out businesses that foreigners may operate only if they obtain a foreign business license (FBL) or a foreign business certificate (FBC), or unless a specific exemption applies. List 3 (21) covers “other service businesses,” which is a catch-all provision that captures a wide range of service businesses not specifically enumerated elsewhere in the FBA. In practice, this means that most service activities carried on by foreigners in Thailand require an FBL or FBC unless otherwise exempted. Notwithstanding the foregoing, the FBA provides a mechanism to address this breadth by empowering the Minister of Commerce to issue ministerial regulations excluding specific types of service businesses from List Three (21). Once a service business is so excluded, foreigners may operate it without obtaining an FBL or FBC. Prior to the new regulations, four ministerial regulations had been issued to
Read More
August 31, 2026
Thailand has introduced a new regulatory framework that may expose foreign nationals who violate the Foreign Business Act (FBA) to deportation. The Regulation of the Office of the Prime Minister on Deportation B.E. 2569 was published in the Government Gazette on August 27, 2026. The regulation establishes an administrative process for referring foreign nationals for deportation where this is deemed necessary in the interests of public order or public morality. It does not create new substantive deportation powers, but it expressly identifies unlawful business conduct under the FBA—including nominee arrangements—as grounds for referral. Grounds for Deportation Referral The regulation sets out five grounds that may give rise to a referral to the relevant authorities: Unlawful entry into, or unlawful stay in, Thailand in violation of immigration laws. Unlawful employment or engagement in work in violation of laws governing the employment of foreign nationals. Carrying on business in violation of the FBA, including through the use of nominee arrangements. Forging official documents or using forged official documents. Committing an offense punishable by imprisonment of five years or more. The framework takes a broad approach, extending not only to the perpetrators of these acts but also to those who facilitate, instigate, or otherwise support such acts. Deportation Risk Following a Criminal Judgment Where a foreign national has committed any of the above offenses and has fully served the sentence imposed pursuant to a final judgment, the interior minister has the power to order deportation. This power also applies where a court has issued a final judgment sentencing a foreign national to imprisonment but has suspended the execution of the sentence, or has imposed a fine. A deportation order may also specify a period during which the foreign national is prohibited from reentering Thailand. FBA Noncompliance: Broader Consequences Noncompliance with the FBA—including
Read More