Here is information directly from the Forgotten Realms Campaign Setting source book:
Thayan Enclaves
Thayan enclaves are indecent mercantile and political entities within an urban area in a non-Thayn country. Here people interact with Thayan in a peaceful manner, buy magical items, and make deals with the Red Wizards who control the enclave.
An enclave is established after a Thayan diplomat negotiates with the local authorities. These negotiations usually entail lists of benefits for the local rulers, such as an increased amount of magic for their guards and protectors, as well as for the authorities themselves. Depending on the nature of the local authorities, the diplomat presents gifts or offers bribes in order to sweeten the deal. For peaceful or good nations, the gifts are benign or useful items such as potions of cure spells, wands of fly, magic shields, and so on. For more aggressive countries, the bribes are often items that can be used for illicit deeds, such as potions of invisibility, or combat items such as a wand of fireball or magic weapons. Once both parties agree that an enclave can be built, they discuss the exact terms.
The Thayans always require the local government to agree to three demands (known as the Three Laws of the Enclave) and refuse to establish an enclave unless the other party agrees to all of them. The Three Laws prevent abuse at the hands of those who oppose the presence of the Red Wizards on moral, cultural, or religious grounds. If such abuse occurs, the Thayans can claim that the local authorities have failed to provide protection for diplomatic envoys acting within the confines of the law, which would make the local government accountable to Thay itself.
The Law of Sovereignty: The enclave is treated as Thayan soil. Thayan law applies within, the Red Wizards are responsible for patrolling the enclave themselves, and the law of the rest of the country does not apply. The enclave's inhabitants are not immune to prosecution; for example, local authorities can demand that a man who murders someone elsewhere in the town then retreats to the enclave be turned over to the local law, whereupon the Thayans must comply. Slavery is permissible within the enclave, although if the local laws forbid slavery, few Thayans force this point by keeping slaves in the enclaves.
The Law of Trade: The Thayans price their goods and services at 10% below the normal cost. Their merchandise is primarily magic items, and some enclaves also sell mundane equipment such as tapestries and weapons. Technically the sale of slaves is permitted, but since local laws apply outside the enclave, this is futile in lands where slaver is outlawed. An enclave normally sells scrolls of 0-level spells for the cost of creating them if the customer buys an equal number of other magic items (including potions and scrolls of 1st level or higher). The Law of Trade also states that the Thayans can accept slaves as payment for items, and these slaves can be legally transported within the borders of the sovereign nation on the way to Thay. Most antislavery countries require that a potential slave in this situation must either be willing (such as a man selling himself into slavery to provide for his family) or a criminal convicted of a serious offense (such as a murder or treason). The local government sometimes even trades criminals in exchange for Thayan goods.
The Law of Crafting: This law dictates what the Thayans will and will not create for sale to the general public. Normally an enclave only produces potions, scrolls (of up to 4th-level spells), wands, +1 armor, +1 weapons, and minor wondrous items. none of these may have abilities easily used for crime (such as potions of invisibility or a wand of charm person) or overtly destructive (such as a wand of fireball). They may also cast spells for hire. In general, the Thayans never create an item worth more than 2,000 gp, because such items dominate limited resources that could be used to procure cheaper and more desirable products. all items produced in an enclave are required to bear the mark of the Red Wizards and the insignia of the city where the enclave is located. They also refuse to create dangerous items (such as described above) because should someone be harmed with an item created in an enclave, the Thayans could be held responsible. This policy also prevents such items from being used against them.
In exchange for these demands, the Thayans agree to donate 1% of the enclave's profits to the local government. The actual amount is rather soft, since an accurate count is not provided for the local government, and some enclaves allocate a portion of these funds to bribe local guardsmen and officials. Most enclave contracts include brief but regular periods of military service by the wizards in the enclave's employ, which allows the local government access to more spellcasters.
Since the inception of the Thayan enclave, their numbers have increased quickly. Within the lands bordering on the Inner Sea, nearly every (90%) metropolis-level location has an enclave of one sort. Most (75%_ large cities have one, many (50%) small cities do, some (30%) large towns do, and a few (10%) small towns have an enclave, while smaller settlements might have a single Thayan representative or none at all. A typical enclave holds a number of Thayans equal to 1% of the settlement's population. Guards and other support staff for the wizards, including servants, assistants, and mundane artisans, make up at least half of the enclave population. The remainder are wizards of various levels (some with levels in the Red Wizard prestige class). The highest-level wizard is the leader of the enclave, and always has at least one level in the Red Wizard prestige class.