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Focused on creating supportive environment for doing business in Thailand, the Head of the National Council for Peace and Order issued Order No. 21/2017 on 4 April 2017 with immediate effect to amend five key legislations, namely the Civil and Commercial Code, the Labour Protection Act, the Public Limited Companies Act, the Social Security Act and the Bankruptcy Act.
Amongst other significant amendments, certain key changes which may warrant particular attention can be summarised as follows:
- Civil and Commercial Code
- corporate registration can now be made nationwide, as opposed to being restricted within the province where the head office is located;
- a share certificate issued by a company no longer requires a company's seal, but is now valid upon bearing a signature of at least one director;
- dividends declared must now be paid within one month from the date of the resolution of the shareholders or directors (as the case may be); and
- any cause making a continuance of the company to be impossible (i.e. a dead lock in business) has been included as an additional ground for shareholders to seek a court's order for its dissolution.
- Public Limited Companies Act
The minimum requirement of shareholders requesting for calling an extraordinary general meeting has been reduced to not less than 10 percent of the total number of issued shares of the company (as opposed to the pre-amended minimum of 25 percent or 25 persons holding an aggregate of not less than 10 percent). - Labour Protection Act
A copy of work rules and regulations will no longer be required to be submitted with the Department of Labour Protection and Welfare, Ministry of Labour, and therefore reduces the administrative burden on employers. - Bankruptcy Act
During an automatic stay or rehabilitation process, a secured creditor may now enforce the secured properties after one year from the date of receipt of the petition by the court, whilst this was not permitted under the pre-amended Act. Nevertheless, such period may be extended twice by the court, provided that each extension shall not exceed six months.
This document is solely intended to provide an update on recent development in Thailand legislation and is not purported to provide a legal opinion, nor a legal advice to any person.