Amendments to Thailand's Corporate Law
The amendments to Thailand’s Civil and Commercial Code (CCC) on private company limited will become effective as of February 7, 2023. The key amendments purporting to enhance and simplify the corporate business operations in Thailand.
Major amendments:
Convening of shareholders’ meeting: The law removes the burdensome publication of notice convening a shareholders’ meeting in a local newspaper, so a shareholders’ meeting can be convened simply by submission of convening notice to every shareholder. Note that (i) publication on a local newspaper or a prescribed electronic media may be required if the company has bearer share certificates, and (ii) the publication on a local newspaper might be further required if the company’s Articles of Association (AOA) require so.
Holding of board of directors’ meetings: Under the existing corporate law, a director must attend a board of directors personally and cannot appoint anyone to attend the meeting on his behalf. However, the new law allows holding a board of directors’ meetings via electronic means, e.g. video conference, and a director is not required to be present at the meeting personally, unless the company’s AOA specified otherwise.
Minimum promotors: The law reduces the minimum of promoters incorporating a limited company from 3 to 2.
Minimum shareholders: To be in line with the new minimum of promoters, the law reduces the minimum of shareholders of a limited company to 2 persons only, constituting a cause for dissolution of the company, from 3 to 2, so a company would remain existing even though it has only 2 shareholders left.
Quorum of shareholders’ meeting: The law statutorily adopts the existing principal that at least 2 shareholders is required to constitute a meeting quorum, so at least 2 shareholders representing 25% shares of the company must be present at a shareholders’ meeting. Note that the company’s AOA may require otherwise to the extent not lower than the requirement.
Payment of dividends: The law requires completion of payment of dividends within 1 month of the resolution.
Mergers and amalgamation: The law adds a new option for mergers and acquisitions, adopting the merger concept in which a company can merge into another company (A+B=A or A+B=B), on top of the existing amalgamation concept in which the two companies merge into a new company (A+B=C).
We assist you in providing advice on the issues under the new corporate law and adjustments to be suitable to your business and professional services in implementing the amendment of AOA, share transfer, merger and amalgamation as listed above or other related legal works.
