Parliament approved the draft Act Amending the Civil and Commercial Code last month, it will come into effect 90 days after publication in the Royal Gazette. The amended Act makes some major changes in governance of companies in Thailand.
- Incorporation will only require 2 promoters, down from the current three.
- The private company must be registered within 3 years from the registration date of its Memorandum of Association (MOA)
- Share certificates must be signed by one director of the company and affixed with the company seal if the company is registered with a company seal.
- The Board of Directors meeting can be convened as an e-meeting unless the e-meeting is prohibited by the Articles of Association of the company
- Calling a general meeting of shareholders no longer needs to be published in a local newspaper but can be sent to existing shareholders via post. However, if a company issues bearer certificates, a notice calling a general meeting of shareholders must still be published either in a local newspaper or via electronic media.
- Two shareholders representing at least one-fourth of the capital of the company must be present at a general meeting of shareholders to pass any resolution.
- Dividends must be distributed within one month of a shareholders’ meeting or the directors passing a resolution on dividend payment.
- A company may be dissolved by the court if, among other circumstances, the number of shareholders decreases to one, or there are other reasons that the company can no longer exist.
- Mergers of two or more companies are merged as one surviving company can now be made, in addition to the only option currently allowed which is an amalgamation of companies (where two or more companies are amalgamated by dissolution and a new company is registered).
For more information on how these changes can affect your company, contact Sun Legal with the form below.
Alcohol Bill Sent to House
The Cabinet passed to the House a watered-down bill to ease restrictions on alcohol production, dropping the minimum requirement of 100,000 liters of beer a year, opening the possibility for craft beer production in Thailand.
Dropped from an earlier proposal were the requirements of a minimum registered capital of 10 million baht and a brewery that produces and sells its products on-site.
The minimum production capacities for whiskey, brandy and gin at 30,000 liters a day and for rice whisky at 90,000 liters a day remain unchanged.
The changes will cover two types of licenses — one for the fermented beverage production and the other for communities’ locally-distilled spirits, for those wanting to produce beer. Product quality and production facilities must meet the standards set by the Department of Industrial Works and the Pollution Control Department. The bill also opens up home brewing but permission must be sought from the area Excise office and the products cannot be sold or shared with neighbors. The bill still needs to be passed by Parliament before being signed into law.