The Royal Gazette announced the Amendment of Civil and Commercial Code (No. 23) B.E. 2565 effective from February 7, 2023 as follows:
Under the new Thai Company Shareholding Structure, the minimum number of shareholders needed to establish a Thai Limited Company and Partnership has been reduced from three to just TWO as of February 7th, 2023.
In the event that there is only one shareholder left, the court may order the dissolution of the business.
SHAREHOLDERS' MEETING
At least seven days before the meeting, the company must send the notice convening the shareholders’ meeting by registered mail to each shareholder listed in the company registry. If the company has bearer shares, it must make an announcement at least 7 days before the meeting date in the local newspaper at least once or post in electronic media in accordance with ministerial regulations.
The presence of at least two shareholders (or their proxies) representing at least one-fourth of the company’s capital is necessary for a quorum at the shareholders’ meeting.
The amended law permits holding board meetings via an internet platform such as Zoom, Google Meet, or MS Teams, among others. Therefore, attendance in person by the directors is no longer required. The meeting can be considered to have a full quorum unless there are other corporate restrictions prohibiting directors from conducting online meetings.
When the new law takes effect, and the corporation has regulations stating that notice of holding the general shareholders’ meeting must be published in the local newspaper, these regulations may still be used and in effect. The business must adhere to the procedures outlined in this rule. If the corporation no longer wishes to publish the notice of the general shareholders’ meeting in a local newspaper, the company has to change their regulations.
SHARE CERTIFICATE
Every share certificate must have at least one director’s signature and, if applicable, the company’s stamp.
MEMORANDUM OF ASSOCIATION
If the Memorandum of Association is filed before this Amendment Act goes into effect but the company has not, it must file for registration within 180 days starting on the day this Act takes effect. The Memorandum of Association (MOA) becomes void if the company fails to register within three years of the MOA being filed.
AMALGAMATION AND MERGER
Prior to the Amendment, the Civil and Commercial Code only recognizes the notion of “amalgamation,” in which two or more firms could combine to form a single new legal entity. The amendment allows and adds one new option of MERGER to form a union of two businesses without the creation of a new legal organization.
CHANGING FROM PARTNERSHIP TO COMPANY LIMITED
With the approval of all shareholders, a registered partnership may become a company limited and proceed as follows:
- submit a letter of consent from the shareholders to the registrar within 14 days of the consent being granted by all shareholders;
- at least once publish an advertisement in the media, and have the document of creditors’ objections ready within 30 days.
We are aware of the strain involved in starting a new business, particularly with the apparently never-ending paperwork and multiple journeys to various government offices. Magna Carta Law Firm provides comprehensive services for company formation and business registration so you can get started right away.
If you have any questions regarding the New Thai Company Shareholding Structure and other matters regarding company formation, book an appointment now!
