Publication Requirement: Conflict Between Articles of Association and Amendments to The Civil and Commercial Code

March 28, 2023
The amendments to the Civil and Commercial Code (“CCC”) will come into effect on 7 February 2023, after being published in the Government Gazette on 8 November 2022. (please click HERE for more information). One of the key changes pertains to the requirement for publishing notice of a shareholder’s meeting. The new amendment eliminates the requirement for a newspaper publication, except in cases where share certificates are issued to bearers that the newspaper publication, either physical or electronic, is still required. The Department of Business Development (“DBD”) has clarified the publication requirement for notice of a shareholder’s meeting under the new amendments on its website. According to the clarification, if the articles of association (“AOA”) of a company that issued only named share certificates specify a requirement for newspaper publication according to the existing CCC provision before the amendments to the CCC, the company must still require a newspaper publication according to its AOA. If the company wishes to eliminate such requirement, it must prior amend the articles relating to such requirement in its AOA to align with the CCC amendments. As the amendment to the AOA must be approved by the shareholder’s meeting, the company may consider amending its AOA immediately after the effective date of the amendments to the CCC, or it may continue the current practice until the next scheduled shareholder’s meeting; for example, the next annual general meeting of shareholders within April 2023 for companies with a financial year ending 31 December 2022. Authors: Peangnate Sawatdipong Bio: Peangnate is a Partner at Chandler MHM Ltd. (CMHM) and has been with the firm since 1985. She...

Thai Civil and Commercial Code Amendment: Introduction of Merger Scheme and Flexibility for Corporate Governance of Limited Companies

November 9, 2022
On September 14, 2022, the Parliament approved the draft of the Act Amending the Thai Civil and Commercial Code (the “Amendment Act”) covering Title XXII on Partnerships and Limited Companies. Under this Amendment Act, a new M&A scheme and amended corporate governance requirements have been introduced for limited companies. The draft was initiated by the Department of Business Development (“DBD”) with the goal of facilitating business operations by revising outdated requirements, removing excessive corporate compliance obligations, and promoting the business consolidation scheme under the Thai Civil and Commercial Code (the “TCCC”). The Amendment Act was recently submitted to the Cabinet for His Majesty the King’s signature on September 19, 2022, and will take effect 90 days following its announcement in the Government Gazette. This article highlights key elements of the Amendment Act, as well as comparisons with the existing provisions under the TCCC and the implications for business operators. Key Elements of the Amendment Act The groundbreaking changes proposed under the Amendment Act can be divided into three major aspects as set out in the following table. Topic Details 1. Company Establishment (i)      Minimum Number of Promotors Section 1097 of the TCCC requires a limited company to have at least three individuals as promotors upon its incorporation. The Amendment Act reduces the minimum number of promotors required to just two individuals. (ii)    The Memorandum of Association While Section 1099 of the TCCC does not provide any deadline for the registration of a limited company’s Memorandum of Association, the Amendment Act requires that the company shall be incorporated within three months from the registration date of its Memorandum of Association with the DBD. In...