Thailand’s Government, aiming to support business and to simplify the process of setting up and conducting business in the country, has approved in June 2020 new amendments to the Civil and Commercial Code (CCC), with the expectation that the proposed amendments will become law towards the end of 2020 or the beginning of 2021.
In order to streamline the company formation process, one proposed amendment is focused on reducing the number of Thai citizens (known as promoters) required to form a company for the existing three to just two, which is a positive move for foreign investors, many of whom find it difficult to find suitable promoters.
Business registration, business mergers and also court order dissolutions will be targeted by the new amendments. Company registration will now be available at any approved Department of Business Development office, regardless of the location, with registration fees also being waived. In case of mergers, the new provisions will recognize both the amalgamation concept (already existing in the legislation) while also adding the mergers concept, giving companies the choice of either one. When it comes to court order dissolutions this also changed to reflect the aforementioned amendments on the number of promoters needed to establish a company in Thailand.
Dividend payments are also to be modified by the new amendments, with the payment of dividends being possible within one month from approval of the company’s shareholders. Also, the CCC will now allow e-meetings of shareholders and directors, which were first introduced during the COVID-19 crisis by Royal Decree in April 2020, with a minimum two shareholders being obliged to attend the e-meeting in order to constitute a quorum.
(Sources: AseanBriefing; ThailandBusinessNews)