New Law for Personal Property Security Interests
On August 7, the National Legislative Assembly ( NLA) approved new legislation called the Business Security Act ( BSA), which will come into force on July 1, 2016.
The BSA is intended to provide Thailand with a form of personal property security interest and improve access to credit for the country’s 2.8 million small and medium- sized enterprises ( SMES). Before the BSA, the only assets that could be mortgaged were immovables, such as land, registered machinery, floating houses, motor cars, beasts of burden and vessels of five tons or more. Significantly, lenders could not obtain security interests over inventory, accounts receivables, businesses and intellectual property.
Under the BSA, the types of assets that can be subject to a security interest have been broadened considerably to include businesses, claims, movable property used by security providers in business operations ( such as machinery, inventory or raw materials used in the production of goods), real estate ( if the security provider is in the real estate business), intellectual property and any other property prescribed in ministerial regulations.
For more information contact Price Sanond Prabhas & Wynne at dmancill@ pricesanond. com.