Amend­ments to Bank­ruptcy Act Pro­vide Greater Pro­tec­tion for SMES

Thai-American Business (T-AB) Magazine - - Property Trends -

Re­cent amend­ments to Thailand’s Bank­ruptcy Act which came into force on May 25, will pro­vide SMES with greater pro­tec­tion against bank­ruptcy. Prior to the amend­ments, the Bank­ruptcy Act B. E. 2483 ( 1940), which gov­erns the re­ha­bil­i­ta­tion process for debtors, only pro­tected debtors which were pri­vate lim­ited com­pa­nies, pub­lic lim­ited com­pa­nies, or other ju­ris­tic per­sons as de­fined by Min­is­te­rial Reg­ula- tion. It ex­cluded nat­u­ral per­sons, ju­ris­tic bod­ies, and part­ner­ships. In ad­di­tion, to be el­i­gi­ble for re­ha­bil­i­ta­tion, debtors had to meet a min­i­mum thresh­old of in­sol­vency, with an amount of debt not less than Baht 10 mil­lion. These re­quire­ments ham­pered SMES’ ac­cess to re­ha­bil­i­ta­tion, which is nec­es­sary for busi­ness sur­vival dur­ing hard times.

The amend­ments open the re­ha­bil­i­ta­tion process to nat­u­ral per­sons, ju­ris­tic bod­ies, and part­ner­ships, while also low­er­ing the min­i­mum thresh­old of debt to not less than Baht 2 mil­lion for nat­u­ral per­sons, not less than Baht 3 mil­lion for ju­ris­tic bod­ies and part­ner­ships, and be­tween Baht 3 and 10 mil­lion for pri­vate lim­ited com­pa­nies.

For more in­for­ma­tion con­tact Tilleke & Gib­bins at luxsiri. s@ tilleke. com.

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