The changing of shareholders in a Thai company is covered in the Thailand Civil and Commercial Code Part II of the Act. Note that it is always best to speak to a lawyer in Thailand when you change directors of a Thai company or change the shareholding of the company as the rules for the change are very strict in Thailand.
Note that shares in a company in Thailand must be valued at not less than 5 Thai Baht per share and these shares are not divisible. When the shares are called to be paid up the directors of the company must notify all shareholders by registered letter and provide them with 21 days’ notice to this effect.
Each shareholder needs to be issued a certificate. This shareholding certificate needs to show the following on the share certificate:
- – The name of the company of which the shares are held;
- – The numbers of shares in the company which it represents;
- – The amount of each share held;
- – In the case the shares are not fully paid up, the amount paid on each share.
- – The name of the shareholder or a statement that the certificate is to the bearer.
If the shareholders do not provide the money then the directors have to provide them with another notice for the money as well as any interest due on it. The time given must be considered to be reasonable. If the shares are forfeited then under Section 1125 the shares need to be sold at a public auction.
Transfer on Death & Bankruptcy
The transfer of shares need to be stopped at least 14 days before a general meeting is called. On the death or bankruptcy of a shareholder the company when presented with evidence and a request will transfer the shareholding to another person who the shares are due to. This becomes very complicated and even though Section 1132 is one single sentence it is a very important and complex process to change the shareholding on death or bankruptcy. You are best advised to speak to a lawyer about this process and what would be required of the company shareholding being transferred under these circumstances as it will involve the court system in Thailand.
Transfer of Shares on non-paid up shares
Section 1133 states that the transferor of any shares not fully paid up continues to be held liable for the full amount unpaid on the shareholding. Note that no transferor can be held liable for the unpaid shareholding once the transfer is complete. If the new shareholder cannot or will not settle the unpaid shares then this would normally end in court. Once this transfer has been noted in the shareholding of the company after a period of 2 years the transferor of the unpaid shares cannot be held accountable. When buying or selling unpaid up shares in a company it is always best to speak to a lawyer about its implications after the transfer of shares both as shareholder and company.
If you need assistance with a change in shareholding/shareholders then call us today in Phuket or Bangkok for further assistance as corporate law in Thailand and changing of directors and shareholding can spell disaster if not done correctly. Note further that a limited company registered in Thailand may not own its own shares or take them in pledge under Section 1143 of the Act. Call us today for cost effective advice and assistance.
The information contained in our website is for general information purposes only and does not constitute legal advice. For further information, please contact us.