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[BANKRUPTCY, INSOLVENCY & REHABILITATION PROCEEDINGS IN THAILAND]
KEY FACTS OF BANKRUPTCY, INSOLVENCY & REHABILITATION PROCEEDINGS UNDER THAI LAW
Introduction The law of Thailand regarding insolvency, bankruptcy and rehabilitation proceeding are stipulated and applied through Thai Bankruptcy B.E.2483 Act (A.D. 1940) (“Bankruptcy Act”) and its amendments No.10, B.E.2561 (A.D. 2018). This paper offers an understanding of the insolvent debtors and their qualification to the protection under Bankruptcy Act and its amendments, as grant ed by the law and/or by the court’s decision or order granted thereunder debtors who initially stated on expressed that they are facing with financial dilemma, bringing them to the point of being insolvent, or they are under the process of negotiation with creditor on an agreement for rehabilitation. To emphasize the criteria of insolvency in Thailand, Chapter 1 of the Bankruptcy Act prescribes the circumstances in which a debtor can be found insolvent 10 , e.g., (1) The debtor transfers his property or the right to manage his property to other person for his creditors’ benefit. (2) The debtor fictitiously or fraudulently transfers or delivers his property to another person. (3) The bankrupted debtor transfers his property or creates any right on his property (4) The debtor carries out any of the following acts purposedly delaying payment or preventing a creditor from receiving the debt payment:
a. leaving or remaining outside the Kingdom b. leaving or concealing himself in his residence or absconding by any other means or closing his business site. c. diverting the property out of the territorial jurisdiction d. surrendering himself to be subjected to a judgment compelling payment which he ought not to make By considering the facts presumed to be insolvent under these criteria, it is crucial that such facts exist at the time the lawsuit was filed. The Comparison between the bankruptcy and rehabilitation under the Bankruptcy Act and its amendments: 1. The Person who is eligible to file the case/ petition with the Court Bankruptcy Case ➢ The Creditor (there have 2 types of creditors which are unsecured creditor and secured creditor 11 ). ➢ The Debtor by its Liquidator, if after the completion of liquidation process, the assets of the company are less than the liabilities of the company. Rehabilitation Case
➢ The Creditor. ➢ The Debtor.
10 Section 8 of the Bankruptcy Act B.E.2483.
receive satisfaction of a claim from the proceeds from disposal of assets. Hence, the secured creditor holds priority on debt collection from the property on which it holds a lien, while the unsecured creditor gets no such protection.
11 Section 6 of the Bankruptcy Act B.E.2483 defines secured creditors as creditors who have preferential rights over a debtor’s (e.g., a mortgage, a pledge or a right of retention), to
ILN Restructuring & Insolvency Group – Bankruptcy, Insolvency & Rehabilitation Series
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