You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

August 30, 2016

Business Reorganization in Thailand: Steps and Procedures

Informed Counsel

In order to repay debts, many flailing companies allocate additional resources to uncover new sources of income. In turn, these companies incur more debt, and this can lead to a vicious downward spiral ending in bankruptcy.

Despite this bleak outlook, these companies still have the potential to recover and become profitable. One way is through reorganization, which provides relief to debtors that allows them to survive a crisis while ensuring that their creditors receive fair repayment.

To initiate the reorganization process, debtors, creditors, or government agencies can submit a reorganization petition to the Bankruptcy Court.

Once the Bankruptcy Court accepts a reorganization petition, all of the debtor’s outstanding debts are automatically stayed or “frozen.” The automatic stay ensures that the debtor will be protected by the Bankruptcy Act, which shields the debtor from creditors’ debt collection efforts.

During an automatic stay, a debtor is obligated not to dispose of, distribute, transfer, pay debt, create debt, or act in any way which may encumber its property, except those necessary for conducting its ordinary business or as otherwise provided by court order.

In the trial phase, the Bankruptcy Court will review all documentary evidence and hear all witnesses. If the Court agrees with the petitioner, it will allow the debtor to reorganize. If it disagrees with the petitioner, the Court will dismiss the case. The petitioner can submit an appeal to the Supreme Court and request a review of the Court’s decision.

Once the Court approves the debtor’s petition to reorganize, it will appoint a planner with the duty to prepare and submit a business reorganization plan for the debtor and operate the debtor’s business. This is usually someone nominated by the petitioner. If there are objections from any creditor or debtor as to the identity of the planner, the official receiver—by court order—will hold a creditors’ meeting to elect a suitable planner.

At the creditors’ meeting, the planner will be approved by the creditors that are owed no less than two-thirds of the total debts, failing which the person proposed by the debtor will be chosen as the planner. Once the planner is appointed, the rights and duties of the debtor will immediately transfer to the planner. In addition, all legal rights of the debtor’s shareholders, with the exception of the right to receive dividends, will be vested in the planner.

After the planner is appointed, the official receiver will publish the Bankruptcy Court’s reorganization order in the Government Gazette and in two widely circulated daily newspapers. All creditors must submit a repayment application with a copy to the official receiver within one month from the publication date. Creditors that are owed debts incurred prior to the Court’s issuance of the reorganization order are entitled to submit an application.

Once all applications have been submitted, the debtor, all creditors, and the planner will have the right to review and object to applications which they deem as invalid. The official receiver will evaluate the matter and render a decision as to voting rights in approving the reorganization plan. During this process, the planner is tasked with drafting the reorganization plan, which must include details such as the reasons why the debtor requires reorganization, principles and methods of business reorganization, redemption of collateral if there are secured creditors or liabilities of a guarantor, ways to resolve problems if there is a temporary lack of liquidity during implementation of the plan, and the time period for the plan which must not exceed five years, among other details. In addition, the planner is empowered to refinance, restructure, and hair-cut the debts as he or she deems necessary.

The planner must submit the plan to the official receiver within three months from the publication date of the Court’s order appointing the planner. After receiving the plan, the official receiver will hold a creditors’ meeting to discuss whether the plan should be accepted in its current form or revised. If a decision is rendered to approve the reorganization plan, a special resolution to that effect must be passed, either: (1) by a majority of the creditors owed three-fourths of the total debts of creditors present at the creditors’ meeting; or (2) by at least one group of creditors who are not already presumed to have approved the plan, provided that the total debt owed to the creditor group represents at least 50 percent of the total debt owed to the creditors present at the creditors’ meeting.

Regardless of whether a resolution accepting the plan is passed, the official receiver will report the outcome of the creditors’ meeting to the Court. If a resolution accepting the plan is passed and the Court determines that the resolution is not illegal and agrees with the outcome, it will issue an order approving the plan. Once the Court approves the plan, the rights and duties of the planner will immediately transfer to the plan administrator. Not only will the plan administrator have the right to manage the debtor’s business under the plan, but in some cases, it will have additional rights not previously available to the planner.

Once the reorganization plan has been operational for some time and proves to be successful, the debtor’s executives, plan administrator, or the official receiver are entitled to report the successful outcome to the Bankruptcy Court and request for termination of the business reorganization. If the Court agrees, it may cancel the business reorganization order, at which point the debtor’s directors and authorized director will regain their full rights to manage the business operations and assets of the debtor, unless the plan had altered these rights. Shareholders of the business will also regain their legal rights. This is the point which flailing companies in reorganization hope to attain, and this is the main reason to engage in the reorganization process.

RELATED INSIGHTS​ 

October 31, 2025
On September 29, 2025, Thailand’s Office of the Personal Data Protection Committee (PDPC Office) published its Regulations on the Review and Certification of Binding Corporate Rules B.E. 2568 (2025) (the Regulations). The Regulations provide clarity on the PDPC Office’s approach to reviewing and certifying binding corporate rules (BCRs) under Section 29 of the Personal Data Protection Act B.E. 2562 (2019) (PDPA), and aim to facilitate international data transfers within a group of undertakings or enterprises (a “corporate group”). In conjunction with this development, the PDPC Office also approved BCRs for two companies operating in Thailand on September 30, 2025. This milestone represents the first concrete progress since the PDPC’s Notification on Criteria for the Protection of Personal Data Sent or Transferred to a Foreign Country pursuant to Section 29 of the PDPA B.E. 2566 (2023) came into effect in March 2024. Some key features of the Regulations are set out below. Categorization of BCRs BCRs are classified into two types: (1) BCRs for Controllers (BCR-C) and (2) BCRs for Processors (BCR-P). The category must be clearly specified when submitting the BCRs to the PDPC Office. Documentation Requirement The applicant must prepare and submit the application (a standard template may be provided by the PDPC Office in the future) along with supporting documents for review and certification in the Thai language. If the supporting documents are in a foreign language, a certified Thai translation should be provided. The translation must be notarized by a notary public or qualified person. Supporting documents may include, among others, a binding instrument such as an intra-group agreement, or a list of entities subject to the BCRs. Expedited Process Requirement Organizations with existing BCR approvals under the EU or UK GDPR, or from countries announced by the PDPC under Section 28, may apply through an
October 30, 2025
Recent events at a Thai listed company, where a proposal to remove the director was not successful, amid claims that a competitor was attempting to gain control of the company, illustrate how disputes over corporate control can unfold differently at the board level and shareholder level. At the board level, removing directors of a listed company mid-term to gain corporate control is not an easy task under Thai law, as it requires a higher threshold than appointing a new director, which typically only requires a simple majority vote in a listed company. At the shareholder level, Thailand’s tender offer and competition regimes add complexity where different shareholder groups act in concert to remove opposing board representatives or otherwise influence control. In this article, we will explore why the attempted removal of a director may fail, and how the tender offer regime may apply. Key Issues at a Glance Shareholder groups may seek to convene meetings to propose changes to board composition or company authority. Such proposals can be delayed or complicated by regulatory requirements and the need for additional disclosures. Regulatory authorities and minority shareholders may raise concerns when major shareholders coordinate to influence board control, especially if such actions could trigger tender offer or merger control obligations. Companies often respond by seeking further information on shareholder relationships and potential conflicts before proceeding. Why the Director Removal Failed Under Section 76 of the Public Limited Companies Act B.E. 2535 (as amended), the early removal of a director requires two conditions to be satisfied at the same meeting of shareholders: Headcount test: At least 75% of shareholders attending and entitled to vote must vote in favor. If multiple shareholders appoint the same person as proxy, each proxy is counted as a separate head for the purpose of the headcount test,
October 30, 2025
Thailand has introduced a comprehensive overhaul of its tax litigation procedures that will significantly impact how tax disputes are handled. The Regulations for Tax Cases B.E. 2568 (2025) take effect on November 24, 2025, and repeal the prior B.E. 2544 (2001) regulations in full. These regulations support the implementation of the Act on the Establishment of the Tax Court and Tax Case Procedure (No. 3) B.E. 2568 (2025), which expands the Tax Court’s jurisdiction to certain criminal tax matters. Published in the Government Gazette on October 14, 2025, the regulations have been reorganized into three parts covering civil cases, criminal cases, and forms, and are designed to accelerate proceedings, tighten evidentiary discipline, and modernize court operations. Structural Reform and Scope The prior regime governed only civil tax disputes. Under the new framework, the regulations introduce a dedicated chapter for criminal cases alongside updated civil procedures, as the Tax Court now has express authority to adjudicate specified criminal tax offenses. Select mechanisms applied in civil case proceedings, such as electronic communication, recording testimony, and appointing experts, also apply to criminal proceedings mutatis mutandis where they do not conflict with criminal procedure. Civil Cases: Evidence Submission, Deadlines, and Scheduling Parties must submit, together with the witness list, originals of all documentary evidence, media, or electronic data (such as files, USB drives, or CDs), and all physical evidence in the party’s possession. Failure to submit any original within the deadline (see below) results in a loss of the right to adduce that item at trial, subject only to narrow exceptions where submission is impossible due to force majeure or where receipt of the evidence is indispensable to the interests of justice. The practical impact is that parties are now obligated to assemble and verify all original documents and data at the very
October 24, 2025
The Thai Arbitration Institute (TAI), a division of Thailand’s Office of the Judiciary, has taken a step toward harmonizing the tools available for dispute resolution. On August 8, 2025, the institute formally launched the TAI Mediation Center (TAI-MC). Although the amendments to TAI’s Arbitration Rules that will govern the TAI-MC have not yet been finalized, the framework now under consideration suggests that TAI is positioning itself to become a more attractive venue for commercial dispute resolution. In the regime contemplated under the current version of the amendments, TAI proceedings will adopt an “arbitration-annexed mediation” mechanism—commonly termed the “Med-Arb” model—while preserving the procedural safeguards indispensable to arbitral neutrality. Mediation will be entrusted to a separate, dedicated mediator appointed under the TAI-MC who is precluded from serving on the arbitral tribunal in the same matter. By clearly separating the functions of mediator and arbitrator, the institute eliminates any risk that confidential information disclosed during mediation could influence the adjudicatory outcome if the parties do not settle. Only when all parties subsequently make a request may that same mediator assume arbitral duties in the case. The parties will retain substantial autonomy in selecting the mediator. They may either designate a mediator by mutual consent or invite the TAI-MC to appoint one from its authorized panel. TAI has announced its intention to curate that panel with particular emphasis on commercial expertise and cross-cultural negotiation skills, supplemented by ongoing professional training. Where the parties cannot agree on remuneration, the mediator’s fee will default to a tariff comparable to the TAI-MC’s cost schedule, which under the current version of the amendments will be approximately THB 45,000 for disputes in which the aggregate claims do not exceed THB 10 million, with incremental increases tied to higher claim values. This predictable cost matrix is aimed at enhancing