New amendments to Thailand’s Bankruptcy Act aim to: (1) streamline the procedures which require court approval in reviewing claims for repayment of debt; (2) allow creditors additional time to file a claim for debt repayment if the cause of late filing was a force majeure event; and (3) increase the current penalties to match present economic and social conditions.
1. Streamlined procedures
Section 105 has been amended to give the receiver, and not the court, the authority to examine claims for repayment of debts.
Section 106 has been amended to give the official receiver, and not the court, the authority to review disputed claims of debt repayment and issue orders to dismiss or approve such claims.
Previously, under Section 107, the court had the authority to examine claims for repayment of debts and review disputed claims. However, Section 107 was repealed by the amendments.
Following the amendments of Sections 105 and 106, several other provisions which required court approval in relation to debt repayment claims have also been amended, and now only require the receiver’s approval.
2. Timeline for debt repayment claim
Section 91 requires a creditor to file a claim with the receiver within two months of the bankruptcy order’s publication date, which can be extended for an additional two months if the creditor resides outside of Thailand.
A new provision, Section 91/1, has been added which allows a creditor who has not filed a claim within the prescribed time to file the claim at a later time if the creditor can prove that the failure to file on time was due to a force majeure event.
The creditor must file a petition for debt repayment with the court, together with proof of the force majeure event. If the court finds in favor of the creditor, it will issue an order permitting the creditor to file the claim with the receiver within the period prescribed in the order.
The creditor will be entitled to be paid out of the assets of the debtor which remain after distribution has been made to those who filed a petition before the creditor. In addition, actions previously taken by the court, the receiver, and the creditors’ meetings will not be affected.
3. Increased penalties
The amendments increased the penalties from THB 100, THB 200, THB 500, and THB 1,000 to THB 20,000, THB 40,000, THB 100,000, and THB 200,000, respectively, in various sections of the Bankruptcy Act.
These amendments came into effect on August 27, 2015, as codified in the Bankruptcy Act (No. 8) B.E. 2558. If you have any questions about the new amendments to the Bankruptcy Act or your other financial requirements under Thai law, please contact Piyanuj (Lui) Ratprasatporn at +66 2653 5533 or [email protected].