The Corona Crisis leads worldwide to critical situations for companies.
In light of this, Digitorney has asked lawyers from various countries specialized in restructuring law for recommendations on what needs to be done and which solutions are at hand to weather the Corona Crisis.
This part of our series focuses on Thailand:
1) When does a company need to file for insolvency in Thailand?
In the wake of the Asian financial crisis of 1997, Thailand reformed its insolvency law. During that time, the economic crisis brought many Thai companies to their knees. A severe crisis is now upcoming 23 years later due to the current Corona pandemic. This affects companies in the tourism and travel sector before others which hits the Thai economy particularly hard, because the tourism industry is one of Thailand’s most important sectors representing up to 18% of GDP and contributing significantly to the growth of the Thai economy in recent years. MORE
2) What liability risks exist for the management in Thailand in a corporate crisis?
In theory, liability of directors and management only needs to be feared in the event of a breach of duty. However, the duties of directors are varied and governed by many different laws, in particular the Thai “Civil and Commercial Code”, consumer protection regulations, tax laws such as the “Revenue Code” and numerous other legal sources. Therefore, in practice the risk of liability cannot be easily assessed by the non-lawyer. MORE
3) Is there any state aid available for companies in Thailand due to the Corona crisis?
So far, the Thai government has approved inter alia the following aid measures for companies in distress due to the Corona crisis. Furthermore, industry-specific aid measures are currently being discussed. MORE
4) What immediate measures should a Thai company take if it is affected by the Corona crisis?
What immediate measures should the management of a company in Thailand take if it is affected by the Corona crisis? On the one hand, Thai companies need to follow the same principles as all companies worldwide: all conceivable measures must be taken to ensure the liquidity in the short and medium term, worst-case scenarios have to be calculated, additional cash flow sources need to be explored, discussions with current and alternative contractors upstream and downstream need to be initiated for example to minimize the risk of supply chain disruptions. MORE
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