Section 1196. A balance-sheet must be made at least once every twelve months, at the end of such twelve months as constitute the financial year of the company.
It must contain a summary of the assets and liabilities of the company and a profit and loss account.
Section 1197. The balance-sheet must be examined by one or more auditors and submitted for adoption to a general meeting within four months after its date.
A copy of it must be sent to every person entered in the register of shareholders at least three days before the general meeting.
Copies must also be kept open at the offices of the company during the same period for inspection by the holders of certificates to bearer.
Section 1198. On submitting the balance-sheet, the directors must lay before the general meeting a report showing how the business of the company was conducted during the year under review.
Section 1199. Any person is entitled to obtain from any company a copy of its latest balance-sheet on payment of a sum not exceeding twenty baht.
It shall be the duty of the directors to send to the Registrar a copy of every balance sheet not later than one month after it has been adopted by the general meeting.
5. DIVIDEND AND RESERVE
Section 1200. The distribution of dividend must be made in proportion to the amount paid upon each share, unless otherwise decided with regards to preference shares.
Section 1201. No dividend may be declared except by a resolution passed in a general meeting.
The directors may from time to time pay to the shareholders such interim dividends as appeared to the directors to be justified by the profits of the company.
No dividend shall be paid otherwise than out of profits. If the company has incurred losses, no dividend may be paid unless such losses have been made good.
Section 1202. The company must appropriate to a reserve fund, at each distribution of dividend, at least one-twentieth of the profits arising from the business of the company, until the reserve fund reaches one-tenth part of the capital of the company or such higher proportion thereof as may be stipulated in the regulations of the company.
If shares have been issued at a value higher than the face value, the excess must be added to the reserve fund until the latter has reached the amount mentioned in the forgoing paragraph.
Section 1203. If dividend has been paid contrary to the provisions of the last two proceeding sections, the creditors of the company are entitled to have the amount so distributed returned to the company, provided that a shareholder cannot be obliged to return dividend which he has received in good faith.
ection 1204 * Notice of any dividend that may have been declared shall be given by letter to each shareholder whose name appears on the register of shareholders. If the company has any share represented by a certificate issued to bearer, the notice shall also be published once at least in a local paper.Section 1204. Notice of any dividend that may have been declared shall be either published twice at least in a local paper or given by letter to each shareholder whose name appears on the register of shareholders.
Section 1205. No dividend can bear interest against the company.
6. BOOKS AND ACCOUNTS
Section 1206. The directors must cause true accounts to be kept:
(1) Of the sums received and expended by the company and of the matters in respect of which each receipt or expenditure takes place.
(2) Of the assets and liabilities of the company.
Section 1207. The directors may cause minutes of all proceedings and resolutions of meetings of shareholders and directors to be duly entered in the books which shall be kept at the registered office of the company. Any such minutes signed by the chairman of the meeting at which such resolution were passed or proceedings had, or by the chairman of the next succeeding meeting, are presumed correct evidence of the matters therein contained, and all resolutions and proceedings of which minutes have been made are presumed to have been duly passed.
Any shareholder may at any time during business hours demand inspection of the above documents.
PART IV
Audit
Section. 1208. The auditors may be shareholders of the company; but no person is eligible as an auditor who is interested otherwise than as a shareholder in any transaction of the company, and no director or other agent or employee of the company is eligible as an auditor during his continuance in office.
Section 1209. The auditors shall be elected every year at an ordinary meeting.
A retiring auditor is eligible for re-election.
Section 1210. The remuneration of the auditors shall be fixed in any general meeting.
Section 1211. If any casual vacancy occurs among the auditors, the directors shall forthwith summon an extraordinary meeting for the purpose of filling the vacancy.
Section 1212. If no election of auditors is made in a manner aforesaid, the Court shall, on the application of not less than five shareholders, appoint an auditor for the current year and fix his remuneration.
Section 1213. Every auditor shall at all reasonable time have access to the books and accounts of the company, and with regard to such books and accounts he may examine the directors or any other agents or employees of the company.
Section 1214. The auditors must make a report to the ordinary meeting on the balance-sheet and accounts.
They must state in such report whether in their opinion the balance-sheet is properly drawn up so as to exhibit and correct view of the state of the affairs of the company.
PART V
Inspection
Section 1215. Upon the application of shareholders holding not less than one-fifth part of the shares of the company, the competent Minister shall appoint one or more competent inspectors to examine into the affairs of any limited company and to report thereon.
The Minister, before appointing any such inspector, may require the applicants to give security for payment of expenses of the inspection.
Section 1216. The directors, employees and agents of the company are bound to produce to the inspectors all books and documents in their custody or power.
Any inspector may examine upon oath the directors, employees and agents of the company in relation to its business
Section 1217. The inspectors must make a report to be written or printed as the competent Minister directs. Copies must be forwarded by the Minister to the registered office of the company and to the shareholders upon whose application the inspection was made.
Section 1218. All expenses of such inspection must be repaid by the applicants, unless the company, in the first general meeting after such inspection is finished, consents that the same shall be paid out of the assets of the company.
Section 1220. The competent Minister may also, of his own motion, appoint inspectors to report to the Government on the affairs of the company. Such appointment lies entirely within the discretion of the Minister.
PART VI
Increase and Reductions of Capital
Section 1220. A limited company can by special resolution increase its capital by issuing new shares.
Section 1221. No new shares of a limited company may be allotted as fully or partly paid-up otherwise than in money, except in execution of a special resolution.
Section 1222. All new shares must be offered to the shareholders in proportion to the shares held by them.
Such offer must be made by notice specifying the number of shares to which the shareholder is entitled, and fixing a date after which the offer, if not accepted, shall be deemed to be declined.
After such date or on the receipt of an intimation from the shareholder that he declined to accept the shares offered, the director may offer such shares for subscription to other shareholders or may subscribe the shares to himself.
Section 1223. A notice to any shareholder to subscribe for New Shares must be dated and Signed to the directors.
Section 1224. A limited company may, by special resolution, reduce its capital either by lowering the amount of each share or by reducing the number of shares.
Section 1225. The capital of the company may not be reduced to less than one-fourth of its total amounts.
ection 1226 * When a company proposes to reduce its capital, it must publish once at least in a local paper and send to all creditors known to the company a notice of the particulars of the proposed reduction, requiring the creditors to present w ithin thirty days from the date of such notice any objection they may have to such reduction. If no objection is raised within the period of thirty days, none is deemed to exist. If an objection is raised, the company cannot proceed with the reduction of its capital unless it has satisfied t he claim or given security for it.Section 1226. When a company proposes to reduce its capital, it must be published seven times at least in a local paper and send to all creditors known to the company a notice of the particulars of the proposed reduction, requiring the creditors to present within three months from the date of such notice any objection they may have to such reduction.
If no objection is raised within the period of three months, none is deemed to exist.
If no objection is raised, the company cannot proceed with the reduction of its capital unless it has satisfied the claim or given security for it.
Section 1227. If a creditor has, in consequence of his ignorance of the proposed reduction of capital, failed to give notice of his objection thereto, and such ignorance was in no way due to his fault, those shareholders of the company to whom has been refunded or remitted a portion of their shares remain, for a period of two years from the date of registration of such reduction, personably liable to such creditor to the extent of the amount refunded or remitted.
Section 1228. The special resolution by which any increase or reduction of capital has been authorized must be registered by the company within fourteen days after its date.
PART VII
Debentures
Section 1229. Debentures may not be issued.
Secion 1230 to 1235 (Repealed)
PART VIII
Dissolution
Section 1236. A limited company is dissolved:
| (1) | In the case, if any, provided by its regulations. |
| (2) | If formed for a period of time, by the expiration of such period. |
| (3) | If formed for a single undertaking, by the termination of such undertaking. |
| (4) | By a special resolution to dissolve. |
| (5) | By the company becoming bankrupt |
Section 1237. A limited company may also be dissolved by the Court on the following grounds:
| (1) | If default is made in filing the statutory report or in holding the statutory meeting. |
| (2) | If the company does not commence business within a year from the date of registration or suspends its business for a whole year. |
| (3) | If the business of the company can only be carried on at a loss and there is no prospect of its fortunes, being retrieved. |
| (4) | If the number of the shareholders is reduced to less than seven. |
However, in the case of default in filing the statutory report or in holding the statutory meeting, the Court may, instead of dissolving the company, direct that the statutory report be filed or the statutory meeting be held as it may think fit.
PART IX
Amalgamation of Limited Companies
Section 1238. A limited company may not amalgamate with another limited company Except by special resolution.
Section 1239. The special resolution by which an amalgamation is decided must be registered by the company within fourteen days from its date.
Section 1240. The company must publish seven times at least in a local paper and send to all creditors known to the company by registered letter a notice of the particulars of the proposed amalgamation requiring the creditors to present within six months after the date of the notice any objections they may have to it.
If no objection is raised during such period, none is deemed to exist.
If an objection is raised, the company cannot proceed with the amalgamation unless it has satisfied the claim or given security for it.
Section 1241. When the amalgamation has been made, it must be registered within fourteen days by each amalgamated company and the limited company formed by the amalgamation must be registered as a new company.
Section 1242. The share capital of the new company must be equivalent to the total share capital of the amalgamated companies.
Section 1243. The new company is entitled to the rights and subject to the liabilities of the amalgamated companies.
PART X
Notices
Section 1244. A notice is deemed to be duly served by the company to a shareholder if it is delivered personally or sent by post to such shareholder at the address appearing in the register of shareholders.
Section 1245. Any notice sent by post in a letter properly addressed is deemed to have been served at the time when such letter would have been delivered in the ordinary course of post.
Removal of Defunct Companies from Register
PART XII
Transformation of a Registered Partnership and a Limited Partnership to a Limited Company
Section 1246/1 A registered partnership or limited partnership consisting of at least three partners may be converted into a limited company by consent of all partners and performance of the following:
- Notification of the consent of partners to convert the partnership into a limited company to the Registrar in writing within fourteen days from the date of consent by all partners; and
- Publication at least once in a local paper and sending to all creditors known to the partnership a notice of the particulars of t he proposed conversion, requiring the creditors to present within thirty days from the date of such notice, any objection they may have to such conversion. If an objection is raised, the partnership cannot proceed with the conversion unless it has satisfied the claim or given security for it.
Section 1246/2 If no objection is raised or an objection is raised but the claim has been satisfied or security has been given, all partners shall hold a meeting to consent to and proceed with the following:
- Prepare the memorandum of association and the articles of association of the company (if any);
- Fix the amount of share capital of the company, which shall be equivalent to the amount of total contributions of all partners, and fix the number of shares of the company to be vested with each partner;
- Fix the amount already paid in money on each share, which shall be at least twenty- five percent of the stated value of each share;
- Fix the number of ordinary shares or preference shares to be issued and allotted to the partners and the nature and extent of the preferential rights accruing to the preference shares;
- Appoint directors and fix their respective powers;
- Appoint auditors; and
- Carry out other activities as necessary for the conversion. In proceeding with the actions under the first paragraph, the provisions relating to a limited company regarding such respective actions shall apply mutatis mutandis.
Section 1246/3 The former managing partners shall deliver the businesses, property, accounts, documents and evidence of the partnership to the board of directors of the company within fourteen days after the consent by partners and the completion of actions under Section 1246/2. If any partner has not paid in at least twenty-five percent of the price of any share or has not transferred ownership of any property or produced any document or evidence of exercise of rights to the board of directors, the board of directors of the company shall issue a letter demanding that the partner pay in the share price, transfer the ownership, or produce the document or evidence of exercise of rights, as the case may be, for the board of directors within thirty days from the date of receipt of the demand letter.
Section 1246/4 The board of directors of the company shall file with the Registrar an application to register the conversion into a limited company within fourteen days from the date of full compliance with Section 1246/3. In applying for registration of the conversion, the board of directors shall also submit to the Registrar, together with the application for registration, the minutes of partners’ meeting on consideration of consenting to and proceeding with the conversion of the partnership into a limited company under Section 1246/2, the memorandum of association, the articles of association, and the list of shareholders.
Section 1246/5 After the conversion of the registered partnership or limited partnership into a limited company has been accepted for registration by the Registrar, the former registered partnership or limited partnership shall lose its status as a registered partnership or limited partnership under the Civil and Commercial Code and the Registrar shall make a note of such loss on the register.
Section 1246/6 After the registration for conversion of the registered partnership or limited partnership into a limited company, the company shall be vested with all the property, obligations, rights and responsibilities of the former registered partnership or limited partnership.
Section 1246/7 If after the registration for conversion into a limited company, the company is unable to perform any obligation as vested from the converted partnership, the creditor of such obligation may enforce the performance of the obligation on the partners of the converted partnership to the extent that each partner is liable for the obligations of the partnership.
CHAPTER V
LIQUIDATION OF REGISTERED PARTNERSHIP, LIMITED PARTNERSHIPS AND LIMITED COMPANIES
Section 1247. The liquidation of a bankrupt registered pertnership, limited partnership or limited company shall be made, as far as practicable, in accordance with the provisions of the Law of Bankruptcy for the time being in force.
The competent Minister shall issue Ministerial Regulations governing the liquidation of partnership and companies and determining the rate of fees for this purpose.
Section 1248. When a general meeting is prescribed in this Chapter, it means:
(1) As to registered partnerships and limited partnerships, a meeting of all the partners, in which a majority of votes decides.
(2) As to limited companies, the general meeting provided by Section 1171.
Section 1249. A partnership or company is deemed to continue after its dissolution as far as it is necessary for the purpose of liquidation.
Section 1250. The duties of the liquidators are to settle the affairs of the partnership or company, to pay its debts and to distributes its assets.
Section 1251. Upon dissolution of a partnership or company for any other cause than bankruptcy, the managing partners or directors become liquidators unless otherwise provided by the contract of partnership or by the regulations of the company.
If there are no persons to be liquidators under the foregoing provision, a liquidator or liquidators shall be appointed by the Court upon the application of the Public Prosecutor or any other interested person.
Section 1252. The managing partners of directors retain as liquidators the same respective powers which they had as managing partners or directors.
Section 1253. when fourteen days after the date of dissolution or in case of liquidators appointed by the Court, after the date of appointment, the liquidators must:
| (1) | Notify the public by two successive advertisement at least in a local paper that the partnership or company is dissolved and that its creditors must apply for payment to the liquidators, and |
| (2) | Send a similar notice by registered letter to each creditors whose name appears in the books or documents of the partnership or company. |
Section 1254. The dissolution of the partnership or company and the names of the liquidators must be registered within fourteen days after the date of dissolution by he liquidators.
Section 1255. The liquidators must, as soon as possible, make a balance-sheet and have it examined and certified by the auditors, and must summon a general meeting.
Section 1256. The business of the general meeting is:
| (1) | To confirm the directors or managing partners as liquidators, or appoint other liquidators in their stead, and |
| (2) | To adopt the balance-sheet. |
The general meeting may direct the liquidators to make an inventory or to do whatever the meeting may deem advisable for the settlement of the affairs of the partnership or company.
Section 1257. Liquidators not appointed by the Court may be removed and superseded by a unanimous vote of the partners or by a general meeting of the shareholders. Liquidators, whether appointed by the Court or not, may be removed and superseded by the Court on the request of one of the partners or of the shareholders representing one-twentieth part of the paid-up capital of the company.
Section 1258. Any change amongst the liquidators must be registered, within fourteen days after the date of change, by the liquidators.
Section 1259. The liquidators have power:
| (1) |
To bring or defend any legal proceeding, civil or criminal, and to make compromise, in the name of the partnership or company.
|
| (2) |
To carry on the business of the partnership or company, as far as may necessary for a beneficial settlement of the affairs.
|
| (3) | To sell the property of the partnership or company. |
| (4) | To do all other acts as may be necessary for a beneficial settlement of the liquidation. |
Section 1260. No limitation of the power of the liquidators is valid as against third persons.
Section 1261. Unless otherwise fixed by the general meeting or by the Court at the time of the appointment of the liquidators, no act of the liquidators is valid unless done by them jointly.
Section 1262. A resolution of a general meeting or a decision of the Court authorizing a liquidator or liquidators to act separately must be registered within fourteen days from its date.
Section 1263. All costs, charges and expenses property incurred in the liquidation must be paid by the liquidators in preference to other debts.
Section 1264. If a creditor does not apply for payment, the liquidators must deposit the amount due to him as described by the provisions of the Code concerning Deposit in lieu of performance.
Section 1265. The liquidators may require the partners or shareholders to pay such part of their contributions or shares as may be still unpaid and such part must be paid at once, even if it was previously agreed by the contracts of partnership or the regulations of the company that it would be called for at a later period.
Section 1266. If the liquidators find that after the whole of the contributions or shares has been paid up, the assets insufficient to meet the liabilities, they must apply at once to the Court to have the partnership or company declared bankrupt.
Section 1267. The liquidators must deposit every three months at the Registration Office a report of their activities, showing the situation of the accounts of the liquidation.Such report shall be upon gratuitously for inspection to the partners, shareholders or creditors.
Section 1268. If the liquidators continues for more that one year, the liquidators must summon a general meeting at the end of each year from the beginning of the liquidation and must lay before this meeting a report of their activities and detailed account of the situation.
Section 1269. Only so much of the property of the partnership or company may be divided amongst the partners or shareholders as is not required for performing all the obligations of the partnership or company.
Section 1270. As soon as the affairs of the partnership or company are fully liquidated, the liquidators shall make up an account of the liquidation showing how the liquidation has been conducted and the property of the partnership or company has been disposed of; and thereupon shall call a general meeting for the purpose of laying before it the account and giving any explanation thereof.
After the account is approved, the proceedings of the meeting must be registered within fourteen days from its date by the liquidators. Such registration is taken as being the end of the liquidation.
Section 1271. After the liquidation, the books, accounts and documents of the liquidated partnership or company shall be deposited within fourteen days provided by the foregoing section at the Registrar’s Office where they shall be kept for ten years after the end of the liquidation.
All such books, accounts and documents shall be gratuitously open for inspection by any interested person.
Section 1272. No action for payment of debts due from the partnership or company or from the partners, shareholders or liquidators as such can be entered later than two years after the end of the liquidation.
Section 1273. The provisions of Sections 1172 to 1193 and 1207 apply to general meetings held during liquidation mutatis mutandis.
CHAPTER VI
Removal of Registered Partnerships, Limited Partnerships and Limited Companies from the Register Sections
Section 1273/1 Where the Registrar has reasonable cause to believe that a registered partnership, a limited partnership or a company is not carrying on business or in operation, he shall send to the partnership or company by post with acknowledgement of receipt a letter inquiring whether the partnership or company is carrying on business or in operation and informing it that if an answer is not received within thirty days from the sending date thereof, a notice will be published in a newspaper with a view to striking the name of the partnership or company off the register. If the Registrar either receives an answer from the partnership or company to the effect that it is not carrying on business or in operation, or does not within thirty days after sending the letter receive any answer, he may publish once at least in one of the local newspapers, and send to the partnership or company by post with acknowledgement of receipt, a notice that at the expiration of ninety days from the sending date of that notice the name of the partnership or company mentioned therein will, unless cause is shown to the contrary, be struck off the register.
Section 1273/2 If, in any case where a partnership or company has been dissolved and is in the process of liquidation, the Registrar has reasonable cause to believe either that no liquidator is acting or that the affairs of the partnership or company are fully wound up, and the liquidation returns have not been made by the liquidator or the registration of completion of liquidation process has not been applied for by the liquidator, the Registrar may send a letter by post w ith acknowledgement of receipt to the partnership or company and to the liquidator at his last known place of business demanding the appointment of an acting liquidator, submission of the returns or registration of the completion of liquidation, as the case may be, and informing them that if the action is not carried out within one hundred and eighty days from the sending date thereof, a notice will be published in a newspaper with a view to striking the name of the partnership or company off the register. If the partnership or company or the liquidator fails to take the action within the period of time prescribed in the foregoing paragraph, the Registrar shall publish once at least in a local newspaper and send by post with acknowledgement of receipt to the partnership or company and the liquidator notice that at the expiration of ninety days from the date of sending of that notice the name of the partnership or company mentioned therein will, unless cause is shown to the contrary, be struck off the register.
Section 1273/3 At the expiration of the time mentioned in the notice under Section 1273/1 or Section 1273/2, the Registrar may, unless cause to the contrary is previously shown by the partnership or company or the liquidator, strike the name of the partnership or company off the register, and on the strike of its name off the register the partnership or company shall lose its status as a juristic person: provided that the liability of every managing partner, partner, director, managing officer and shareholders shall continue and may be enforced as if the partnership or company had not lost its status as a juristic person.
Section 1273/4 If a partnership, a partner, a company or any shareholder or creditor thereof feels unfairly aggrieved by the partnership or company having been struck off the register, the Court on the application of the partnership, partner, company or shareholder or creditor may, if satisfied that the partnership or company was at the time of the striking off carrying on business or in operation, or otherwise that it is just that the partnership or company be restored to the register, order the name of the company to be restored to the register, and thereupon the partnership or company shall be deemed to have continued in existence as if its name had not been struck off; and the Court may by the order give such directions and make such provisions as seem just for placing the partnership or company and all other persons in the same position as nearly as may be as if the name of the partnership or company had not been struck off. Any request for restoration of the name of the partnership or company to the register may not be made after the expiration of ten years from the day the name is struck off by the Registrar.”
TITLE XXIII
ASSOCIATIONS
Section 1274 – 1297 (Repealed) Provisions of Associations are inserted in Book I (Part II) of the Civil and Commercial Code (Sections 78 – 109).