THAILAND Law and Practice Contributed by: John Frangos, Nuanchun Somboonvinij, Santhapat Periera and Niti Muangkote, Tilleke & Gibbins
3.2.12 “Parallel Debt” Structures See 3.2.3 Trust/Trustee Concepts . 3.2.13 Effect of Security Assignments on Residence of Secured Parties
ee. If the debtor has a claim not yet due at the time of the notice against the assignor/transferor, the debtor can set off the claim, provided that it will become due not later than the claim assigned/transferred. An assignment or transfer of an obligation perform - able to order can be set up against the debtor or oth - er third persons only if the assignment or transfer is endorsed on the instrument and the instrument itself is delivered to the assignee or transferee. A novation by a change of the creditor is also governed by the provisions of the laws concerning the assignment. A novation by a change of the debtor may be effected by a contract between the creditor and the new debtor. However, the novation cannot be done against the will of the original debtor. There is no specific requirement under Thai law that a security assignment be translated, certified, notarised or legalised to be enforceable against a domestic par - ty. However, in the event of enforcement, certified Thai translations of the whole or any material part of the relevant agreements or documents may have to be submitted and attached to the originals thereof when they are submitted as evidence to a Thai court. 3.2.8 Domestic Law Security Instruments See 3.2.7 Formalities/Mandatory Terms to Create and Perfect Security Assignments . Thailand has not ratified or acceded to the Convention or the Protocol. There is no specific requirement under Thai law for an assignment to be registered with any local authority. 3.2.10 Transfer of Security Interests Over Aircraft/ Engines Subject to complying with the applicable laws, the transfer of security interests over an aircraft or engines is recognised in Thailand. 3.2.11 Effect of Changes in the Identity of Secured Parties Depending on the change and the type of security or security interest, the security interests could be jeop - ardised. 3.2.9 Domestic Registration of Security Assignments Governed by Foreign Laws
Subject to the terms of the lease and other relevant facts or circumstances, it is unlikely that a secured party under a security assignment will be considered to be resident, domiciled or carrying on business in Thailand by reason only of its execution or enforce - ment of a security assignment. 3.2.14 Perfection of Domestic Law Mortgages Thai law does not provide for the mortgaging of aircraft at present and registration or perfection of a mortgage over an aircraft under Thai law may therefore not cur - rently be achievable or practicable. 3.2.15 Differences Between Security Over Aircraft and Spare Engines Subject to complying with the applicable laws, a pledge of spare engines might be practically feasible. 3.2.16 Form and Perfection of Security Over Bank Accounts Subject to complying with the applicable laws, assign - ment of a bank account and sometimes a pledge of a bank account will typically be used. In addition, a security interest over a bank account created under and according to the Business Security Act BE 2558 will also be recognised. 3.3 Liens 3.3.1 Third-Party Liens Thai law does not recognise the common law con - cept of a lien or a security interest created under it. However, under Thai law, the right of retention and preferential rights, general or special, are recognised and provided for. The right of retention permits the lawful possessor of a property belonging to another party who has an obligation in their favour in relation to the property possessed to retain the whole of the property until the obligation is fully performed. Under the CCC, the right of retention only covers the obligation or value of the work done in relation to the asset or property that is in their possession.
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