THAILAND Law and Practice Contributed by: Nathee Silacharoen, Tawatchai Boonmayapan and Norrapat Werajong, Chandler Mori Hamada
Planner The planner is appointed by the Bankruptcy Court based on the proposal from either the debtor or the creditors’ meeting (as the case may be). They are responsible for preparing the Plan and have the authority to manage the business of the debtor once appointed. Plan Administrator The plan administrator is appointed under the Plan to implement the approved Plan, once such Plan has been approved by the Bankruptcy Court. 4.6 The Position of Shareholders and Creditors in Restructuring, Rehabilitation and Reorganisation Position of Shareholders During business rehabilitation proceedings, the authority to manage the debtor’s business, assets and all legal rights of the debtor’s shareholders will be vested in the planner and the plan administrator, as applicable. Shareholders are not entitled to vote on the business rehabilitation plan, as voting rights are reserved for creditors. As a result, shareholders typically have a limited role in the rehabilitation pro - cess, unless they contribute new funds to support the debtor’s business rehabilitation. In such cases, share - holders may have some influence over the direction of the business rehabilitation. Existing shareholders will nevertheless retain their equity based on their ownership interests – however, they will be entitled to receive dividends only after the debtor has fully repaid the debts owed to all the creditors under the Plan. Rights of Set-Off A creditor may exercise the right of set-off at any time before the Plan is approved by the court, provided that the debts arose before the Bankruptcy Court issues the rehabilitation order. Trading of Claims Under the Bankruptcy Act, the Plan must include details regarding the assignment of rights. Therefore, the assignment of rights is permitted and must be in accordance with the Plan.
Once the court orders business rehabilitation and appoints the planner, the authority to manage the business and assets of the debtor will transfer to the planner. Restrictions on the Debtor’s Use of Its Assets The Bankruptcy Act prohibits the debtor’s assets from being disposed of, distributed or transferred, unless: • otherwise specified in the Plan; • the debtor obtains court approval; or • these actions are within the ordinary course of business. Seeking New Money After the petition for business rehabilitation is granted, the company may borrow new money to continue its business operations, which will form part of the reha - bilitation proceedings. Creditors who lend money to the company for such purpose are entitled to receive repayment under the rehabilitation plan without hav - ing to file an application with the official receiver for debt repayment. In business rehabilitation proceedings, a planner is appointed by the Bankruptcy Court to prepare the rehabilitation plan and to assume the powers and duties of the debtor’s executive management. An offi - cial receiver is also appointed to supervise the pro - ceedings. Once the creditors’ meeting adopts a reso - lution approving the proposed Plan, it is the court’s responsibility to confirm the Plan and to issue an order to approve the Plan. At that point, the authority to manage the debtor’s business will transfer from the planner to a plan administrator, who will implement the approved Plan. Official Receiver In business rehabilitation proceedings, the official receiver is appointed to supervise the proceedings and to review the merits of the debt repayment appli - cations filed by creditors. 4.5 The Position of Office Holders in Restructuring, Rehabilitation and Reorganisation
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