This information is for reference only and is not legal advice. Consult a licensed lawyer before any transaction.
Public Limited Companies Act
Public Limited Companies Act B.E. 2535 (1992)
The information is reviewed and updated monthly against official sources.
In short
The Public Limited Companies Act B.E. 2535 (1992) governs how Thai public limited companies (the PLC form used by large property developers) are formed, capitalized, governed, and how they offer shares and debentures to the public.
Section 15: What a public limited company is
A public limited company is one set up to offer its shares for sale to the general public. Shareholder liability is capped at the amount still unpaid on the shares each holds. This corporate form is the vehicle large Thai developers use when they intend to raise capital broadly and eventually list.
Section 16: Promoters required to form the company
At least fifteen individuals are needed to act as promoters and establish a public company. The promoters drive the incorporation process, prepare the founding documents, and subscribe for the initial shares before the company opens its capital to outside investors.
Section 17: Qualifications of promoters
Each promoter must be a natural person of legal capacity, must subscribe for shares personally, and at least half must be resident in Thailand. People who are bankrupt or have certain disqualifying records cannot serve. These rules ensure founders are accountable and genuinely committed to the venture.
Section 18: Contents of the memorandum of association
The memorandum must state the company name, its objectives and business activities, the registered capital and how it is divided into shares, the location of the head office, and details of every promoter. This document defines the company's scope and is filed with the Registrar at incorporation.
Sections 24-25: Public offering of shares
When the company offers shares to the public, the offering must follow the securities and stock exchange legislation, and the related documents are submitted to the Registrar. This links company formation to capital-market regulation, which matters for developers funding projects through public issues.
Sections 50-52: Par value and pricing of shares
All shares of the company carry the same par value. Shares may be issued above par (at a premium) under prescribed conditions, and may be issued below par (at a discount) only after the company has operated for at least a year with losses. These rules protect capital integrity.
Sections 55-56: Issue and content of share certificates
The company must issue share certificates within two months of registration or of full payment for the shares. Each certificate must show the company name and registration number, the holder's name, a director's signature, and the issue date, giving shareholders documented proof of ownership.
Sections 57-58: Transfer of shares
A share transfer becomes valid through endorsement of the certificate and its delivery to the new holder. The company must record the transfer in its register, typically within fourteen days, so that the buyer is recognized as a shareholder and can exercise the related rights.
Sections 61-64: Register of shareholders
The company keeps a shareholder register at its head office recording each holder's name, nationality, address, and shareholding. The register is the authoritative record of ownership and is used to determine voting rights, dividend entitlements, and notices for meetings.
Sections 67-68: Board of directors: number and qualifications
The board must have at least five directors, and not fewer than half must reside in Thailand. Directors must have legal capacity and must not be bankrupt or carry disqualifying convictions for dishonesty. These requirements set the minimum governance structure for the company.
Section 98: Annual ordinary shareholders' meeting
An ordinary general meeting of shareholders must be held within four months after the end of the company's accounting year. This is where shareholders approve the financial statements, decide on dividends, appoint auditors, and exercise oversight of the board's stewardship.
Sections 99-100: Extraordinary meetings
Beyond the annual meeting, the board may convene extraordinary general meetings as needed, and shareholders holding the required portion of shares may demand one. This mechanism lets owners address urgent matters such as major transactions, capital changes, or governance disputes between regular meetings.
Sections 112 and 120: Accounting and audit
The board must prepare a balance sheet and profit-and-loss statement that an auditor examines. Shareholders appoint the auditor each year and fix the fee. Independent auditing gives investors reliable financial information, which is especially important when assessing a developer's solvency.
Sections 115-116: Dividends and reserve fund
Dividends may be paid only out of profits, never from capital. Each year the company must set aside at least five percent of its net profit into a legal reserve fund until it reaches the prescribed level. These rules safeguard creditors and the company's long-term financial base.
Sections 136 and 139: Increase and reduction of capital
Increasing the registered capital requires a shareholder resolution passed by at least three-quarters of votes and registration with the Registrar. Capital may be reduced only within limits and not below one-quarter of the total. These thresholds protect both shareholders and creditors from abrupt changes.
Section 145: Issuance of debentures
A public company may raise debt by issuing debentures to the public, but this requires a shareholder resolution carried by at least three-quarters of votes and must comply with securities law. Developers often use debentures alongside share offerings to finance large construction programs.