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ResourcesCorporate and Tax AdvisoryThailand Corporate LawThailand Corporate Law: Director Signing Authority

Thailand Corporate Law: Director Signing Authority

Transcript of the above video:

In this video today as the title suggests we are going to be discussing Directorships in Thailand; specifically Corporate Directorships and the signing authority associated therewith.

What are we talking about when we are discussing signing authority? Well we are talking about the ability of a Director to bind  the company through their signature on various types of government or otherwise financial documents, just documents generally that can bind the company to obligations or future obligations or financial obligations; basically any sort of obligation on the company.

Why do we bring this up? Well because different corporate structures, different companies, may require different types of signing authority structures. So for example if there is a Company with two directors and they are both working closely together, in fact in many cases they may have both invested the money to set the Company up, the decision is sometimes made to require that both Directors’ signatures be present with respect to signing documents pertaining to the Company. Moreover there is also directorships that have no signing authority; non-executive directorships which cannot bind the Company whatsoever.  They are a non- signing director. They are just a director with non-executive capabilities. Furthermore in theory I guess you could have a large number of people that have to constantly sign with respect to binding the company or creating obligations for the Company. A note on these types of issues is when you have multiple directors especially where there are foreigners involved or multiple directors on a Thai Corporation, requiring multiple signatures for binding and for certain documentation can be quite cumbersome because many times the Directors are not both in the country at the same time which can create logistical problems to say the least or in situations where you have got foreign directors, one or more may not have a work permit, and said signing documentation pertaining to the Company may be required pursuant to the regulations provided by the Labor Ministry especially  for those who are Directors here in the Kingdom as signing documentation can be construed as work pertaining to the company. So for these reasons it is probably a good idea to consult with legal professionals regarding signing authority of Directorships on a Company here in the Kingdom of Thailand.