Duensing Kippen Tax and
Law
If you started a business here in Thailand, you probably
did so by setting up a Thai company limited. All Thai limited companies are
required to have and to report to the authorities a registered
address, pursuant to Section 1148 of the Civil and Commercial Code (the “CCC”).
And, pursuant to Section 14 of The Offences Relating to Registered
Partnerships, Limited Partnerships, Limited Companies, Associations and
Foundations Act (1956) and as amended (the “Juristic Persons Offences Act”)
if a Thai limited company does not comply with Section 1148 of the CCC, such
company will be subject to a fine of up to Thai baht twenty thousand. In
addition, the director of such a company limited will be personally liable
for another fine in an amount up to Thai baht fifty thousand, under Section
25 of the Juristic Persons Offences Act.
The requisite registered address need not be evident to
all or anyone for that matter, it need only be an actual address and
registered. However, if the business your limited company conducts requires
its office location to facilitate its business activities and interactions
with others, then chances are you put up a sign at your company’s registered
address to market your business and let the public know where your place of
business is located.
When you did erect a sign, you may have been told, and
thought, that you must comply with two very common misnomers. These
misnomers, in our opinion, are based on misunderstandings of the relevant
law. The first misnomer is that you must put “company, limited” or some
abbreviation thereof on your sign. In this Part I of our two part article we
have a closer look at this first common misunderstanding. And in order to
understand this legal misnomer we must, as always, turn to the actual
relevant law.
So is the following assertion true? - “You must have
‘company, limited’ on your business sign.”
Quite simply, it is not. But why do so many seem to think
it is true? Most certainly it is due to Section 5 of the Juristic Persons
Offences Act which states, in pertinent part, the following: “If a limited
company, except one operating a bank, expresses its name in its commercial
seal, sign, brochure, letter, notification, or any other document relating
to its business ... in a language other than Thai, without words or phrases
that mean ‘limited, company ‘... (such company) shall be liable to a fine
not exceeding Thai baht twenty thousand and a fine of Thai baht five hundred
per day until (such company) has complied with the requirements under this
Act.”
Note well, however, that although the Juristic Persons
Offences Act requires a Thai limited company to include words communicating
that it is, indeed, a limited company when it expresses its company name
in a business sign, it does not require that the company use its
company name in any business sign it puts up. In other words, a business run
by a Thai limited company would be just fine and legally compliant by
putting a business sign with, for example, its mere logo, without its
company name.
It should also be noted that the opposite holds true as
well. Under Section 6 of the Juristic Persons Offences Act, if your
enterprise is not a registered limited company and you proffer its
name in wording that implies that it is a limited company, then you will be
subject to a fine of Thai baht twenty thousand and a daily fine of Thai baht
five hundred for each day until you cease doing so.
Therefore, if you put a sign at your office, it is not
true that: “You must have ‘company, limited’ on your business sign”.
We will examine the second common legal misnomer
regarding business signs in our next column.
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Duensing Kippen is a multi-service boutique
law firm specializing in property and corporate/commercial matters
and is also the only such firm in Thailand that compliments its
property and corporate/commercial legal expertise with a core tax
law practice. Duensing Kippen can be reached at: [email protected]
or for information, visit them at: www.dktaxandlaw.com |
