WORLD TRADE
ORGANIZATIONS/C/N/73
29 September 1998
(98-3765)
Council for Trade in Services Original:  English
NOTIFICATION PURSUANT TO ARTICLE III:3 OF THE
GENERAL AGREEMENT ON TRADE IN SERVICES
The following notification has been received from the delegation of Thailand.
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1. Member notifying:
Thailand
2. Notification under:
Article III, paragraph 3, of the General Agreement on Trade in Services
3. Date of entry into force:
29 June 1997
Duration:
Indefinite
4. Agency responsible for implementati on and enforcement of the measures:
Ministry of Finance and Bank of Thailand
5. Description of the measures:
Measure:
Emergency Decree amending the Act on the Undertaking of Finance Business, Securities
Business and Credit Foncier Business B.E. 2522 (No. 3) B.E. 2540 (1997)
Description:
The essence of the Emergency Decree is the addition of Chapter 5bis "the merger and transfer
of business" to the Act on the Undertaking of Finance Business, Securities Business and
Credit Foncier Business B.E. 2522 to encourage and remove obstacles to the merger and
acquisition of financial institutions which have been approved by the Minister of Finance.S/C/N/73
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The details of the amendments are as follows:
(1) The relevant articles of the Civil and Commercial Code which require prior
notification to the debtor of the transfer of claims on such debtor, shall be waived to
expedite the process of merger. (Amendment to Section 306).
(2) In the case of the core financial institution acquiring shares in another company for
the purpose of merging their operation, the Bank of Thailand shall have the power to
waive the prohibition of cross-directorship and allow directors, manager of personnel
with the power to administer, of such core financial institution to assume the position
of directors, managers or personnel in ailing finance companies.  The waiver shall not
be more than 5 years. (Amendment to Section 22).
(3) In the case of an urgent need, a merger which has been approved by the Minister of
Finance upon recommendation of the Bank of Thailand can be made through a
proposal of the Board of Directors or th at particular finance company.  The
company's creditors shall not have any right to object the merger, irrespective ofwhether such finance company is privately or publicly-owned.  The creditors or any
other party, shall not have the right to file for bankruptcy during the process of
merger or transfer of businesses.
(4) Financial institutions undertaking a merger or transfer of businesses as approved by
the Minister shall organize a shareholders meeting, but may shorten the period
normally used to call for a shareholders meeting (no less than 7 days and no more
than 14 days).  Public notification or advertisement of such meetings shall be made
no less than 3 days prior to the meeting date.  However, the merger or transfer of
businesses shall be made legal in the case than no less than three-fourths of theshareholders approve.
(5) Finance companies proposing the merger or transfer of businesses and the core
financial institutions shall be exempted from related fees and other taxes arising from
the merger or transfer or businesses as stipulated by the Cabinet.  The exemption may
be made across the board or on a case-by-case basis.
(6) In granting the approval for the merger or the transfer of businesses, should there be a
need for financial assistance from the Financial Institutions Development Fund, the
government shall compensate the Fund as deemed appropriate.
6. Members affected:
None
7. The texts are available from:
Ministry of Finance
Fiscal Policy Office
Monetary Policy and Financial Institution Division
Rama VI Road
Bangkok 10400
Telephone: (662) 273 9020 ext. 3231-3
Telefax: (662) 618 3367S/C/N/73
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Bank of Thailand
Samsen Road
Bangkok 10200
Telephone: (662) 283 5353
Telefax: (662) 280 0449
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