In Thailand, Bankruptcy Laws form part of the Commercial Law. Thai bankruptcy law is devised in such a way not only to help debtors to distribute their property but also to help them in rehabilitating via several reorganization provisions.

In other words, the Bankruptcy Law includes the Bankruptcy Act for Business Rehabilitation. The Business Rehabilitation Law was introduced in 1999 as Chapter 90 of the Thai Bankruptcy Law BE 2483. The main purpose of the Business Rehabilitation law is to assist a debtor facing liquidity problem by giving him an opportunity for rehabilitation before being insolvent.

The procedures in connection with rehabilitation are usually commenced by an eligible petitioner by filing a petition with a provincial or a civil court as per the domicile of the debtor. However, petition for business rehabilitation could be filed only if the debtor’s overall debt comes to an amount that exceed Baht ten million. Likewise, In order to file a petition for business rehabilitation, certain legal and perquisites must be complied with such as:

- The names and addresses of creditors must be specified to whom the debtor owes in total at least an amount of Baht ten million

- Specify reasonable methods in order to rehabilitate business functions

- Proposed planner’s name as well as qualification

- Planner’s consent

- In case the petitioner is debtor, then details regarding assets and liabilities must be given

- Consent of authorities which is applicable as mentioned below :

1.In case the debtor is commercial bank or finance company, then the consent of the Bank of Thailand

2.In case the debtor is a securities company, then the consent of the Office of the Securities and Exchange Commission

3.In case the debtor is a file insurance company or a casualty insurance company, then the consent must be of the Insurance Department

On filing the petition as per the above grounds, the liquidator will start the case once when he confirms and proves that the debtor’s assets could not pay off liabilities. The court’s concern with regard to the business rehabilitation is mostly on the basis of debtor’s balance sheet as well as accounting documents and liquidator’s power of arguments. Discussed further in detail in this article are procedures with regard to business rehabilitation.

According to the Article 90 of the Bankruptcy Act, once the petition for business rehabilitation is accepted, a planner is appointed, who in turn possesses duties and powers to manage the debtor’s business as well as assets. In case, a planner is appointed, then the debtor executive’s power in administering the business and assets would cease. In such a situation, until the appointment of a planner, the court will employ one or more persons or sometimes the debtor’s executive for a temporary period to deal with the debtor’s business and assets under the administration of the receiver.

During this interim period, the receiver has complete right to administer interim executives and to order them to prepare explanation regarding the account details as well as anything pertaining to the management of business and assets. The interim executives would be relieved from the powers of receiver by the court when the receiver makes a motion.

In such situations, the court would employ new provisional executive to presume the office. In case the court does not appoint interim executive, then according to the Section 90/20 of the Bankruptcy Act, the receiver would be given power for a temporary period to manage debtor’s business and assets. Likewise, according to the Section 90/21 of the Bankruptcy Act, until a planner is appointed, all of the rights of the debtor’s shareholders would be suspended except for in the case of right to obtain dividends.

Once the acknowledgement order for business rehabilitation has been received, the debtor’s executive should handover everything from assets and seals to book keeping ledgers and documents pertaining to business, assets, and liabilities of the debtor to the provisional executive or the receiver.

Nowadays, a number of leading law firms is in the scenario to provide excellent services in connection with business rehabilitation and bankruptcy. Many of them undertake a plethora of such services in connection with business reorganization as analysis as well as consultation with creditor or debtor, filing petition for business rehabilitation, plan administration, and planner representation.

Chapter 7 Bankruptcy

Bankruptcy is defined as a legally declared inability or incapability of an individual or organization to pay their creditors. Personal bankruptcy is an option limited to individuals who are bankrupt and does not include organizations or companies.

The main objective behind filing a bankruptcy is to absolve financial debts and make a fresh start. Individuals can file for personal bankruptcy under chapter 7 of the bankruptcy act after they take a credit counseling course, completed an approved financial management course before discharge and after passing the ?means test?.

Debtors filing Chapter 7 or Chapter 13 bankruptcy must present a copy of a tax return or transcription of a tax return of the period for which the return was most recently due to the trustee, at least seven days before the 341 meeting

The documentation required for filing for personal bankruptcy includes a list of creditors, detailed description of current income, current personal expenses, and an identification photograph. Under the new bankruptcy laws a person also has to submit a certificate of counseling and a proof of income for the last six months. Proof of income includes copy of paycheck, a pay stub, bank statements, rental agreements, books and records, or any other evidence of income a person has received within six months of filing. The last 60 days worth of paycheck stubs must also be filed along with the bankruptcy paperwork in the bankruptcy court.

A statement of monthly net income and any anticipated increase in income after the filing should also be mentioned. All the tax returns or transcripts for the previous four (4) tax years are to be submitted. Tax returns that were not filed during the bankruptcy case will also be needed. Other documents include copies of deeds, mortgages and titles to vehicles, copy of the individual?s automobile financing agreement and any creditor?s mail that the person has received within the last 90 days before filing. Copy of security agreements with secured creditors and copies of divorce decrees, property settlement agreements, separation agreements and child support orders also have to be included along with an application for personal bankruptcy. It is always advisable to contact an attorney before filing for personal bankruptcy.

To learn more about debt relief and how to get started, please visit Debt Relief.bz

The new bankruptcy law will soon be in effect

The new bankruptcy laws will be in effect before the end of the year. This is devastating news to those who are already in debt or facing possible future debt. However this is good news to most businesses no longer having the need to file for as much profit loss as some had to in the past.

Once the new bankruptcy law goes into effect it will be almost impossible for some individuals to file for bankruptcy. Chapter 13 bankruptcy will be the most likely step anyone can take to file at all.

Chapter 13 bankruptcy is more like debt consolidation. Unlike the other options of filing like Chapter 7. Chapter 13 does not liquidate your assets and pay for any of your debts. The individual is still responsible for paying off their debts. It is a plan that is determined by the courts and payment arrangements are then made. Unlike going through a debt consolidation service your allotted time to pay of your debts is determined by the courts.

With the future change in the bankruptcy laws people should start planning new ways to avoid the need to ever file.

A mistake that is often made by people is over use of their credit cards. Most individuals do not have a back up plan if they were to ever face a loss of income. If they were to be laid off from their job or face an injury that took them out of work for an extended period of time. How would they pay off their minimum credit card payments? Other things like mortgage and car payments are another factor. Another mistake is not having medical insurance for unexpected hospital bills if one was to get into any accident or suffer a major illness. Most individuals are not prepared to pay those kinds of expenses.

Putting extra monthly cash into a savings account is one way to plan for future unpredicted expenses. Having a financial back up plan is a good strategy to avoid the need to ever file for bankruptcy.

A major cause to the change in the bankruptcy laws is do to some people abusing their credit cards and then filing to erase their mistake. Also some people have made the same mistake and have filed more then once.

There are a lot of people that find this decision unfair. Unfortunately we can not change the decision that was made by our federal government. Those who did nothing wrong to fall into debt will have to pay the same price for those who have abused the system.

All we can do as a whole is carefully plan our financial needs and have a back up plan to avoid falling into debt. Eliminate the need to ever have to file for bankruptcy.

For those who need help with debt, bankruptcy is an option that can be considered alongside an IVA and debt management. Whilst bankruptcy may seem to have a stigma attached to it, that has long since disappeared.

You will lose your debt liability immediately.

As soon as you are bankrupt you become debt free. This is unlike the IVA in which you need to complete 60 months in the IVA before the balance of the debt which is unpaid is then written off.

In debt management you must continue to pay the debts until they are written off in full, and whilst the charges and interest may no longer be added, it can still take a long time to pay off the balance.

You will be bankrupt for only one year.

Unless you have been culpable in your bankruptcy you will automatically be discharged after one year. Contrast this to and IVA where you will usually be required to enter into a contract for repayments for 5 years. If you are in debt management, the length of time that you re-pay your debts will depend on the amount of debt that you have and the amount that you are repaying each month.

You can keep your car

If you have car valued less than £2,000 and you need it to get to work, you can keep it without any questions. If you also have a car on finance you may be allowed to retain it if the finance company agree.

You may be able to keep your house and have it transferred back to you.

Bankruptcy is a legally declared state in which a person or business becomes insolvent, meaning they are not in a position to pay their creditors. There are several causes of insolvency, among them are uninsured chronic diseases which requires the sick to be hospitalized for long periods of times. Bills may escalate to a point where they cannot be paid forcing the debtor to file a petition voluntarily. In the involuntary case, creditors may decide to file a petition in court against the alleged debtor.

After the petition is filed, the court appoints a trustee to oversee the proceedings. This court official is also known as a bankruptcy administrator. They have the responsibility to oversee that the debtor is not harassed by the creditors. It is also a way of relieving the him the responsibility towards the property. Once this property has been handed over to the court, it ceases to have the name assets and becomes estate.

There are three rules mainly used by the courts in the process of insolvency solution. The first rule is that the property should be proportional to the agent claim. This insolvency solution rule is applicable if the petition has been filed under chapter seven of bankruptcy. It cannot be used under chapter nine since the municipal has no property on its own.

The second rule is the equal award division of the estate which requires for the estate to be divided equally in such a manner that none of the creditors get more than their claim on the property. The last and final rule in insolvency solution is the equal losses rule that states that the estate should be divided in such a manner that none of the creditors get a loss more than their claim.   

Peter Gitundu Researches and Reports on Bankruptcy. For More Information On Bankruptcy Solutions, Read More Of His Articles Here <a rel=”nofollow” onclick=”javascript:pageTracker._trackPageview(‘/outgoing/article_exit_link’);” href=”http://gitundu.com/”>BANKRUPTCY SOLUTIONS</a>You Can Also Add Your Views About Bankruptcy Solutions On His Blog Here <a rel=”nofollow” onclick=”javascript:pageTracker._trackPageview(‘/outgoing/article_exit_link’);” href=”http://gitundu.com/2009/04/21/refinancing-after-bankruptcy/”>BANKRUPTCY SOLUTIONS</a>