Status of Directors 

Appointment of Directors: 

The basic requirements for becoming a director in a Thai company are that the director be a natural person twenty years of age or older who is not incompetent or bankrupt. Foreigners and non-residents are generally allowed to act as directors. However, there are certain requirements that a company have a specific number of Thai and/or resident directors.

In contradistinction, however, companies which exist under the Treaty of Amity and Economic Relations between the Kingdom of Thailand and the United States of America are required to have a majority of directors who are American. 

A general meeting of the shareholders of a company is required upon appointing a director. If a position on the board of directors becomes vacant, the remaining directors may fill the vacancy for the unexpired term of that director, provided there is no prohibition by the company's articles of association.

A general meeting of shareholders is also required to remove a director. However, if a director becomes bankrupt or incompetent, he or she may be removed without a general shareholder meeting. 

With regard to public companies, directors are elected for a three year term and Thai law dtipulates that at least one-third of the directors retire annually. Retiring directors are however eligible for re-election. It seems to be common practice in some cases to have all the directors resign each year and then re-elect them. 

Remuneration is required to be paid periodically to directors who are also employees. Directors who also serve as employees are also entitled to compensation and severance pay as well as other benefits that employees are regularly entitled to. Work permits are required for those foreign directors who act as directors in Thailand. If certain documents such as applications for telephone lines or custom card applications are signed by a foreign director, that director must be in possession of a work permit on behalf of the company involved. If this is not done, the signed document may be rejected by the governmental agency concerned and the acting director may also be subjetc to other legal risks. 

 

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