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International Journal of Law and Management: Converting debt into equity in private limited companies in Thailand
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Abstract
Purpose – The purpose of this paper is to critically examine the prohibition on debt-to-equity conversions
for private limited companies in Thailand, resulting from an interpretation of Section 1119 of the Thai Civil
and Commercial Code (TCCC) adopted by academics and the regulator.
Design/methodology/approach – This paper critically examines the interpretation of Section 1119 of
the TCCC made by academics, the Thai Supreme Court and the regulator. Taking an approach, which draws
on debate in the EU over the past two decades, this paper presents a new understanding of the rules relating
to legal capital in Thailand. This new understanding is applied to challenge the orthodox interpretation of
Section 1119.
Findings – The interpretation proposed by this paper is that debt-to-equity conversions may be permitted
when viewed as shares issued in return for payment in kind. This proposed interpretation is consistent with
existing Thai Supreme Court jurisprudence. In addition, a close reading of the provision, further supported by
a historical investigation into the legislative drafting process, reveals that it reflects the original intention
behind this provision.
Originality/value – This paper presents a view of Thai legal capital rules, which challenges the orthodox
understanding of their nature, purpose and categorisation. Furthermore, the proposed interpretation of
Section 1119 of the TCCC, if adopted by the regulator, would permit Thai private limited companies to engage
in debt-to-equity swaps without further legislative intervention.
Adam Reekie - Personal Name
NONE
Text
ENGLISH
EMERALD INSIGHT
2021
ENGLAND
JURNAL ILMU HUKUM
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APA Citation
Adam Reekie. (2021).International Journal of Law and Management:
Converting debt into equity
in private limited companies
in Thailand.(Electronic Thesis or Dissertation). Retrieved from https://localhost/etd