Qualifications of Planner and Plan Administrator

To supplement the implementation of Thailand’s Bankruptcy Act (1940), as amended, the Thai Ministry of Justice has recently issued a ministerial regulation (the Regulation) that governs the reorganisation of the debtor’s business “Reorganisation”, Reorganisation proceedings can be initiated by the debtor and/or his creditors in lieu of moving for bankruptcy and an outright receivership for liquidation of the whole of the debtor’s assets. As the title of the Regulation suggests, the Ministerial Regulation on the Registration and the Prescription of Qualifications of the Planner and the Plan Administrator (2002), which came into force on 17 May 2002 requires that a planner or a plan administrator apply for a licence with a committee (the Committee) set up for the purpose in accordance with the Regulation before he or she can act in that capacity.

The principal purpose of the Regulation is to have a government agency in place that can supervise the conduct and performance of the professional planners and plan administrators and to ensure that these professionals possess the necessary qualifications prescribed by the Regulation and the Committee. The Committee is empowered to issue, renew, suspend and even revoke licences, and to order the applicants to supply any additional information or to appear before it to give statements or other clarifications it deems necessary. The Committee has 30 days, and  in special cases a 30-day extension, to process an application. If no decision is made within either of these periods, an approval is deemed to have been given to an application.

In case of a rejection of an application, an appeal to the Thai Justice Minister is permissible within 30 days of becoming informed of the rejection. The minister must give a ruling within 30 days and his decision is considered final.

A planner’s licence is valid for two years from the date of issue, while a plan administrator’s licence is good for five years.

The Committee comprises government and private sector representatives whose responsibilities and experience range from law and securities, to accounting and auditing, and from banking, finance, and commerce to other diverse industries.

Under the Regulation, a natural person, a body of persons, or an incorporated entity can act as planner or plan administrator provided that those persons are qualified. However, the Regulation does not apply to cases filed before or within 90 days of its issuance.

For an individual (or a body of individuals) to qualify, the applicant must be Thai, having graduated with a bachelor’s degree in finance, accounting or law, with at least three-years experience in any of these aforementioned disciplines. However, it is sufficient for a plan administrator to hold a bachelor’s degree in any field and has at least three-years experience in business administration. Further, the applicant must not be or have been subject to an imprisonment term pursuant to a court judgment at the time of the application or under a final judgment in a case which the Committee believes may affect the dignity of the professions relating to business reorganisation. Lastly, the applicant must have no receivership order issued and pending against him.

Regarding incorporated entities applying for a planner or plan administrator license, one of its registered purposes for doing business must be providing advisory services in finance, accounting or law (or business administration in the case of a plan administrator), and/or managing the business and assets of another person.

At least, three persons whose work is concerned directly with the business of a planner or a plan administrator within the organisation (and half of the number of those persons in the line of duty must be of Thai nationality) must be working full time with at least three-years experience, each of whom holds bachelor’s degrees. At least one of them must have knowledge in finance or accounting (or business administration in the case of a plan administrator). In addition, the executives of the incorporated entity must be capable, experienced, honest, have never been dismissed or suspended from duty or prosecuted for dishonesty, commission of any offence or the commission of grossly negligent act and shows a want of accountability or care in business administration.

On the application date, a general bond of 500,000 baht must be deposited as security for damage that may arise in connection with the discharge of a planner’s or a plan administrator’s duty. Further, before consenting to acting in the capacity of a planner or a plan administrator, a specific bond of between 200,000 and 10,000,000 baht must be given depending on the amount in controversy which may range from 10,0000,000 baht to upwards of 5,000,000,000 baht. A bond can be in the form of cash, a letter of guarantee issued by a bank or finance company operating in Thailand, or any other security permitted by the Committee.

 A planner or plan administrator may apply to redeem a certain of the bond upon any reduction in the amount in controversy. Otherwise, a general bond must be returned within 30 days of request upon the planner or the plan administrator having been disqualified. The specific bond will be refunded upon (i) the planner or the plan administrator having been disqualified, (ii) the revocation of the application for reorganisation, the court order for a business reorganisation or the reorganisation itself, (iii) a replacement planner or plan administrator being appointed by the court, or (iv) or the imposition of a final receivership order on the debtor’s assets.

If a court action is entered against a planner or a plan administrator for recovery of damages, redemption of the bonds may be suspended for a period not exceeding 60 days.

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