Tag Archive: agreement

  1. Reasons for a Gift Agreement

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    Valuable gifts such as condominium units, houses, and cars are not uncommon in Thailand, and most such gifts are made for specific reasons. The reasons for such gifts could not be more diverse, and personal disappointment might lead to great regret.

    Therefore, it is advisable for both parties, donors, and done, to think about protective measures. A gift agreement between donor and donee is a proper way to protect the interests of both sides.

    The reason why such a contract is beneficial for the donor is that the gift agreement may help the donor to revoke the gift for an act of ingratitude under Section 531 of the Thai Civil and Commercial Code (CCC). An act of ingratitude is given if the donee:

    • committed a serious criminal offence against the donor,
    • seriously defamed or insulted the donor,
    • refused the donor who is in need of the necessaries of life while the donee was able to supply the donor

    Further, if the gift is encumbered with a charge and the donee fails to perform the charge, the donor may demand the return of the gift, Section 528 CCC.

    The donee, on the other hand, is entitled to claim the promised gift or its value on the basis of such an agreement, Section 526 CCC, if there is a written agreement. A written contract is the best way to give evidence especially in cases of a heritage dispute. After the death of the donor, such a gift agreement may be evidence enough that the asset, which is the matter of dispute, was given as a gift. The gift agreement may prevent the unpleasant situation that the donee is forced to return the gift to the heir.

    Setting up a gift agreement helps to secure the rights of both parties and is highly recommended for valuable gifts; it helps to prevent any misunderstandings between the parties which might lead to emotional distress and further damage.

    Please contact us if you have any questions about this topic [email protected]

  2. Joint Venture Agreement

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    A joint venture (JV) is a business arrangement in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task.

    If two previously independent companies form a new company, or if they decide that one partner will invest in the other, then a so-called “equity joint venture” is formed. Another option for cooperation is the so-called “contractual joint venture”, in which two companies coordinate their business activities.

    Regardless of how they coordinate business activities, it is important to define the mutual interests as clearly as possible, to create synergies and not to conceal differences. After all, it’s all about trust, especially in international business dealings. At the same time, the agreement must be legally sound and secure.

    That is why joint venture companies with foreign partners rarely come about at short notice. In most cases, the establishment of a joint venture company is preceded by a long phase in which the partners work together in a different capacity. A typical situation is that the foreign partner previously worked for the local company in one way or another on the foreign market. If the local entrepreneur realizes that the founding of his own company can give him greater opportunities for influence and flexibility, and sometimes also tax benefits, he will face the decision to either give up the former partner or to work together with him. For the latter — apart from the usual considerations on synergy effects, loss of know-how etc. — especially in foreign countries, it can be said that the trust that has grown in possibly years of cooperation is highly valuable, and should not be abandoned lightly.

    The formation of a new company involving at least two partners is generally preceded by the negotiation of a joint venture agreement. The joint venture contract is not to be confused with the Articles of Association of the company, one of the founding documents of a limited liability company (often referred to as “bylaws”). Rather, a joint venture agreement is the private agreement of the future shareholders on the intended and stipulated structure of the company, the relationship of the shareholders to each other, fundamental questions of business policy and the rules on the formation of a common prior to the actual formation of a company. The joint venture company will, if necessary, also have obligations to be entered into, such as to the shareholders.

    Typically, a joint venture contract governs the following issues:

    – Legal form, name and registered office of the joint company
    – Amount of the respective shareholding or their proportional relationship to each other
    – Purpose of the company
    – Desired start and end of business
    – Fiscal year, time and place of the shareholders’ meeting
    – Deviating from the statutory quorums and majorities in shareholder meeting and board or other bodies
    – Special resolutions
    – The nomination right for positions to be filled within the new company
    – Restrictions on the transfer of shares
    – Rules for increasing capital
    – Non-competition clauses
    – Confidentiality clauses
    – Corporate authorizations
    – Termination provisions
    – Conflict resolution mechanisms

    The Joint Venture Agreement may also include other matters, such as the text of the Company’s Articles of Association or a list of persons who are to take up certain positions at the beginning.

    For further information, please feel free to contact us: [email protected]

  3. Prenuptial Agreement

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    Many foreigners living in Thailand meet their future spouses here and get married in Thailand. And to deal with potential legal issues in advance, the couples often chose to enter into a prenuptial agreement (often referred to as “prenup”).

     

    According to the Thai Civil and Commercial Code (“CCC”), the prenup agreement is valid when it is:

    1. entered in a form of the marriage registry or
    2. prepared by the spouses in writing, separately from the marriage registry, signed by both spouses and by at least two witnesses and entered in the marriage register stating that the prenup agreement is thereto annexed.

     

    And according to the Ministry of the Interior Regulation Regarding Family Registration B.E. 2541, both spouses and 2 witnesses must sign in the marriage register (Form Kor Ror. 2).

     

    The witnesses of the prenup agreement can be the witnesses provided by the marriage registry.

     

    No lawyer nor an interpreter is required to attend the district office. Lawyer and interpreter may attend the district office as witnesses. In case that the spouse is foreigner, the registrar shall examine the evidence to identify such foreigner (passport, certificate from the embassy in Thailand) and shall examine the qualification of the foreign spouse (single status certificate) before register the marriage. The certified translations are required.

     

    According to Section 1466 CCC, “the ante-nuptial agreement is void if not entered in the marriage register at the time of marriage registration terms of the ante-nuptial; or if not made in writing and signed by both spouses and by at least two witnesses and entered in the marriage register at the time of marriage registration stating that the ante-nuptial is thereto annexed.”

     

    It is notable that any clause in the prenup agreement contrary to public order or good morals, or provisions to the effect that the relations between the spouses as regards to their properties are to be governed by foreign law, shall be void (Section 1465 CCC).

     

    After registration of the marriage, the prenuptial agreement cannot be altered except by authorization of the court (Section 1467 CCC).

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