Welcome to the installment of DLA Piper Alerts on Thai laws. The continuing series seeks to provide an overview of laws of Thailand and legal updates on a targeted basis.
The Business Security Act B.E. 2558 (2015) (the BSA), which came into effect as of 1 July 2016, has improved the legal framework supporting secured lending transactions in Thailand. Prior to the BSA, Thai law only provided for security interests to be created via "mortgage" or "pledge". This limited scope restricted lenders from accessing on a secured basis the borrower's movable assets (such as inventory and stock-in-trade); In common law countries, such movables assets are regularly secured via the common law concept of the "floating charge".
Pursuant to the BSA, parties are now permitted to enter into a "Business Security Contract" in order to create a new form of security interest recognized under Thai law and which seeks to achieve the same commercial and practical effect as the common law "floating charge".
Please click here to read "The Thai Business Security Act 2017"