Termination of Directorship
Have you ever been like this? You have been the director of a company, but, one day, you resigned your directorship. However, your name was not removed yet; it still existed and made another person looking at the Company’s Affidavit misunderstand that you still held the office. Sometimes, if you are a celebrity, it may be likely that such company did not require registering a change of its director or deleting your name from the Company’s directorship since your name might be employed somehow or be mentioned for some matters.
Previously, the Civil and Commercial Code (“CCC”) did not prescribe about the Company’s undertaking in case of director’s resignation; only the appointment of new director is mentioned stipulating that a company shall register the appointment of new director within 14 days upon the appointment date.
When no provision prescribes the specific period notifying the resignation of a company director, and the said circumstance occurred. Such resigning director certainly got in trouble because his/ her name still existed. However, later on, CCC. was amended and prescribed that “a director of any company shall submit a written notice to the company notifying his/ her resignation from office. His/ her resignation shall be effective upon the date of receipt by the company.” Moreover, CCC. was also added that “Once the directorship ends, the Company is required to update the register of directors within 14 days from the Changing date.” Therefore, now, once you resign your directorship, the company shall be responsible for notifying the director’s resignation to the related authorities, that is, the company no longer takes advantage your name for any longer.
The next issue is that if that company fails to update the register of change, what will be the consequent result? Section 13 of the Act governing Liability of Registered Companies, Partnerships, Associations and Foundations prescribes that failing to register any change of directorship; the company shall be liable to a fine not exceeding Baht 20,000.
Do you realize that, sometimes, your rights may be ignored? You should take care of your rights carefully. We would like to give you certain advice that upon resigning your directorship, you must ensure that your resignation is recorded in writing by checking it with the Department of Business Development.
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