What happens to the minority shareholders in a company when a company is dissolved and the home sold?

[Thomas J]

15 minutes ago, Yellowtail said:

The three Thais in your example would be on the board and would likely not vote for this , BUT in the event did want vot to give away their money they could.

 

A board vote is different from a shareholder vote.

It is obvious you are clueless as to how corporations work.  So there is absolutely no sense in trying to explain anything to you.  Somehow you believe that because they are minority shareholders they are entitled to nothing.  Now I know why your was a lawnmowing and shoeshine business. 
 

[Yellowtail]

42 minutes ago, Thomas J said:

It is obvious you are clueless as to how corporations work.

Yeah, you keep saying this because it's all you have. You are not able to actually refute anything I have said.

 

42 minutes ago, Thomas J said:

So there is absolutely no sense in trying to explain anything to you.

Exactly, that would require you actually understood what we are talking about.

 

42 minutes ago, Thomas J said:

Somehow you believe that because they are minority shareholders they are entitled to nothing.

You keep regurgitating this as well and it is just not true. If I believed you were actually reading and comprehending what I have been saying I would call you a liar. 

 

42 minutes ago, Thomas J said:

Now I know why your was a lawnmowing and shoeshine business. 

Yes, I cut grass and shined shoes when I was a kid, that was long before I retired as a low level director of a Fortune 200 company managing operations in Thailand and a few other countries. 

 

It seems to be your position that you are smarter than every attorney in Thailand and the you and you alone have discovered that hundreds of thousands of minority shareholders are being cheated out of what is rightfully theirs. 

 

Were this true, a second year law student could go through the public records, find all these people and recover all of this money. 

 

 

[Thomas J]

1 hour ago, Yellowtail said:

 

It seems to be your position that you are smarter than every attorney in Thailand and the you and you alone have discovered that hundreds of thousands of minority shareholders are being cheated out of what is rightfully theirs. 

I did not say that. What I did say is that the Thai attorneys must have included a mechanism in these companies that facilitates the minority shareholder getting nothing. That was the question in the original post. 
 

As to a second year law student ask them if you own shares in a company and the company declares a dividend or cash distribution of capital whether you are entitled to it. 
 

If minority shareholders in any company were not entitled to any ownership rights you would not have any publicly owned companies in Thailand. And there is no difference between the ownership right of closely held versus publicly offered stock 

[donx]

9 hours ago, Thomas J said:

I did not say that. What I did say is that the Thai attorneys must have included a mechanism in these companies that facilitates the minority shareholder getting nothing. That was the question in the original post. 
 

As to a second year law student ask them if you own shares in a company and the company declares a dividend or cash distribution of capital whether you are entitled to it. 
 

If minority shareholders in any company were not entitled to any ownership rights you would not have any publicly owned companies in Thailand. And there is no difference between the ownership right of closely held versus publicly offered stock 

I'm not going to pretend to be an expert on this subject, but based upon everything I have read about the use of a Thai company to acquire property, it is my understanding that the mechanism that facilitates the minority shareholder getting nothing is the use of a board of directors meeting where the decision is made to sell the property and distribute all proceeds to the managing director.

 

Whether that is legal or not, that is my understanding of what happens. Perhaps a forum member who has sold their property owned by a company to a Thai can enlighten us on how they were able to transfer the proceeds of the sale from the company to their personal bank account - assuming that is what they did.

 

Note also that, legally speaking, the Thai shareholders are supposed to provide funds in proportion to the shares they receive which I think rarely if ever occurs with these setups. I remember reading about Land Offices checking the bank accounts of all the shareholders of a company buying property when the managing directory is a foreigner to see if they are proxies or real investors in the company.

[Thomas J]

9 hours ago, donx said:

t is my understanding that the mechanism that facilitates the minority shareholder getting nothing is the use of a board of directors meeting where the decision is made to sell the property and distribute all proceeds to the managing director.

I would not think that could be the case.  Otherwise any company with the majority vote could just vote to only give proceeds to a select group of shareholders.  I read the Thai law and it does say that minority shareholders are entitled to their proportionate share of any dividends.  

Money is distributed to shareholders in two ways.  1. a dividend  or 2. a return of capital.   In either case shareholders get a proportionate amount.  If there are 1000 shares and I have 500 I get 50% of whatever dividend or return of capital is distributed. If that were true companies like Siam Cement which are publicly traded could just have a vote where the majority shareholders voted to sell the company and distribute the money only to them. 

I can see legally only one way and that is to not sell the home which is an asset of the company but rather the managing director sells the shares it owns.  The new owner really just steps in and replaces the existing owner and the company continues.   That is not to say that some company owners just don't sell the home, pocket the money and move back to their home country.  After all what would the minority shareholders do.  They probably don't even know the home that is the asset let alone that it has been sold.  While that gets the money back to the foreigner it "technically" would not be legal.  But legal and having any true negative consequences are two different things. 

 

[Thomas J]

21 hours ago, Yellowtail said:

Were this true, a second year law student could go through the public records, find all these people and recover all of this money.

https://lorenz-partners.com/rights-and-protection-of-minority-shareholders-in-thailand/

[Yellowtail]

43 minutes ago, Thomas J said:

https://lorenz-partners.com/rights-and-protection-of-minority-shareholders-in-thailand/

You should tell all the second year law students so they can go through the public records, find all these people and recover all of this money. they'll all get rich!

 

You crack me up.

[donx]

9 hours ago, Thomas J said:

I would not think that could be the case.  Otherwise any company with the majority vote could just vote to only give proceeds to a select group of shareholders.  I read the Thai law and it does say that minority shareholders are entitled to their proportionate share of any dividends.  

Money is distributed to shareholders in two ways.  1. a dividend  or 2. a return of capital.   In either case shareholders get a proportionate amount.  If there are 1000 shares and I have 500 I get 50% of whatever dividend or return of capital is distributed. If that were true companies like Siam Cement which are publicly traded could just have a vote where the majority shareholders voted to sell the company and distribute the money only to them. 

I can see legally only one way and that is to not sell the home which is an asset of the company but rather the managing director sells the shares it owns.  The new owner really just steps in and replaces the existing owner and the company continues.   That is not to say that some company owners just don't sell the home, pocket the money and move back to their home country.  After all what would the minority shareholders do.  They probably don't even know the home that is the asset let alone that it has been sold.  While that gets the money back to the foreigner it "technically" would not be legal.  But legal and having any true negative consequences are two different things. 

 

I did a Google search of the phrase "selling my thai company property site:forum.thaivisa.com" which yields a few good threads by people that sold their property owned by a Thai company:

 

https://aseannow.com/topic/982564-sell-condo-thai-company-name-incomeprofit-tax/

This first link describes someone that owned a condo using a Thai company. It is interesting in that he sold the condo to a Thai at a loss and the sold the Thai company a year later to someone else. He doesn't say anything about the minority shareholders and my guess is that they never contributed to the purchase of the property in the first place.

 

https://aseannow.com/topic/982564-sell-condo-thai-company-name-incomeprofit-tax/

This next link is more relevant to your initial question. One of the posts by khunPer is of particular interest:

 

"The house is owned by a company, so cannot be sold without a bord meeting, or general assembly. Who are members of the bord, i.e. listed as directors – might be only one – and who owns the minimum 51% Thai majority shares?

 

Does the wife own any shares in the company (she might have been used as nominee shareholder)?

 

You friend have two options with company owned property...

 

1) Sell the property – after the paperwork with meeting reports have been fulfilled – pay the taxes, and close the company; the remaining capital should be paid to the shareholders in accordance with their number of shares.

 

2) Sell all shares in the company, the new shareholders will own the house, because they own the company. This method is often used when foreigners are trading property held by a company limited-shell. No transfer fees and property gain tax. Any gain received by the shareholders, when paid for their shares, might be income taxable (only gain from SET listed stocks are tax-free, to my knowledge), depending of how the shares are paid for, i.e. domestic and/or off-shore.

 

A Thai company limited would have minimum 3 shareholders, and minimum 51% of the shares are owned by Thais. Older company limited's used as shell for holding of property for a foreigner often used Thai nominees as shareholders, but to my common knowledge these shares still represent a value. You cannot legally take the money from a property sale out of the company – you might however keep only the land office appraised value in the company books, but it depends of documentation needed at the land office, as registration and taxation should be either appraised value, or actual sales price, whichever is highest – nor can you sell the stocks without paying the shareholders. If nominee shareholders have been used, then there should be undated both power of attorney for voting rights, and blank share transfer documents, somewhere."

 

Obviously, he is in agreement that the minority shareholders need to be paid. But he also notes the part in bold above which I assume means that these shares could be transferred to any other Thai before the property is sold. Perhaps there are other mechanisms used as well such as having a loan to the foreign director.

[Yellowtail]

When does any corporation share the proceeds of an asset it disposes of? Never.

 

They MAY choose to issue dividends, and the amount of the dividend MAY be affected by the disposal of the asset, but they are not required to issue dividends, or to adjust the dividends to reflect the disposal of the asset. 

 

If a corporation has significant value and it is liquidated, the share holders have a right to their share of the proceeds. 

 

If the assets are sold off during the course of regular business the corporation has no significant value, although the corporation is still viable, and could be maintained indefinably, or it could be sold or liquidated. In the event the corporation is sold or liquidated, the shareholders would absolutely be entitled to their share of the proceeds, but as the company has/had no real value, what they are entitled to is little or nothing. 

 

Shareholders are NOT partners in the business. 

 

[Thomas J]

6 hours ago, Yellowtail said:

Shareholders are NOT partners in the business

There is an old adage about you can keep quiet and people may think you know nothing, or you can open it and confirm it.

You have obviously done the latter.  Your responses show you do not know the difference between a dissolvement based on bankruptcy versus one based on liquidation of an ongoing concern.

You seem to be of the opinion that shareholders are just names on a piece of paper and that minority shareholders have no rights.  You say if the assets are impacted by their disposal shows your lack of any accounting knowledge.  If an asset is sold, it is taken off the asset list, but the cash received replaces it.  The impact is neutral.  According to my source, dividends are "required" to be paid each year to the minority shareholders although a nominal amount.  You say they are not "partners"  no they are "shareholders"  and their ownership rights dictated by the class of shares they own. 

The very fact you would think the Thai government would go through the process of establishing a law to protect minority shareholders rights and then believe that somehow a company owning a home here in Thailand would be required to have Thai shareholders but any rights to them could be stripped or ignored by the foreign owner is testimony to why you have all the business acumen to run a shoe shine and landscaping business.

I went to the step of inquiring with a property management company who deals with the sale of homes to foreigners.  The Thai company foreign owner is limited to a 49% ownership of the company.  They recommended a minimum of 3 Thai’s as additional shareholders.  Included is a copy of the conversation as to the operating and legal requirements.

As I suspected, the Thai lawyers have determined a way to maintain all of the value of the company with the foreign owner.  If only ordinary shares were issued, ALL SHAREHOLDERS would be required to get their proportionate share of the assets in the company upon dissolution.

However, Thai law permits the Thai owners to get “preference” shares and the foreign owner ordinary shares.  The ordinary shares have superior voting, and ownership of the assets of the company with the Thai preference owners have rights to dividends which must be paid to them annually.

Bottom line, all shareholders of the same class of shares are treated identically and have the same rights.  But Thai law allows foreigners to own companies being formed with Thai shareholders with shares with diminished rights.  I knew that the answer of well just vote to sell the property and to heck with the Thai shareholders was not correct.  That is not to say that some might just do that.  If done correctly and legally, the foreign owner can control the company, and wanting to sell the home, can either sign over the Chanote to the new Thai owner or as I suggested sell their shares in the company to the new foreign owner which saves them the expense of forming a new company.


Selected comments from company that sells property to foreigners and establishes thai based companies.  

 

[Yellowtail]

2 minutes ago, Thomas J said:

There is an old adage about you can keep quiet and people may think you know nothing, or you can open it and confirm it.

You have obviously done the latter.  Your responses show you do not know the difference between a dissolvement based on bankruptcy versus one based on liquidation of an ongoing concern.

You seem to be of the opinion that shareholders are just names on a piece of paper and that minority shareholders have no rights.  You say if the assets are impacted by their disposal shows your lack of any accounting knowledge.  If an asset is sold, it is taken off the asset list, but the cash received replaces it.  The impact is neutral.  According to my source, dividends are "required" to be paid each year to the minority shareholders although a nominal amount.  You say they are not "partners"  no they are "shareholders"  and their ownership rights dictated by the class of shares they own. 

The very fact you would think the Thai government would go through the process of establishing a law to protect minority shareholders rights and then believe that somehow a company owning a home here in Thailand would be required to have Thai shareholders but any rights to them could be stripped or ignored by the foreign owner is testimony to why you have all the business acumen to run a shoe shine and landscaping business.

I went to the step of inquiring with a property management company who deals with the sale of homes to foreigners.  The Thai company foreign owner is limited to a 49% ownership of the company.  They recommended a minimum of 3 Thai’s as additional shareholders.  Included is a copy of the conversation as to the operating and legal requirements.

As I suspected, the Thai lawyers have determined a way to maintain all of the value of the company with the foreign owner.  If only ordinary shares were issued, ALL SHAREHOLDERS would be required to get their proportionate share of the assets in the company upon dissolution.

However, Thai law permits the Thai owners to get “preference” shares and the foreign owner ordinary shares.  The ordinary shares have superior voting, and ownership of the assets of the company with the Thai preference owners have rights to dividends which must be paid to them annually.

Bottom line, all shareholders of the same class of shares are treated identically and have the same rights.  But Thai law allows foreigners to own companies being formed with Thai shareholders with shares with diminished rights.  I knew that the answer of well just vote to sell the property and to heck with the Thai shareholders was not correct.  That is not to say that some might just do that.  If done correctly and legally, the foreign owner can control the company, and wanting to sell the home, can either sign over the Chanote to the new Thai owner or as I suggested sell their shares in the company to the new foreign owner which saves them the expense of forming a new company.


Selected comments from company that sells property to foreigners and establishes thai based companies.  

 

Shouldn't you be out looking for second year law students to get rich with?

 

I understand how complex this must seem to you, but if a corporation has no real value at the time of liquidation, what do the shareholder have coming to them?

 

 

[Thomas J]

2 minutes ago, Yellowtail said:

I understand how complex this must seem to you, but if a corporation has no real value at the time of liquidation, what do the shareholder have coming to them?

I could explain it to you but I think I would need some crayons for a person with your IQ.  

If the home is in the company it has value.  If you sell the home while the business is ongoing the proceeds go into the corporate bank account.  That has value.  It is only when you "liquidate" a company that all assets are distributed.  

The only reason the Thai owners get nothing, is because their share class entitles them to dividends only but that share class is entitled to dividends which the foreign owner is not.  Is it a way to circumvent the intent of no foreign ownership yes.  But your assertion that the company has zero value shows how absent you are of any corporate structure or accounting.  I suggest you stick to shining shoes and cutting lawns.  You appear to be well suited for it. 

[Yellowtail]

20 minutes ago, Thomas J said:

I could explain it to you but I think I would need some crayons for a person with your IQ. 

You would have to understand it to explain it. Again, if a corporation has no real value at the time of liquidation, what do the shareholder have coming to them?

 

 

 

[Thomas J]

1 minute ago, Yellowtail said:

You would have to understand it to explain it. Again, if a corporation has no real value at the time of liquidation, what do the shareholder have coming to them?

Ok this should be simple enough for even someone with the expertise of a shoe shine man to understand but I have my doubts. 

I have a Thai company.  I place 5 million baht into the company to capitalize it.  So on the books it shows a bank balance of 5 million baht.  I use those proceeds to have "the company" buy a home for rental and some personal use by me.  Now 3 years go by and I find I want to sell the home and dissolve the company.   I now sell the home, the proceeds are cash,  that asset belongs to the company so the money legally has to be placed in the corporate account.  Now I vote to dissolve the company and liquidate its assets.  I write myself a check from the company for the amount of money in the company account, and file the papers to have the company cease operations as a going concern. 

Now I realize I am only a person with a 30 year career as an executive officer at major banks including Bank of America, have my MBA in Finance, and have owned 4 companies personally including 1 C corporation, 2 LLC's and 1 sub chapter S company and that pails in comparison to the knowledge you have via owning a shoeshine and lawn moving business. But you even asking this question is pretty evident you are absolutely clueless as to corporate structure, accounting, or share classes. 

[Yellowtail]

9 minutes ago, Thomas J said:

Ok this should be simple enough for even someone with the expertise of a shoe shine man to understand but I have my doubts. 

I have a Thai company.  I place 5 million baht into the company to capitalize it.  So on the books it shows a bank balance of 5 million baht.  I use those proceeds to have "the company" buy a home for rental and some personal use by me.  Now 3 years go by and I find I want to sell the home and dissolve the company.   I now sell the home, the proceeds are cash,  that asset belongs to the company so the money legally has to be placed in the corporate account.  Now I vote to dissolve the company and liquidate its assets.  I write myself a check from the company for the amount of money in the company account, and file the papers to have the company cease operations as a going concern. 

Now I realize I am only a person with a 30 year career as an executive officer at major banks including Bank of America, have my MBA in Finance, and have owned 4 companies personally including 1 C corporation, 2 LLC's and 1 sub chapter S company and that pails in comparison to the knowledge you have via owning a shoeshine and lawn moving business. But you even asking this question is pretty evident you are absolutely clueless as to corporate structure, accounting, or share classes. 

What is it with you and this insults? Does it somehow make you feel better about yourself insulting others? 

 

You have an "advanced degree in finance"  yet you are still unwilling or unable to answer a simple question.

 

Again, if a corporation has no real value at the time of liquidation, what do the shareholder have coming to them?

 

 

 

[Yellowtail]

17 minutes ago, Thomas J said:

I have a Thai company.  I place 5 million baht into the company to capitalize it.  So on the books it shows a bank balance of 5 million baht.  I use those proceeds to have "the company" buy a home for rental and some personal use by me.  Now 3 years go by and I find I want to sell the home and dissolve the company.   I now sell the home, the proceeds are cash,  that asset belongs to the company so the money legally has to be placed in the corporate account. 

Yes, this is exactly right.

 

17 minutes ago, Thomas J said:

Now I vote to dissolve the company and liquidate its assets.  I write myself a check from the company for the amount of money in the company account, and file the papers to have the company cease operations as a going concern. 

No this is exactly wrong.

 

17 minutes ago, Thomas J said:

Now I realize I am only a person with a 30 year career as an executive officer at major banks including Bank of America, have my MBA in Finance, and have owned 4 companies personally including 1 C corporation, 2 LLC's and 1 sub chapter S company and that pails in comparison to the knowledge you have via owning a shoeshine and lawn moving business. But you even asking this question is pretty evident you are absolutely clueless as to corporate structure, accounting, or share classes. 

Do you really believe insulting people and bragging about yourself and how smart you are strengthens your position?   

[Thomas J]

2 hours ago, Yellowtail said:

Do you really believe insulting people and bragging about yourself and how smart you are strengthens your position?  

I was correct.  No matter how simple I tried to make it,  I knew you just would not comprehend it. 

[Yellowtail]

1 minute ago, Thomas J said:

I was correct.  No matter how simple I tried to make it,  I knew you just would not comprehend it. 

And yet with all those degrees, experience and brilliance, you still cannot answer as simple question. Again, if a corporation has no real value at the time of liquidation, what do the shareholder have coming to them?

 

For whatever reason, you seem to think that when a single asset is sold, the corporation has to be liquidated.

 

It does not. 

 

It continues operating without the sold asset. 

 

The funds from the sale of the asset (that we all know have to be deposited into the corporate account) are distributed as directed by the board. This could take days, months or years.

 

Once the corporation is no longer useful and has no significant value it is dissolved or sold. 

 

 

[Thomas J]

23 minutes ago, Yellowtail said:

For whatever reason, you seem to think that when a single asset is sold, the corporation has to be liquidated.

1. Did you even read the original post.  It say and I repeat "When a  company is dissolved"  It does not say "it has to be dissolved" 

2. Now the purpose of these companies is to provide a foreigner with a methodology for purchasing a home that they can not do directly.  

3. Now if the "sole" asset in the company is the home, and the home is theoretically an investment or is being rented and that sole asset is sold.  The company no longer has any "legitimate business purpose"  

4. Now the foreign owner could purchase a different home, or condo, or commercial building and continue to operate the business.  However, in the overwhelming number of instances the foreign owner has no real interest in operating any business, he/she was just using the corporate ownership to obtain the single family home to live in and perhaps rent when they are not using it.  Once disposed of the foreigner has no interest or intention of maintaining the company and would dissolve it. 


The original post asked how that could be accomplished without having to share the proceeds.  I now know how.  If sold only the stock is sold and the new foreigner takes the position of the old one and the company continues.  Or, the home is sold to a Thai.  The minority shareholders hold only a share class that does not entitle them to any return of invested capital.  In the USA I have seen many times different share classes to skew the control of companies.  Typically a small privately held company going public keeps A shares with lets say 100 votes for every share but sells B shares to the public with only 1 vote for every share.  The family selling the shares keeps operating control 

In Thailand the Thai shareholders get only preference "preferred shares"  That is the mechanism used that when the capital in a corporation is distributed allows the foreigner to recoup their invested capital without having to share it. 

It is under Thai business laws not mandatory that equal rights and privileges are attached to all shares of a limited company. Some may be preferential either as to capital or as to dividend, or as to both, or may have privileges in the matter of voting. A Thai limited company structure with preference shares is a popular form of business entity among foreign investors in Thailand. The majority Thai owned company is under the current Foreign Business Act (section 4 (number of shareholding) and section 36 (nominee shareholder punishment)) considered Thai and the foreign investor as a minority shareholder is able to control the company through a preference share structure and circumvent foreign ownership or foreign business restrictions through the Thai limited company. However there is a discussion in the Thai government and Ministry of Commerce to amend the Foreign Business Act and include foreign voting rights and foreign management as a criterion in defining a company foreign or Thai. Such changes could affect existing companies.


 

[Yellowtail]

1 hour ago, Thomas J said:

 

 

1 hour ago, Thomas J said:

1. Did you even read the original post.  It say and I repeat "When a  company is dissolved"  It does not say "it has to be dissolved" 

2. Now the purpose of these companies is to provide a foreigner with a methodology for purchasing a home that they can not do directly.  

3. Now if the "sole" asset in the company is the home, and the home is theoretically an investment or is being rented and that sole asset is sold.  The company no longer has any "legitimate business purpose"  

4. Now the foreign owner could purchase a different home, or condo, or commercial building and continue to operate the business.  However, in the overwhelming number of instances the foreign owner has no real interest in operating any business, he/she was just using the corporate ownership to obtain the single family home to live in and perhaps rent when they are not using it.  Once disposed of the foreigner has no interest or intention of maintaining the company and would dissolve it. 


The original post asked how that could be accomplished without having to share the proceeds.  I now know how.  If sold only the stock is sold and the new foreigner takes the position of the old one and the company continues.  Or, the home is sold to a Thai.  The minority shareholders hold only a share class that does not entitle them to any return of invested capital.  In the USA I have seen many times different share classes to skew the control of companies.  Typically a small privately held company going public keeps A shares with lets say 100 votes for every share but sells B shares to the public with only 1 vote for every share.  The family selling the shares keeps operating control 

In Thailand the Thai shareholders get only preference "preferred shares"  That is the mechanism used that when the capital in a corporation is distributed allows the foreigner to recoup their invested capital without having to share it. 

It is under Thai business laws not mandatory that equal rights and privileges are attached to all shares of a limited company. Some may be preferential either as to capital or as to dividend, or as to both, or may have privileges in the matter of voting. A Thai limited company structure with preference shares is a popular form of business entity among foreign investors in Thailand. The majority Thai owned company is under the current Foreign Business Act (section 4 (number of shareholding) and section 36 (nominee shareholder punishment)) considered Thai and the foreign investor as a minority shareholder is able to control the company through a preference share structure and circumvent foreign ownership or foreign business restrictions through the Thai limited company. However there is a discussion in the Thai government and Ministry of Commerce to amend the Foreign Business Act and include foreign voting rights and foreign management as a criterion in defining a company foreign or Thai. Such changes could affect existing companies.


 

And still, you are unwilling or unable to answer a simple question. If a corporation has no real value at the time of liquidation, what do the shareholder have coming to them?

 

The company does not have to have any assets to be viable. 

 

[Thomas J]

12 hours ago, Yellowtail said:

And still, you are unwilling or unable to answer a simple question. If a corporation has no real value at the time of liquidation, what do the shareholder have coming to them?

 

The company does not have to have any assets to be viable. 

Ok I thought this would be a challenge given your previous nonsensical posts. 

You tell me, how if I form a company to purchase a home, and the home is an asset of the company how in earth could the company have "no value"  Hint:  company book value is the balance sheet.  The balance sheet would show the home as "an asset"  Now the value of the home may have gone down.  But it would not be as you somehow think would have "no real value"  What you describe is Impossible. 

Second, the foreign stockholder places money into the corporate account and uses it to purchase a home.  The home is an asset.  If the home is sold, the money flow reverses and the home is taken off the balance sheet and is replaced by the cash going into the corporate bank account.  With these Thai companies it would be impossible for it to have zero or negative book value. 

Third,  Every business must "if legal" have a legitimate business purpose. 

If the company has no assets, and is not engaged in any activity that could be construed as a legitimate business purpose it would no longer be legally eligible to remain a business entity in Thailand and if done "legally" would have to be dissolved. 

 

[Yellowtail]

4 hours ago, Thomas J said:

Ok I thought this would be a challenge given your previous nonsensical posts. 

You tell me, how if I form a company to purchase a home, and the home is an asset of the company how in earth could the company have "no value"  Hint:  company book value is the balance sheet.  The balance sheet would show the home as "an asset"  Now the value of the home may have gone down.  But it would not be as you somehow think would have "no real value"  What you describe is Impossible. 

Second, the foreign stockholder places money into the corporate account and uses it to purchase a home.  The home is an asset.  If the home is sold, the money flow reverses and the home is taken off the balance sheet and is replaced by the cash going into the corporate bank account.  With these Thai companies it would be impossible for it to have zero or negative book value. 

Third,  Every business must "if legal" have a legitimate business purpose. 

If the company has no assets, and is not engaged in any activity that could be construed as a legitimate business purpose it would no longer be legally eligible to remain a business entity in Thailand and if done "legally" would have to be dissolved. 

 

You have to answer my question first. Again, if a corporation has no real value at the time of liquidation, what do the shareholder have coming to them?

 

This should be an easy question for you. 

[Thomas J]

1 hour ago, Yellowtail said:

You have to answer my question first. Again, if a corporation has no real value at the time of liquidation, what do the shareholder have coming to them?

 

This should be an easy question for you

If a company has zero value or even negative value shareholders all of them get nothing.  However this is a bogus question.  My OP stated specifically that it dealt with the dissolvement of a Thai company and the sale of the home.  It is impossible, I repeat impossible for that company to have no value.  It is incredulous that you could even run a shoe shine business with no understanding of a balance sheet.  The home is an asset, if sold, it is replaced by the cash.  The value of the company only goes to zero after all of the assets are distributed.  These companies are not engaged in a business activity that generates losses.   The business entity is just a shell that is allowed to have the Chanote put in its name.  

Now with that, tell me exactly how when you open a company here in Thailand with the specific purpose of purchasing a home, and you put in 5 million baht and the company buys a home for 5 million baht, that whether 1 year or 10 years or 100 years that home and its land have No Value.  

[Yellowtail]

1 minute ago, Thomas J said:

If a company has zero value or even negative value shareholders all of them get nothing. 

Thank you

 

1 minute ago, Thomas J said:

However this is a bogus question.  My OP stated specifically that it dealt with the dissolvement of a Thai company and the sale of the home.  It is impossible, I repeat impossible for that company to have no value.

Yes, it you liquidate the corporation while it still owns the house, or it has sold the house but still has the money on the book it has value

 

1 minute ago, Thomas J said:

It is incredulous that you could even run a shoe shine business with no understanding of a balance sheet.

What kind of businesses did you have? Is it incredulous that you are insisting that when a corporation sells an asset it must liquidate and distribute the funds to the shareholders?

 

1 minute ago, Thomas J said:

The home is an asset, if sold, it is replaced by the cash.

Correct

 

1 minute ago, Thomas J said:

The value of the company only goes to zero after all of the assets are distributed.gg 

Correct, although it would be foolish to distribute everything down to zero.

 

1 minute ago, Thomas J said:

These companies are not engaged in a business activity that generates losses.   The business entity is just a shell that is allowed to have the Chanote put in its name.

The business does more than just own the house. 

 

1 minute ago, Thomas J said:

Now with that, tell me exactly how when you open a company here in Thailand with the specific purpose of purchasing a home, and you put in 5 million baht and the company buys a home for 5 million baht, that whether 1 year or 10 years or 100 years that home and its land have No Value.  

 

The home and land will never not have value. I never said that at some point the home and land would have no value.

 

A business can buy a house, but a house is not a business.

 

To be clear, the time to liquidate the corporation is AFTER the house has been sold and the funds have been distributed, not before, or during. 

 

Once the asset has been disposed of AND the funds distributed, the corporation has little value and can be liquidated, sold or maintained indefinitely.