In Thailand, ordinary partnerships mean that two or more people agree to unite their capitals to carry on activities together, with the purpose of sharing the net income derived from such activities. All partners are jointly and unlimitedly liable for the obligations of such partnership.
Ordinary partnerships are considered to be a kind of contract, therefore, it is not required by law to registered. It could be incorporated by merely making an agreement between the partners without any formal registration. Nonetheless, ordinary partnerships can be registered if the partners so choose. Once the partnership is registered, it is considered as a juristic person in Thailand law.
Dissolution of this type of partnership shall include management of its property and liabilities. As all partners invest capital and unite assets while establishing a partnership, it is quite possible that some partners advance their money during the process of carrying on activities or use part of the partnership's capital. Thus, such partnership may be a creditor or a debtor in its relations with third parties. When dissolving a partnership, debts shall be settled and assets distributed; profits or losses shall be distributed as well. Apart from this, dissolution of a partnership includes termination of a certain agreements.
Liquidation means that all the assets of the partnership are brought together in order to pay-off debts and repay shares' value to the partners. The rest of money (if any) is considered as income and distributed between the partners. If the assets do not cover all the existing debts or there is not enough money to repay the shares' value, the partners shall take responsibility for losses accordingly.
In most cases with unregistered Ordinary Partnerships the partners carry on a small business and there are only a few partners, as well as just a few assets, if any, and generally, there are no debts to third parties. Thus, there is no need to perform liquidation. Partners usually find ways and agree on to how to liquidate assets and pay off debts.
Though the registration of an Ordinary Partnership is not strictly prescribed by the law, it can still be registered. The registration process is the same as the one prescribed for limited partnerships and limited companies. The provisions of Sections 1014 - 1024 of the Civil and Commercial Code are applicable for registered partnerships. In accordance with Section 1014, the Minister of Commerce, is presently responsible for the registration of partnerships and companies, it issues rules the governing the establishment of these organizations. In Bangkok, registration can be done at the Office of Central Company and Partnership Registration, while in all other provinces there are local registration offices.
In accordance with the provisions of the Civil and Commercial Code, the registration process prescribed for partnerships and companies is as follows: