The move follows SEC hearing at the end of 2018 on the amendment of the regulations on the maintenance of capital of investment management companies that manage property funds and infrastructure Funds, REIT managers and trustees. Under the proposed amendments, investment management companies are required to maintain three types of capital, namely, (1) the initial capital or the minimum owner’s equity, (2) the additional capital to ensure business continuity, and (3) the additional capital to cover potential liability risks due to professional negligence. Actions in case of failure to meet the capital requirements are also stipulated in the proposed amendments.

SEC is now seeking public comments on the revised draft notification on the maintenance of capital which has been refined in certain areas by considering suggestions from the private sector to make the regulations more appropriate. For example, (1) adding a provision to allow business operators to insure with the insurer that maintain a capital adequacy ratio of no less than 200% and attain no less than three latest consecutive calendar years of net profits, (2)  revising the timeframe for corrective actions by REIT managers who have been engaged in the business before the effective date of the notification to comply with the capital requirements by maintaining the initial capital to no less than 5 million baht within two years and 10 million baht within four years, and (3) requiring REIT managers to report the maintenance of capital to the trustees.

The consultation paper can be found at https://www.sec.or.th/TH/Pages/PB_Detail.aspx?SECID=552. Stakeholders and interested parties are welcome to give comments and suggestions via SEC website: www.sec.or.th/hearing, or facsimile at 0-2263-6231, or email: sittiwat@sec.or.th or nuchanat@sec.or.th or kittinee@sec.or.th. The public hearing ends on 30 September 2019.