Closing the Legal Vacuum: A Comparative Analysis of Post-Termination Asset Stewardship for Social Enterprises in Thailand

Abstract

Background: Thailand’s Social Enterprise Promotion Act (SEPA) B.E. 2562 (2019) established a formal registration system for social enterprises (SEs); however, it fails to specify the legal consequences following the termination of SE status. This legislative oversight creates a legal vacuum, exposing public assets and community beneficiaries to significant risk. For example, assets acquired through state grants or social missions could be legally transferred to for-profit entities upon termination, undermining the stewardship of resources dedicated to public benefit.

Objective: This study identifies critical legal gaps in Thailand’s post-termination framework for SEs and develops evidence-based recommendations for reform through a comparative analysis with established international models.

Methodology: The research utilised a qualitative comparative legal analysis of primary statutory documents from Thailand, the United Kingdom (Community Interest Company model), and the Republic of Korea. The study focused on three primary themes: termination procedures, post-termination asset management, and stakeholder protection mechanisms.

Results: The findings reveal that Thailand’s SEPA lacks specific provisions for asset stewardship and stakeholder accountability once an entity's SE status is revoked or voluntarily terminated. Conversely, the UK’s legally enforceable asset lock and dedicated regulator, along with South Korea's mandated distribution of residual assets to social purposes, provide coherent frameworks that preserve the social mission and protect the public interest post-termination.

Conclusion: To ensure transparency and prevent the misappropriation of social value, Thailand’s legislative framework requires explicit post-termination governing clauses. These should be modelled after the protective mechanisms found in comparator jurisdictions to ensure that assets remain dedicated to their intended social purposes.

Unique Contribution: This study represents the first systematic comparative analysis of post-termination legal gaps in Thai SE law. It advances concrete, legally substantive policy recommendations that align institutional stewardship with the preservation of social value, offering a template for hybrid organisational legislation in emerging economies.

Key Recommendation: The Thai legal framework should be amended to establish a statutory asset lock mechanism, precise disclosure requirements for stakeholders, and enhanced monitoring powers for regulatory authorities following the revocation of SE status.