THE International Chamber of Commerce Thailand (ICC Thailand) has expressed its support for a legislative amendment to the Thai Arbitration Act, saying it would encourage foreign investors to put their money in the country and trade more with Thai counterparts.
ICC Thailand chairman Somyod Tangmeelarp told a press conference yesterday that the chamber welcomed the government initiative to improve the arbitration environment and make the process more convenient to ensure Thailand is perceived as an arbitration friendly jurisdiction.
Somyod, who is also vice chairman of the Federation of Thai Industries, said he was encouraged by the Cabinet’s approval on January 23 of an amendment to the Thai Arbitration Act BE 2545. If the legislation is approved by the Council of State and the National Legislative Assembly, it will become law.
Somyod said that the current legal framework for arbitration in Thailand was saddled with two main problems. First, foreign arbitrators are reluctant to act as arbitrators in Thailand due to the onerous work permit requirements they are required of them to perform a temporary service here. Second, parties can appoint foreigners to represent them in arbitral proceedings only in very limited circumstances.
The draft bill appears to remove both of these obstacles by separating domestic and international arbitral proceedings and allowing parties in international arbitral proceedings to chose foreigners to act as arbitrators. The bill also allows these people to stay in Thailand and perform their duties on a temporary basis without the need to obtain a work permit, he said.
Somyod was upbeat on the future of arbitration in Thailand, saying that these measures would make arbitration more convenient for foreign parties and encourage foreign parties to engage in international arbitral proceedings conducted in Thailand, instead of other jurisdictions such as Hong Kong or Singapore.
As part of the wider benefits, the legislative amendment will encourage foreign investors to conduct more international trade and investment with Thailand, he said.
Additionally, foreign arbitrators and representatives will be more willing to provide their services in Thailand. Moreover, the Thai legal community will benefit from more international arbitrations being conducted here. Thailand will also benefit from significant arbitration tourism, an area in which Hong Kong and Singapore have enjoyed advantages, he said.
In Thailand, there are about 1,000 disputes between private companies and investors with government agencies awaiting dispute settlement by arbitral proceedings, according to ICC Thailand.
Arbitral proceedings are typically less time consuming than a normal court procedure, as parties involved usually agree in advance to use arbitrator services.
The International Chamber of Commerce is the world’s largest business organisation working to promote international trade, along with responsible business conduct. ICC Thailand is a national committee of the ICC.