Trade Disputes in Thailand

Trade Disputes can be complex and lengthy. However, they do not necessarily need to lead to litigation.

Initiated by the Philippines in 2008, this dispute concerns Thailand’s failure to value Philippine cigarette exports consistent with WTO Customs Valuation Agreement rules. The dispute has already gone through three rounds of panel and Appellate Body proceedings.


Many people avoid litigation because they fear that the legal system will disrupt business relationships, lead to increased costs and lengthen the time it takes to get a resolution. While these concerns are valid, a lack of alternatives may ultimately force you to seek recourse through the courts.

In Thailand, the court is required to schedule hearings to allow witnesses to be questioned and evidence to be presented. The time it takes for a case to be resolved can vary depending on the complexity of the issue and the availability of witnesses.

In most cases where the plaintiff is a foreign person, any documents submitted to the court must be in Thai or translated to Thai. A plaintiff must also pay a court filing fee. If a claim is successful, lawyers’ fees and expenses are normally recoverable from the defendant. However, this is not always the case.


Mediation is encouraged by the Thai courts and reflects Thailand’s culture of peaceful and nonadversarial dispute resolution. Courts can order mediation in civil cases deemed appropriate and with the consent of the parties. Mediation is also available at the appellate level in certain courts such as Family, Labour and IP and IT. It helps to settle disputes in a less adversarial manner and reduces the number of appeal cases filed. However, a mediated settlement agreement cannot be admitted as evidence in court and it is not always easy to enforce.

It is recommended to include an arbitration clause in contracts with a foreign party as it offers a more cost-efficient alternative to litigation, especially for international trade disputes where a settlement can often be reached without the need for a lengthy and costly court case. The arbitration process can be tailored to the specific needs of each party by selecting the arbitrator, the arbitration institute and venue as well as the rules governing the proceedings.


A dispute resolution process in which a third party makes a ruling on the matter. It can be less formal and more cost-effective than court litigation.

In Thailand, arbitration is the most commonly used method of dispute resolution for international trade disputes, as well as construction contracts. Most construction contracts will include a structured dispute resolution clause to account for the various kinds of issues that can arise.

Litigation can be time-consuming and costly for the parties, which is why Thai lawmakers have been working on strategies to encourage more parties to pursue alternative dispute resolution (ADR) options instead of a drawn out court process. One of these is conciliation. In a conciliation, the judge will facilitate a compromise between the conflicting parties by conducting closed-door sessions with each of the disputants. The presiding judge can also appoint an outside mediator to assist with the conciliation. Once a compromise is reached, the parties can choose to enter into an enforceable binding compromise agreement or withdraw the case from the courts.


The attorneys at Siam Legal can help clients understand the law and process of litigation in Thailand. This includes preparing documentation, gathering evidence and representing the client in court. Our team of bilingual Thai lawyers can also guide clients through the steps of arbitration and other alternative dispute resolution methods that can offer more flexibility and less cost compared to court litigation.

Thailand continues to believe that bilateral discussions are the friendlier alternative to litigation, particularly since the Philippines has failed twice in the panel and Appellate Body stages of DS371. As such, it remains committed to its commitment to the WTO dispute settlement system, which requires that WTO Members only resort to recourse to the Dispute Settlement Body (DSB) after exhausting all other means of dispute settlement. This is consistent with the principles of multilateralism and mutual respect that are enshrined in the WTO Agreement on Rules of Origin and Customs Tariffs.

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