Trade disputes are a natural and inevitable part of global commerce. A commitment to fair trade practices and compliance with international agreements are important for maintaining a stable trading environment.
The Philippines claims that Thailand’s customs valuation measures affecting Philippine cigarette exports breach the CVA, various provisions of the GATT and other WTO rules.
Alternative Dispute Resolution
In an effort to avoid a massive burden on the court system, the Thai government encourages alternative dispute resolution (ADR) for commercial disputes. The judicial system is already overburdened and resolving disputes through ADR may be quicker than seeking a final judgment in court.
A disputed matter may be resolved through conciliation, arbitration or mediation. ADR is usually more cost-effective than a court case and the proceedings can be kept confidential. However, it is essential for a business to obtain legal assistance from an experienced civil or commercial litigation attorney in Thailand to ensure that their interests are protected.
In the event that disputing parties are not able to reach a settlement agreement, an arbitral award may be enforced in the country of Thailand as well as abroad under the New York Convention on the Enforcement of Foreign Arbitral Awards 1958. Both parties have the right to choose one or three arbitrators and the arbitral tribunal must be composed of experts in the subject matter of the dispute.
Arbitration
Although disputing parties may opt to resolve their dispute through negotiation or mediation, they also have the option of resorting to arbitration. Arbitration is a form of alternative dispute resolution that is suited to a wide range of civil disputes. It is also an excellent method for resolving trade disputes, as it allows for the confidentiality of all discussions and proceedings.
Moreover, the decision made by an arbitrator is generally binding and cannot be appealed (although a party in a court of law may still seek costs orders more commensurate with actual legal fees). Arbitration is also a quicker means of dispute resolution than a court trial.
During an arbitration hearing, the disputing parties must offer proof of their defenses and claims. They are also allowed to question experts and witnesses. Moreover, a hearing is usually held in a private setting. It is also possible to conduct a confidential arbitration, which is particularly useful for renowned public figures or companies that wish to maintain their reputation and avoid compromising any sensitive information.
Conciliation
While litigation remains the most common means of resolving trade disputes in Thailand, there are other methods that can be used. Conciliation, for example, has been increasingly used by courts of justice around the country with encouraging figures of success. This has been partly due to the fact that it allows parties to tailor how a dispute will be resolved by selecting an arbitration institute and set of rules, the venue and the number of arbitrators.
Conciliation is often much quicker than a trial and can be less expensive. However, it is essential that complainants and respondents are prepared to compromise in order to reach an agreement.
It is also important that both sides understand the implications of their actions. For example, they should be prepared for the possibility that the officer managing their complaint might be unable to reschedule the conciliation conference if they fail to attend on the appointed date and time. This could lead to a significant delay in the resolution of the complaint.
Intellectual Property and International Trade Court
As a means of resolving trade disputes, negotiation and conciliation are well-established, featuring in most standard arbitration clauses. A judge can also facilitate a compromise by convening closed door sessions with parties or appointing a neutral reconciler from outside the court to bring about a settlement.
The IP&IT Court has nationwide jurisdiction to adjudicate cases involving intellectual property and international trade issues. Its establishment demonstrates Thailand’s commitment to fostering innovation and protecting creators’ rights while providing a fair trade environment in the global arena.
This is especially important as Thailand has been losing a number of WTO disputes, most recently in the case concerning its non-compliance with the Agreement on the Customs Valuation Agreement (CVA). In this dispute, which dates back to 2008, a panel and the Appellate Body have ruled that Thailand’s valuation measures for Philippine tuna are inconsistent with the CVA. Despite these losses, the government continues to believe that bilateral discussions would be a “friendlier alternative” to litigation, but negotiations have yet to resume.