Legal Environment of Business and Online Commerce in Thailand - Essay Example

Introduction The Kingdom of Thailand or Ratcha Anachak Thai is ified as an independent country, lies in the heart of Southeast Asia, and bordered by Laos, Myanmar, Cambodia, the Gulf of Thailand, Malaysia, and Andaman Sea. It’s the fiftieth largest country, smaller than Yemen and larger than Spain. Bangkok, the center of political, commercial, industrial, and cultural activities, is the capital and largest city in Thailand. Thailand has sixty-four million residents. The ethnic population is around 75%. The Chinese origin is 14%, with 3% ethnically Malay. The remaining percent is the following minority population: Mons, Khmers, and various hill tribes. Legal and illegal migrants are around 2.2 million people. It attracts a small percentage of expatriates or emigrants from Western developed countries. Thailand is a devout, Buddhist country. The national religion is Theravada Buddhism, practiced by over 94.7% of the people in Thai. Muslims consist of 4.6% of the population. The final 0.7% of religious practices belongs to other religions. India influences the culture and traditions in Thailand, Burma, Laos, and Cambodia. Thailand’s international disputes have forced border closures because of the separatist violence in predominately Muslim, southern provinces. The disputes are strengthened with control over Malaysia to stem terrorist activities. Types of government Constitutional Monarchy Thailand is a Constitutional Monarchy with a Monarch acting as the head of state. The government style is written or codified, unwritten or un-codified, and a blended constitution. Thailand’s Constitutional Monarchy Government is dissimilar from an Absolute Monarchy, the sole source of political power in the state. It is not legally bound by another constitution. Executive Branch The Chief of State is King Phumiphon Adunyadet, reigning since June 9, 1946. His advisor is the Privy Council. The Prime Minister is Abhisit Wetchachiwa, reigning since December 17, 2008. The Deputy Prime Ministers are Korbsak Saphawasu, Sanan Kachornprasat, and Suthep Thueaksuban. They have been the deputy prime ministers since December 22, 2008 (Saphawasu), February 7, 2008 (Kachornparsart), and December 22, 2008 (Thueaksuban). The elections of the monarch are hereditary. The selection of the prime minister is from the members of the House of Representatives. The king appoints the prime minister based on the leader of the party who organized the majority coalition. The term limit is for two four-year terms. Legislative Branch The Bi-Cameral National Assembly, known as Rathasapha, consists of the Senate or Wuthisapha with 150 seats. The popular vote represents 76 provinces and elects 76 members. Seventy-four members are appointed by the judges and independent government bodies. Each member serves six-year terms. The House of Representatives, known as Sapha Phuthaen Ratsadon, seats 480 members, which consists of 400 members who are elected from 157 constituencies. The remaining 80 members are elected on a proportional party-list basis. There are ten members per eight zones or groupings of provinces. House of Representative members serve a four-year term. The last election in the Senate was held on March 2, 2008. The next election for the Senate will begin in March of 2014. The last election for the House of Representatives was held on December 23, 2007. The next election for the House of Representatives will be held in December of 2011. On February 19, 2008, seventy-four senators were appointed. The appointment was headed by the chief of the Constitutional Court. On March 2, 2008, seventy-six senators were elected. The Senate elections are non-partisan. Political party members who are registered are disqualified from being senators. Judicial Branch The Judicial Branch of Thailand is one segment of the government system. It consists of the Supreme Court, which is known as the Sandika. The judges who hold a seat in the Supreme Court are appointed by the Monarch. Type of Legal System The legal system is a civil law with influences from the common law. The principle legal sources are the Constitution of Thailand, the Acts and Statutes, the Royal Proclamation, Treaties, Subordinate Legislation, and the Supreme Court Opinions and other judicial decisions. The Constitution of Thailand prevails against other laws. The Acts and Statutes were created to amend four basic codes: Civil and Commercial Code, Penal Code, Civil Procedure Code, and Criminal Procedure Code. The Land Code and the Revenue Code are new. The expiration of statutes is calculated from the Buddhist Era (BE) and based on the Thai solar calendar. The Royal Proclamation or the Emergency Decree is set by the King and advised by the Cabinet. It is designed for national security, public safety, national economic stability, or avert public calamity. The Subordinate Legislation involves the Regulations or Ministerial, Orders, Notifications, and Royal Decrees and Rules. The Supreme Court Opinions and other judicial decisions rule that judicial precedent decisions are not binding. The lower court systems in Thailand are not bound to follow precedents set by the higher courts. The Common Law aspect of Thailand’s legal system has influences from earlier legal rulings, such as rulings from higher courts. The Supreme Court Opinions are published by the Supreme Court Justice. These opinions are regularly implemented in case decisions as a secondary authority. The opinions are numbered based on the year that the opinion was issued. The Administrative Court and the Constitutional Court publishes other judicial decisions. Type of Court System The court system or system of justice is designed on the guidelines of civil law. Written legislation is the basis for all administration of justice, conforming to this law. It is divided into three levels: The Courts of First Instance, The Courts of Appeal, and The Supreme Court. The Courts of the First Instance is a court system that is throughout the country. Within the provinces, The Courts of First Instance are divided into Provincial Juvenile and District Courts. In the Bangkok region, The Courts of First Instance are divided into Civil, Criminal, Central Juvenile, Central Labor, Central Tax and District Courts. The Courts of First Instance has approximately 135 courts. The Courts of Appeals are divided into three regional courts throughout the country, establishing one central court in Bangkok. The Supreme Court, known as Sandika, is the highest court in Thailand. The rulings in the Supreme Court are final. Criminal rulings can be appealed. The defendant has the option of appealing a criminal case for clemency from the King. The King designates membership in the Supreme Court. The Courts of Justice is divided into two categories: Administration and Adjudication. The Ministry of Justice was previously responsible for the administration work of all of the court before August 20, 2000. The Ministry of Justice’s primary role was to provide courts’ support to enable the courts to operate efficiently. Such support included budgeting, personnel, and office equipment. At the present moment, the sole organization that is responsible for the administration of the Courts of Justice is the Office of the Judiciary. It is an independent organization and a juristic person. The reason for this change is to guarantee that the court system has independence from political interference. In adjudication, the Courts of Justice have the power to review and adjudicate criminal, civil, bankruptcy, and all other various cases that are out of the scope of the jurisdiction of other courts. The commission on Jurisdiction, chaired by the President of the Supreme Court, handles cases that needed determination of whether the particular case is within the jurisdiction of specific types of courts. The court is authorized to grant a final decision. The Courts of First Instance The Courts of First Instance are defined as general courts, such as juvenile, family courts, and specialized courts. The general courts are regular courts with the authority to hear and adjudicate criminal and civil cases. The courts in this category are Civil Courts, Criminal Courts, Provincial Courts, and Kwaeng Courts. General Courts Two judges form a quorum in general courts. The only exception to this rule is the Kwaeng Courts. The Court of Appeals hears an appeal against a judgment on two questions of law. The appeal is subject to some conditions, questions of fact, or an order of the general courts. The Provincial Courts and Kwaeng Courts are two types of general courts. These courts are managed by the Court of Justice Region’s Chief Judge. If the Chief Judge is absent, the Supreme Court Judge appoints a judge to fulfill the required duties of the Chief Judge. The Chief Judge can hear and adjudicate cases in any court in the region, as well as assign a judge to a court in the Chief Judge’s region. In Bangkok Metropolis Under the Civil Courts, the plaintiff is required to file a complaint in the jurisdiction where the dispute arises or where the defendant resides. If the plaintiff is disputing a property, the plaintiff is required to file a complaint in the court where the property is located or where the defendant resides. In Bangkok, the four courts that deal with civil cases in the Courts of First Instance are the Civil Court, the Civil Court of Southern Bangkok, the Thon Buri Civil Court, and the Mini Buri Provincial Court. The cases in these courts depend on the district of the offense or the defendant’s residency. Previously, adjudicating civil cases before 1977 in Bangkok were held in the Civil Court. However, due to the high volume of cases in the Civil Court, the establishment of Civil Court in Bangkok was necessary. Criminal cases are held in the court of the district where the defendant is arrested or resides. There are instances where an inquiry official requests jurisdiction over the case. The Courts of First Instance in Bangkok handles criminal cases in the following courts: Criminal Court, Criminal Court of Southern Bangkok, Thon Buri Criminal Court, and Mini Buri Provincial Court, due to the high volume. Criminal Courts can make the decision to hear and adjudicate criminal cases out of the scope of its territorial jurisdiction or transfer the case to a court within the scope of the cases territorial jurisdiction. The Mini Buri Provincial Court is the only provincial court located in Bangkok Metropolis. This court handles cases involving criminal offenses and civil cases. The framework of this court is similar to the general provincial courts. The Municipal Courts handles small cases based on the expense and formality of the case. The courts handle criminal and civil cases. The criminal cases held in Municipal Courts must have a punishable offense of three years maximum imprisonment. The fine must not exceed 60,000 Baht or both. Civil cases handled in the Municipal Courts must have a maximum claim of 300,000 Baht. The cases in the Municipal Court are quick, and the decision is reached in an oral or summarized judgment. In other Provinces The Provincial Courts have total, original jurisdiction in all civil and criminal cases in the courts’ district. Due to the area of the district, there may be more than one Provincial Court. A Chief Judge is assigned to the Provincial Courts. The Director of the Office of the Provincial Court handles the administrative duties of the court. The Juvenile and Family Courts The framework of the Juvenile and Family Courts has a Central Juvenile and Family Court. It also consists of the Provincial Juvenile and Family Courts and the Division of Juvenile and Family Court in the Provincial Courts. The characteristics of the courts consist of two career judges and two associate judges, and it has to consist of one woman. This framework designs the quorum of the Juvenile and Family Courts. The Courts of Appeal handles any appeal against the ruling in a particular case. Specialized Courts The Specialized Courts consists of four courts, which are the Labour Court, the Tax Court, and the Intellectual Property and International Trade Court, and the Bankruptcy Court. The purpose of these courts is to resolve any specific or technical problems. This responsibility is given to the assigned judge. The appointment of a judge in the Specialized Courts is based on the judge’s experience in the details of the case. The Labour Court and the Intellectual Property and International Trade Court have career judges and associate judges working together in adjudicating cases. Each listed court, except the Labor Court, has one central court. The Courts of Appeal The Courts of Appeal is made up of the Courts of Appeal and nine Regional Courts of Appeal, which handles appeals in cases from Civil and Criminal Courts. Appeal cases from The Courts of First Instance are handled in the Regional Courts of Appeal. Jurisdiction in the Regional Courts of Appeal is equivalent to the jurisdiction in The Courts of First Instance. This court has a president, assisted by the vice-president, who handles the cases. The court is sectioned into divisions consisting of one chief justice and two other justices, forming a quorum with at least three justices. The Research Division judges of the Courts of Appeal handle the facts of the case. The Supreme Court The Supreme Court is the highest court in Thailand, and it is the court that reaches the final decision on cases that are appealed. It handles both civil and criminal cases. The court members are the president, vice-president, secretary, and justices. It is separated into three divisions with three justices in each division. It has a research division with research justices. The president of the Supreme Court is over the Court of Justice, handling judicial and administrative duties. The trial procedure rule based on the constitution states that the members of the House of Representatives and Senator cannot claim immunity. The National Counter Corruption Commission is responsible for providing the Criminal Division for Holders of Political Positions records in the event of an investigation of additional facts in the case. Trial Procedure The trial procedures require the following: List of Evidence, Form of Evidence for Submission, Witnesses, Emergency Orders/Temporary Injunctions, Presentation of Final Arguments, Burden of Proof, and Judgments. All of this information is required in the trial proceedings. Alternative Dispute Resolution An Alternative Dispute Resolution is a way for courts to settle cases out of court in conciliation or arbitration. The guidelines for an Alternative Dispute Resolution is a case where the judge believes that there is a chance for settlement, an expert can resolve any technical issues in the case, the judge believes it is inappropriate to be present, a room is designated for the case where the judge and lawyers are not present in their gowns, and an instance where there is a speedy settlement. A criminal case in conciliation focuses on healing the victim mentally, emotionally, and financially, and conciliation attempts to make the defendant aware of his or her actions. A civil case in conciliation or mediation attempts to resolve the monetary dispute by finding and requiring the responsible party to pay for the damages in the case. The Arbitration Law in Thailand is similar to the United Nation’s Model Law on International Commercial Arbitration. In civil arbitration cases, the parties involved are required to pay costs and expenses from the institution and arbitrators’ fee. The arbitrator grants a decision for one party over the other party. Criminal arbitration cases require an expert witness to investigate the facts of the criminal case, reaching a decision based on the facts of the evidence presented. Thailand’s “Lese Majeste” law Thailand’s “Lese Majeste or a crime of violating majesty” law is defined as the Reverence for the King. If someone insults the king, the offense is punishable up to fifteen years in prison. In Thailand, the King is enthroned in a position of revered worship. He shall not be violated. No one shall expose the King to any type of accusation or action. Business law “climate” Types of business organizations in Thailand An Ordinary Partnership requires a minimum of two people. They are joint partners who share unlimited liability. It is not required to register an Ordinary Partnership. A Limited Partnership requires two types of partnerships. The first partnership is designed under a limited liability, and the second partnership is designed under a joint, unlimited liability. A limited company, such as a private limited company, is the most popular business setup in Thailand. The investor and managerial framework is separated. It requires a minimum of three promoters who must file the following: a memorandum of association, convene a statutory meeting, register the private limited company, and obtain a company income tax identity card. A private limited company can be converted into a public limited company. In a public limited company, the shareholder’s liabilities are limited based on the share amount, and the shares can be offered up for sale to the public. The investor and managerial framework is separated. Registering a public limited company is similar to a private limited company. A joint venture is considered as a contract matter. A joint venture setup involves the responsibilities handled by two or more natural or legal entities to create a profit. It is clearly defined under the Thailand’s Tax Code. The joint venture companies remain as separate entities. Government regulations regarding foreigners doing business in Thailand The Alien Business Law or the National Executive Announcement restricts aliens or non-Thais in business activity. The law defines an “Alien” or “Alien Business” as lacking Thai Nationality. The categories that are restricted includes foreigners, except for accounting, law, or architecture, fishing, printing, tour agencies, and other businesses and requires an Alien Business License, including retail, wholesale, and other businesses. Americans are granted a total of 30 days without a visa. A business visit that is longer than 30 days requires a non-immigrant “B” visa, valid for 90 days for a single entry and 180 days for multiple entries. The visa is required before entry into Thailand. The application for the visa requires two passport-size photos. It also requires a letter from a sponsoring company with the length and purpose of the visit. A work permit is ruled under the Alien Occupation Law, requiring people who are not Thai to obtain a work permit before working in Thailand. An application is filed with the Ministry of Labor. The non-immigrant visa is obtained at the Thai Embassy prior to filing the work permit. However, there are thirty-nine restricted occupations. Reference Business-in-Asia.com. Alternative Dispute Resolution Office: Providing investors with internationally accepted arbitration and mediation options. Retrieved from http://www.business-in-asia.com/thai_court.htm Integrity Legal: The Law Is Our Business. Company Registration, Formation, Structure, Setup and Incorporation in Thailand. Thailand Public Limited Company. Retrieved from http://www.www.integrity-legal.com/company-thailand/thai-company-overview.html Limparangsri/Sorawit. Alternative Dispute Resolution in Asean: A Contemporary Thai Perspective. Retrieved from http://www.aseanlawassociation.org/9GAdocs/w4_Thailand.pdf Thailand Lawyers Attorneys & Legal Services: Law and Legal Services and Mission in Thailand. Court-Annexed ADR in Thailand: A New Challenge. Retrieved from http://asialaw.tripod.com/articles/adr.htm Thai Law Online (2009). Procedures during Trial. Retrieved from http://www.thailawonline.com/en/others/courts-in-thailand.html World Map Maker. International Relations with Thailand. Retrieved from http://www.worldmapmaker.com/countries/thailand/international-relations Read More