Business entities frequently find themselves at a crossroads when deciding on the ideal dispute resolution clause for their agreement. Should they opt for Thai court litigation or arbitration? What represents the most appropriate dispute resolution clause for their agreement? The following succinct comparison aims to provide clarity and assist in making that crucial decision:
Considerations |
Venue for Proceedings |
|
Thai Court |
Arbitration Institution |
|
Official Costs and Fees |
When the claim amount does not exceed THB 50 million, the court
will impose a fee of 2%, but not exceeding THB 200,000. |
Fees differ by institution and typically include a filing fee,
institution fee, arbitrator fee (per individual), and other
expenses. |
Duration |
Following the enforcement of the Act on Determining Timeframes
for Judicial Proceedings B.E. 2565 (2022), the President of the
Supreme Court issued the Judicial Regulation on the Timeframe for
Court Cases B.E. 2566 (2023), which outlines the following
summarized timelines for court proceedings: |
Arbitration generally aims for expedited proceedings. In some
institutions, cases with smaller claims might be resolved by merely
examining documentary evidence. |
Flexibility of Procedure |
Parties must adhere to Thai legal proceedings, all of which are conducted only in Thai language. |
Parties have the flexibility to determine and agree on various aspects of the arbitration proceedings, such as the seat of arbitration, procedural regulations, language, number of arbitrators, and the selection of arbitrators. |
Privacy |
Unless ordered otherwise by a judge, court proceedings are public. |
The arbitral proceeding is private and confidential. |
Enforcement |
There are three tiers of courts: First Instance, Appeal, and
Supreme. If the parties are dissatisfied with the judgment rendered
by the Court of First Instance, they can submit an appeal within
one month from the date of pronouncement of the judgment. |
An arbitral award is final. If the losing party fails to comply
with the arbitral award, the other party can pursue the recognition
and enforcement of the arbitral award across 172 jurisdictions
under the New York Convention. |
In conclusion, the choice between Thai court litigation and arbitration should fundamentally hinge on the nature of the agreement, the potential dispute, the nationality of the parties, and other relevant details, as each avenue offers distinct advantages and drawbacks. There is not a one-size-fits-all answer as to which option is superior. We hope that this succinct overview will assist you in making a decision tailored to your unique circumstances.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.