WT/TPR/S/255 Trade Policy Review 
Page 18 
  
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
(1) OVERVIEW  
1. Political issues have dominated the national ag enda since 2005.  In 2006 a military-led 
Council for National Security took over, leading to a new constitution and elections  in 2007.  In 2008, 
two short-lived coalition administrations were follo wed by a Democrat Party-led coalition, which was 
in office from December 2008 until Parliament was di ssolved in May 2011.  Elections were held on 
3 July 2011.  The period also saw demonstrations and unrest involving a number of groups.  These, as 
well as global economic instability have had some ef fect on the economy and th e investment climate, 
including a few weeks in November and Decemb er 2008 when Bangkok International Airport was 
closed.1 
2. The trade regime was relatively untouched a lthough some reforms were delayed, for example 
intellectual property legislation, privatization of PTT (the state controlled petroleum company) and 
EGAT (the electricity generation and transmission company), and decentralization.2  Despite the 
political problems, Thailand has managed to intro duce some reforms - such as setting up a regulator 
for the electricity sector, amending the Investment Promotion Act, and implementing the Patent 
Cooperation Treaty. 
3. Thailand continues to support the multilateral tr ading system and has been active in the WTO 
Doha Round with interests in agriculture, non-agricu ltural market access, intellectual property, rules 
including fisheries subsidies, and other issues. 
4. Over the years it has also remained committed to "open regionalism" and continues to 
negotiate an increasingly complex mesh of regional and bilateral trade agreements (section 6 (ii)). 
5. Thailand continues to operate a generally liberal foreign invest ment regime.  Negative lists 
restricting levels of foreign direct investment  in some activities have remained unchanged.  
Amendment of certain legal provisions is under wa y to prevent foreign investors from using nominee 
shareholders or preferential voting rights to take contro l of Thai companies in restricted sectors.  U.S. 
investors receive preferential treatment, being exempt from most restrictions on foreign direct 
investment under a 1966 Treaty. 
(2) GENERAL CONSTITUTIONAL AND INSTITUTIONAL FRAMEWORK  
6. The 2007 Constitution is now in force and w as amended in March 2011.  The Constitution 
follows the standard structure of previous charte rs, dealing with statehood  and sovereignty, the 
monarchy, citizens' rights and duties, a National Human Rights Commission, prescribed national 
policy objectives, government, Parliament, which h as a partly appointed (upper) Senate, the legal 
system, and other topics.  A 2011 amendment raised  the number of MPs in the (lower) House of 
Representatives to 500, with 375 in single-seat c onstituencies (replacing multi-seat constituencies) 
and 125 elected by proportional representation from pa rty lists.  The 3 July 2011 general election was 
for those MPs.  The constitutional basis for economic  policy is "Sufficiency Economy" (Section 83), a 
concept encapsulating the ideas of moderation, sust ainability, living within one's means and making 
ends meet.3  This is followed by 14 sub-paragraphs (i n Section 84) prescribing a free market economy 
                                                      
1 Economist Intelligence Unit (2011), and various earlier reports and update s;  and IMF (2010). 
2 ADB (2011). 
3 "Sufficiency Economy" ("sethakid phophiang") is a te rm coined by the King. It  is discussed at greater 
length in WTO (2008). From the point of view of practical economic policy it is interpreted as building Thailand WT/TPR/S/255 
 Page 19 
 
 
with financial discipline and without competition from  the public sector except  for specific security 
and social needs.  But they also  include such objectives as promo ting a fair income distribution, 
savings for old age, and the economic interests of  special groups such as farmers and minorities.  
International treaties involving sove reignty, security or economic or other interests - including trade 
agreements - have to be appr oved by Parliament, with adequa te public consultation.  Due 
consideration or compensation must be given to medium and small-scale enterprises and others who 
may suffer as a result.  A March 2011 amendment re quires an organic law to specify the types of 
these agreements that need parliamentary approval,  which may allow for more flexible free trade 
negotiations (Section 190 and amendment).4 
Source :   Information provided by the Thai authorities.Chart II.1
From policy to law:  how government-initiated legislation passes through the Thai system
Initiating Department
Ministry
Law Review CommitteeAgencies' commentsCabinet Secretariat
King's EndorsementSenateHouse of RepresentativesCouncil of State (legal advice)Cabinet
Royal Gazette
 
 
7. The Constitution provides for a judicial system cons isting of Courts of First Instance;  a Court 
of Appeal;  the Supreme Court of Justice, whic h includes a Criminal Division for Persons Holding 
Political Positions;  an independent  Constitutional Court;  administrative courts;  and specialist courts 
                                                                                                                                                                     
economic resilience to shocks, keeping investment and household debt within sustainable levels, and ensuring 
growth with stability. 
4 Royal Gazette , 24 August 2007, 4 March 2011.  Viewed at: 
www.ect.go.th/newweb/th/law/?GroupID=7, (in Thai) or www.ect.go.th/english/files/laws/ 
Constitution2540.pdf (in English) [3 0 May 2011];  Economist Intelligen ce Unit (2011);  and World Bank 
(2011), p. 80. WT/TPR/S/255 Trade Policy Review 
Page 20 
  
such as an Intellectual Property and International Trade (IPIT) Court.  Judges are appointed by the 
King on the recommendation of judicial commissions.  Because courts are independent, they are not 
under the Justice Ministry. 
8. The 2007 Constitution, like its 1997 predecessor, seeks further decentralization, devolving 
political and some fiscal power to local government organizations, prescribed in Chapter IX on local 
government.  This was discussed in some detail in th e previous Review of Thailand.  A key objective 
of decentralization, which is partly handled by th e 1999 Decentralization Act, is to reduce inequality 
between the regions, attracting development by boos ting infrastructure investment and by giving local 
government greater powers over decisions on infrastructure and services, supported by fiscal 
resources.  Progress remains slow - too slow to solve some of the country's pressing political 
problems, in the view of some experts.5 
(3) STRUCTURE OF TRADE POLICY FORMULATION  
(i) Executive branches of government 
9. At time of writing, the executive branch's role  in trade policy is largely unchanged since the 
previous Review of Thailand.  The last major administrative reforms were in 2002 leading to 
20 ministries (previously 14) and 162 departments within them.  No major changes have occurred 
since 2003.  Final responsibility for formulating tr ade and other economic policies remains largely 
with the Prime Minister and his Cabinet.  Th e Commerce and Finance ministries have the main 
responsibility for trade and investment policies, al though some authority exte nds to the Agriculture 
and Cooperatives, Industry, Public Health, Ener gy, Information Technology and Communications, 
and Transport ministries, and the Bank of Thailand  (the central bank).  The Department of Trade 
Negotiations in the Ministry of Commerce is main ly responsible for bilate ral and multilateral trade 
negotiations.  It consults widely with othe r government and non-government agencies.   
10. Also at the time of writing, the inter-agenc y Committee on International Economic Relations 
Policy, chaired by the Deputy Prime Minister for eco nomic affairs, and its s ub-committees, retains its 
main role of coordinating Thailand's intern ational economic policies among the ministries. 
(ii) Advisory, planning, and other bodies 
11. As was reported in the previous Review, various  institutions within the Government review 
and assess of public policies.  One is the Office of  the National Economic and Social Development 
Board (NESDB), under the Prime Minister's Office.6 No independent body is directly responsible for 
publicly evaluating or advising the Government on trade and sectoral assistance policies.  The 
NESDB's main function is to prepare Thailand's fi ve-year national economic and social development 
plans and monitoring their implementation (section (4) below).  It also monitors how well Thailand is 
meeting the Millennium Development Goals.7 Independent research institutes or Thai universities' 
research units regularly assess and analyse the impact of public policies, including on trade, often at 
the request of government agencies.  The results ar e normally made public or are available on request.  
The semi-governmental Thailand Research Fund ha s financed a Thai-language organization "WTO 
                                                      
5 See also, for example, Bangkok Post , "Reform is not something to be afraid of", 4 May 2011, 
interview with former prime minister Anand Panyar achun, who chaired the 2005 National Reconciliation 
Commission, and 2010 government-appointed National Reform Committee. 
6 NESDB online information.  Viewed at:  www.nesdb.go.th, accessed 31 May 2011. 
7 NESDB (2010b).  Among the many "achieved" points is the assessment that the country is meeting 
the goal of "addressing the special needs of the least developed countries" through official development assistance to Cambodia, Laos, and Myanmar. Thailand WT/TPR/S/255 
 Page 21 
 
 
Watch" involving a number of academics who have produced numerous books and articles, although 
the organization's website has not been updated since 2009.8 
12. The private sector interacts with the Govern ment formally and informally.  The Prime 
Minister chairs a Joint Public-Private Consu ltative Committee, which includes the three main 
private-sector associations:  the Thai Chamber of Commerce, the Federation of Thai Industries, and 
the Thai Bankers' Association.  On international tr ade, the Government regularly consults all three, 
while the Thai Chamber of Commerce is also responsib le for issuing certificates of origin.  The three 
are represented in the Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) and 
the WTO Committee, which the JSCCIB formed in 1999.  The WTO Committee aims to draw input 
from the private sector into multilateral negotiations so that Thailand's stance is directed towards 
enhancing Thailand's competitiveness.9  Other important committees with private, public, and 
academic representatives are the National Economi c Social Development Board, the Board of 
Investment, and the National Competitiveness Committee. 
(4) TRADE POLICY OBJECTIVES  
13. Overall, the Government's economic policy cont inues to favour liberal, market-based, private-
sector-driven growth, with a more recent additiona l focus on equity.  Competition is encouraged to 
ensure sufficient and sustainable economic growth in most sectors.  The strategy for "restoring 
Thailand's lost dynamism" - as the International Mone tary Fund describes it - is to remove some of 
the constraints on economic activity in order to en courage investment and reverse the sharp falls 
suffered since the 1990s.  The Government believ es this should rely on exports, with domestic 
demand as a secondary means, not by promoting one  sector over another, but by improving the 
environment for economic activity, widening its ge ographical scope, and then allowing business to 
decide whether to produce for the domestic or export market.10  Government policy does nevertheless 
have some selective focus in promoting local and fo reign investment in competitive industries, giving 
priority to technological development and building up intellectual property, including for small and 
medium-size enterprises, and exports and services. 
14. In practice, the picture is mixed.  Over the years some sectors have become more open to 
competition, such as steel, cement, chemicals, whiske y, and domestic aviation.  Some others have not 
or have only been partly liberalized, such as te lecommunications (including broadband licences) and 
some activities covered by state enterprises.  One assessment blames the delays on poor economic conditions, opaque regulations, inad equate laws, political uncertainty , and bureaucratic and public 
resistance.
11  Elections and changes of go vernment do not normally lead to major changes in trade and 
economic policy, although the degree of intervention in some sector s can alter, depending on political 
and other interests. 
15. In October 2011, the Eleventh National Economic and Social Development Plan for 2012-16 
was due to take effect.12  These five-year plans guide government policy and are designed to support 
the market economy, provide social safety nets, and act  where the market is less effective.  The 11th 
                                                      
8 Viewed at:  www.thailandwto.org, also with material on FTAs;  and Thailand Research Fund online 
information.  Viewed at:  ww w.trf.or.th/en/ [31 May 2011]. 
9 The WTO Committee has sub-committees on agriculture and fisheries, services, industrial goods, 
legal and investment issues, food safety, rules of origin, and government procurement under the WTO framework. 
10 IMF (2010). 
11 Economist Intelligence Unit (2010a). 
12 NESDB (2010a) and (2010b). WT/TPR/S/255 Trade Policy Review 
Page 22 
  
plan's theme is "a happy society with equity, fair ness and resilience" and it continues to follow many 
principles of the previous plans, including a philosophy of "Sufficiency Economy". 
16. The Eleventh Plan picks up a number of themes from its predecessor, which covered the 
period under review, including resilience to shocks , adaptability, balance, sustainability, good 
governance, and social fairness and harmony.  Themes gaining prominence even though they were in 
previous plans include the development of a creative, knowledge-based economy.  
Box II.1: "A happy society with equity, fairness and resilience" 
Extract from the 11th National Economic and So cial Development Plan 's executive summary: 
The Eleventh Plan adopts the "Philosophy of Sufficiency Economy" which has become the guiding light of the country's development 
since the Ninth Plan.  Even tho ugh the Philosophy has been a main ingredient im munizing Thailand along the development path for  
nearly ten years, it still takes time for all parts of the societ y to embed the tenet into ways of life.  There remain areas to  improve the 
country's resilience by encouraging the applica tion of the Philosophy to  all walks of life. 
In the preparation process, th e changing contexts of external environment a nd internal situations have been analyzed.  The 7 main global 
changes are global rules and regulations, the multi-polar global economy, th e ageing society, climate change, food and energy security,  
technological advancement, a nd international terrorism. 
For the internal situations, there are changes in many aspects.  Economic aspect , the fiscal risk has emerged due to rising public debt.  It 
is necessary to find new sources of income generation e.g. from  potential services and creative economy as there are more const raints on 
the income earned from the manufacturing and the agricultural sect ors due to limited industrial locations and arable land, chan ging 
climate situation, and e nvironmental regulations.  Social aspect , moving towards an ageing society will lead to a shortage of labor force 
in the future.  Increasing productivity ha s been constrained by low educational qua lity.  Dropping of standards of morality and  ethics and 
increasing in social inequality are cau ses of conflicts in the society. 
Natural resources and environmental aspect, natural wealth of the country has been depl eted and deteriorated.  Global warming has 
affected the agricultural sector, and food and energy security.  Spatial aspect, the development of communities, areas, and regions has 
been confronted with income disparity, rapid urba nization and slow progress of the decentralization. 
Lastly, n ational security aspect, it has been challenged by many factors includi ng conflicts in certain areas while enhancing good 
governance has been hindered especially from chronic corruption. 
Some risks and weaknesses have prevailed in the country's deve lopment.  They are weakness in pub lic administration, the unsustainable 
economic structure, declining pr oportion of working age population, loss of traditional values, de teriorating in the natural re sources and 
environment, and threats towards the nationa l security.  It is imperative to enhance resilience in order to prepare the people, economy, 
and society to effectively manage these changes.  Six areas of  resilience need to be maintained and improved including the cons titutional 
monarchy governed the country;  the agriculture as a main sour ce of income and food security;  the development based on knowled ge and 
advanced technology;  the society with good values and culture;  and the community as a key effective mechanism in development.  
With the guidance of the Sufficiency Economy  Philosophy, the framework of the Eleventh  Plan is set to be driven under the 
people-centred development and broad base pa rticipation approaches towards balanced, in tegrated, and holistic development.  To attain 
the agreed Vision of "a happy society w ith equity, fairness and resilience", the mi ssions, objectives, targets, and strategies are designed as 
follows: 
Missions are (1) to promote better income distributi on, and fair, harmony and demo cratic society in order to achieve better quality of l ife; 
(2) to create socio-economic security through strengthening prod uction of goods and services ba sed on knowledge, creativity and  
environmental friendliness, improving social  protection for better coverage, and ensuri ng food and energy s ecurity; and (3) to strengthen 
resilience to changes and crises and develop human resources. 
Main objectives are (1) to promote a peaceful society with good governan ce; (2) to promote sustainable development through 
restructuring the economy, society and politics, and nurturing na tural resources and environment; and (3) to prepare the people  and the 
community to be ready for changes. 
Key targets are (1) Thai society is more peaceful and has good governance; (2) all citizens acqui re social protection; (3) total factor 
productivity in every sector is increased; (4) shares of agricu ltural and service sectors in the economy are increased; (5) sha re of creative 
economy is increased; (6) Thailand's competitiveness ranking is improved; and (7) natural resour ces and environmental quality a re 
improved. 
Development strategies are (1) Strategy of promoting the just society;  (2) Strategy of developing human resources to promote a life-
long learning society;  (3) Strategy of ba lancing between food and energy security;  (4) Strategy of creating the knowledge-bas ed 
economy and enabling environment;  (5) Strate gy of strengthening economic and security  cooperation in the Region;  and (6) Stra tegy of 
managing natural resources and e nvironment towards sustainability. 
Source: NESDB (2010b). 
17. Thailand's trade policies conform to the nationa l plans' objectives including:  sustainability;  
free, fair and progressive trade liberalization;  income distribution and safety nets;  and good 
governance and transparency.  Trade has been driven by the privat e sector's success in exporting a Thailand WT/TPR/S/255 
 Page 23 
 
 
wide range of products, by the country's success in  sustaining a diversified economy that spans multi-
product agriculture, manufacturing, and services, and by successive governments' success in providing an attractive and more-or-less stable i nvestment climate in an export-oriented, business-
driven environment.  Thai trade policies build on this, aiming to strengthen Thailand's position as a 
competitive trading nation and service provider, w ith commerce as an engine of growth.  Trade 
diplomacy favours progressive liberalization multilate rally, regionally, and b ilaterally.  Unilateral 
liberalization is often undertaken for various purposes.
13 
18. However, the picture is not entirely liberal or ma rket-oriented.  Thai trade policy can also be 
susceptible to particular interests, political pressure , the remnants of older import substitution policies 
or "conflicts between upstream and downstream industries" (including agricultural products such as 
animal feed).  These may explain protection that remains through high or complex tariffs, quotas, and 
other measures, and delays in tariff reform.  Sectors benefiting from some protection include 
agriculture, motorcycles, alcoholic beverages, fabrics, paper products.14  While Thailand and its 
Cairns Group allies lobby for agricultural trade lib eralization in the WTO, it has also acknowledged 
that it needs contingency measures such as special safeguards in some instances. 
(5) TRADE LAWS AND REGULATIONS  
19. Reform of the legal and judicial  regime was a feature of the period covered by the previous 
Review of Thailand, but the National Law Reform Committee set up in 2004 was abolished with the 
change of government in 2006.  Political instab ility and changes of govern ment have delayed the 
programme.  
20. The Government or its ministries may issue regulations and notifications (announcements) 
under various laws without additio nal Parliamentary legislation, and these are commonly used to 
implement trade policies.15  Some concern has been expressed in the past about the complexity of 
Thailand's laws and regulations, but  in the period covered by this Review, the greatest regulatory 
uncertainty arose from two court cases.  One halted privatization in 2006 for the entire period under 
review.  The other held up investment in dozens of large-scale projects in the eastern seaboard 
industrial zone of Mab Ta Phut, fro m 2009 to 2010, on environmental grounds.16  While a few laws 
affecting business and trade were enacted in the pe riod, a number remained in preparation, for 
example on government procurement, energy, elect ricity, telecoms, e-commerce, and tourism. 
21. Efforts continue to streamline business's dealings  with the Government, particularly through 
various online services, such as the new "national single-point e-starting business service", which cut 
the average processing time for business registration from 4 days to 90 minutes.17  Reforms of this 
kind are needed because clearer rules and regulations  and more transparent institutional arrangements 
will make Thailand more attractive for foreign and dom estic investors.  Thailand's ranking is slipping 
                                                      
13 Some of the most recent unilateral tariff cuts ann ounced were on dual-fuel vehicles and their parts 
and components (World Bank, 2011, p. 81). 
14 Economist Intelligence Unit (2010a), section on competition policy;  APEC Secretariat (2009), 
section on non-tariff measures. 
15 For example, applied tariffs may be increased up to 50% above the statutory rates.  Other important 
issues requiring inter-ministerial coordination but not pa rliamentary approval  include:  investment incentives;  
VAT, excise, interior taxes, and surcharges;  controls on imports and exports;  and anti-dumping and 
countervailing policies.  
16 Economist Intelligence Unit (2010a, p. 12). 
17 World Bank (2011), p. 79. WT/TPR/S/255 Trade Policy Review 
Page 24 
  
in the World Bank's Doing Business reports, scoring well in protecting investors, licensing, and trade 
regulations but poorly on obtaining credit, taxation, and starting a business.18 
Table II.1 
Main trade-related legislation, June 2011 
Legislation Description 
Anti-Dumping and Countervailing Duty Act, B.E. 2542 
(1999) Ministry of Commerce can impose anti-dumping or countervailing 
measures 
The Safeguard Measures on Increased Imports Act B.E. 
2550 (2007) A committee headed by the Commerce Ministry and including the Finance 
Ministry can impose safeguards measures 
Bankruptcy Act (No.5), B.E. 2542 (1999) Amendments to bankruptcy provisions 
Corporatisation Act, B.E. 2542 (1999) (also called Capital of State Enterprise Act) Provides regulatory framework for conve rting state enterprises to private 
or public limited companies 
Direct Sales and Direct Marketing Act, B.E. 2543 (2000)  Protect s consumers against business opera tors taking "wilful advantage " of 
them through deception or coersion.  In ternet sales and marketing seem to 
be covered 
Electronic Transactions Act, B.E. 2545 (2002) Governs both civil and commercial electronic transactions 
Establishment of and Procedure for Bankruptcy Court 
Act, B.E. 2542 (1999) Established the Bankruptcy Court and sets out the rules governing its 
procedures 
Foreign Business Act, B.E. 2542 (1999) Replaced the 1972 Alien Business Law.  Identif ies the scope of foreign 
participation in businesses in Thailand 
Investment Promotion Act, B.E. 2520 (1977), amended 
B.E. 2534 (1991) and 2544 (2001)  Sets up the Board of Investment a nd provides for investment promotion 
Governing Leasing of Immovable Property for 
Commercial and Industrial Purposes Act, B.E. 2542 
(1999) Rights to lease commercial or industria l property for a term of 30-50 years, 
to use as loan collateral, to tr ansfer leases, and to sub-lease 
Money Laundering Control Act, B.E. 2542 (1999) Combating illicit  drug trade and corruption.   An Anti-Money-laundering 
Prevention and Suppression Office established 
Price of Goods and Services Act, B.E. 2542 (1999), and 
Trade Competition Act, B.E. 2542 (1999) Replaced the 1979 Act on Price Fixi ng and Anti-Monopoly;  Trade 
Competition Act aims to promote free  and fair competition by preventing 
monopoly;  administered by the new Trade Competition Commission 
Protection of Layout Designs of Integrated Circuits Act, B.E. 2543 (2000);  Protection of Plant Varieties Act, B.E. 2542 (1999);  Trade Secret Act, B.E. 2545 (2002);  
Copyright Act (No. 3), B.E. 2542;  Patent Act (No. 3), 
B.E. 2542;  Patent Act, B.E. 2522 (1979);  Trademark Act, B.E. 2534 (1991) Intellectual property protection, including protection of trade secrets 
Quarantine Act (No. 2), B.E. 2542 (1999) Quarantine regulations 
Land Code Act (No. 8), B.E. 2542 (1999), Condominium 
Act (No. 3), B.E. 2542 (1999) Foreign ownership of land and property 
Customs Act Customs and import pro cedures, including customs valuation 
Telecommunications Business Act, B.E. 2544 (2001) Defines ty pes of telecommunication licen ces, licensing scheme, network 
interconnection, rights of way, ta riff regulations, universal service 
obligations, and the role and responsibilities of the National 
Telecommunication Commission (NTC) 
Act on Organizations to Assign Radio Frequency Spectrum and to Regulate Broadcasting and 
Telecommunication Services, B.E. 2543 (2000) National Broadcasting Commission (NBC) 
Life Insurance Act, B.E. 2535 (1992) 
Non-life Insurance Act, B.E. (1992) Provide for licensing requirements and procedures, technical reserves, 
solvency margins, security deposits;  administered by the Department of 
Insurance 
Table II.1 (cont'd) 
 
 
                                                      
18 World Bank Group (2011), cited in Economist Intelligence Unit (2010a), p. 12.  The summary of 
changes to business regulations in Thailand, June 2009 to June 2010, says:  "Thailand made registering property 
more costly by repealing a 2-year temporary tax reduction for property transfers.  Thailand temporarily lowered taxes on business by reducing its specific business tax for 12 months." Thailand WT/TPR/S/255 
 Page 25 
 
 
Legislation Description 
Commercial Banking Act, B.E. 2505 (1962) To be replaced by the new Financial Institutions Act, which is designed to 
strengthen supervisory practices and pr ocedures in line with international 
best practices.  It will combine the Commercial Banking Act and the Act 
on the Undertaking of Finance Busine ss, Securities Business, and Credit 
Foncier Business, thereby creating a uniform standard of supervision 
Act on Undertaking of Fina ncial Business, Securities 
Business, and Credit Foncier Business, B.E. 2522 (1979) Covers finance business for commer ce, development, disposition and 
consumption, housing and other types pr escribed by ministerial regulation.  
Legislation also covers the formati on of a company and application for a 
licence for finance, securities,  and credit foncier companies 
Public Company Act, B.E. 2544 (2001) Listed companies e xpected to benefit in terms of management and new 
tools to enhance efficiency in generating investor returns.  Aims to 
promote debt workouts and raise the stock exchange to international 
standards.  Key features include the abolition of the minimum par value for 
shares and provision of debt to equity  conversion to assist creditor-debtor 
workouts 
Mercantile Marine Promotion Act, B.E. 2521 (1978) Provisions on possible measures to promote the maritime transport sector, 
prevention and prohibition of unfair practices, registration of maritime 
transport, port and shipyard opera tors, and submission of data and 
information to relevant authority 
Source: Information provided by the Thai authorities. 
22. Thailand has made efforts to meet its WTO obligations on transparency and notification in 
most areas (Table II.2).  
Table II.2 
Latest notifications under WTO Agreements to June 2010, or from August 2007 to June 2010 
Agreement Requirement/content Document symbol, date of latest 
notification (and period covered or 
content)) 
Agreement on Agriculture  
Articles 10 and 18.2 Table ES:1 and ES:2 - Export subsidies G/AG/N/THA/69, 26 October 2009 
(2007–2008) 
Article 18.2  Table MA:1 - Administration of tariff quotas G/AG/N/THA/70, 12 February 2010 
(2008–2009) 
Article 18.2 Table MA:2 - Imports under ta riff quotas G/AG/N/THA/71, 12 February 2010 
(2007–2008) 
Article 18.2 Table DS:1 and the relevant supporting tables - 
Domestic support G/AG/N/THA/72, 27 October 2010 
(2005–2007) 
Article 5.7 and 18.2 Table MA:5 - Use of special  safeguard provisions G/ AG/N/THA/68, 26 October 2009 
(2007–2008) 
Customs valuation 
Article VII Customs valuation legi slation (date of application) G/VAL/N/3/THA/1, 7 November 2008 
Agreement on Implementation of GATT Article VI of the GATT 1994 (Anti-dumping)  
Article 16.4 Ad hoc reports of anti-dump ing actions G/ADP/N/178, 27 November 2008 
 Semi-annual reports of anti-dumping actions (taken 
within the preceding six months) G/ADP/N/209/THA, 10 February 2011 
Article 16.5 Competent authorities G/ADP/N/14/Add.31, 26 April 2011 
Agreement on Import Licensing Procedures  
Article 7.3 Replies to questionnaire  G/LIC/N/3/THA/3, 30 September 2010 
GATT Article XXIV (Regional Trade Agreements) 
Article XXIV:7(a) Free-trade agreement between ASEAN and Australia-
New Zealand WT/REG284/N/1, S/C/N/545, 9 April 2010
 Free-trade agreement between ASEAN a nd Japan WT/REG277/N/1, 14 December 2009 
 Free-trade agreement between Thaila nd and Japan WT/REG235/N/1, S/C/N/419, 
29 October 2007 
Table II.2 (cont'd) WT/TPR/S/255 Trade Policy Review 
Page 26 
  
Agreement Requirement/content Document symbol, date of latest 
notification (and period covered or content)) 
Enabling Clause  (GATT L/4903) Free-trade agreement be tween ASEAN and India WT/COMTD/N/35, 23 August 2010 
 Free-trade agreement between ASEAN and Rep. of 
Korea WT/COMTD/N/33, S/C/N/560, 
8 July 2010 
Agreement on Safeguards  
Articles 9 (footnote 2)  12.1(a), 
12.1(b), 12.4 Preliminary determination,  investigation initiated, 
provisional safeguard (glass block) G/SG/N/6/THA/1, 7  January 2011;  
G/SG/N/7/THA/1, G/SG/N/8/THA/1, 
G/SG/N/11/THA/1, 7 January 2011 and 
suppls1, 28 January 2011;  
Article 12.6 Safeguards legislation ( 2007) G/SG/N/1/THA/3, 27 August 2009 
Agreement on the Application of Sanitary and Phytosanitary Measures  
Article 7 and Annex B Notification of SPS me asures Latest:  G/SPS/N/THA/203, 26 May 2011, 
total 72 (August 2007 to May 2011, 
including addenda and revisions) 
General Agreement on Trade in Services  
Article III:3 New or ame nded laws or regulations 
(Telecommunications Act;  Financial Institutions 
Businesses Act;  Life Insurance Act ;  Non-Life Insurance Act) S/C/N/486–489, 16 March 2009;  
Articles III:4, and IV:2 Enquiry and cont act points S/ENQ/78/Rev.11, 26 October 2009 
Article V:7(a)  Free-trade agreement between ASEAN and Rep. of 
Korea WT/COMTD/N/33, S/C/N/560, 
8 July 2010;  and S/C/N/560/Add.1, 
3 May 2011 
 Free-trade agreement between ASEAN and Australia-
New Zealand WT/REG284/N/1, S/C/N/545, 
9 April 2010 
 Free-trade agreement between ASEAN and China S/C/N/463, 2 July 2008 
 Free-trade agreement between Thaila nd and Japan WT/REG235/N/1, S/C/N/419, 
29 October 2007 
GATT Article XVII  (State Trading Enterprises)  
GATT Article XVII:4(a)  and 
Paragraph 1 of the Understanding 
on the Interpretation of Article XVII Notification of state trad ing enterprise (Public 
Warehouse Organization) G/STR/N/12/THA, 8 July 2008 
Agreement on Subsidies a nd Countervailing Measures  
Article 25.1 Notification of subsidies G/SCM/N/186/THA, 12 November 2009 
Article 25.11 Semi-annual repor t on countervailing duty actions  G/SCM/N/203/Add.1/Rev.1, 
20 October 2010 
Article 25.12 Competent authorities G/SCM/N/18/Add.23, 24 April 2007 
Agreement on Technical Barriers to Trade (TBT)  
Article 2.10.1 Notification of Pu blic Health Ministry entitled, 
"Cooking Brine (No. 2)" G/TBT/N/THA/360 
6 December 2010 
Article 2.9.2 (Draft) Notification  Rules and Procedures for Storing 
of Hazardous Substances (liquefied petroleum 
cylinders) G/TBT/N/THA/387, 
24 June 2011 
Article 5.6.2 Notification of the Th ai Industrial Standards Institute 
on Prescribing the Inspection Criteria for Licensing G/TBT/N/THA/383 
1 June 2011 
Agreement on Trade-Related Aspects of  Intellectual Property Rights (TRIPS)  
Article 69 Notification of contact point s http://www.wto.org/english/tratop_e/trips_
e/trips_notif5_art69_e.htm  
Article 63.2 Notification of laws  and regulations (implementing 
the patent cooperation treaty) IP/N/1/THA/2, 9 March 2010 
Sources:  WTO documents, available on the WTO website for exampl e at www.wto.org/thailand;  http://spsims.wto.org;  
www.wto.org/english/tratop_e/tr ips_e/trips_toolkit_e.htm.  Thailand WT/TPR/S/255 
 Page 27 
 
 
(6) TRADE AGREEMENTS AND ARRANGEMENTS  
(i) Thailand and the WTO 
23. Thailand accords at least MFN treatment to all WTO Members, but not necessarily to non-
members.  Thailand is neither a member nor observer of the WTO plurilateral Agreement on 
Government Procurement;  however, it partic ipated in the multilateral Working Group on 
Transparency in Government Procurement when that  was part of the Doha work programme.  As a 
party to the Ministerial Declaration on Trade in Information Technology Products (the Information 
Technology Agreement), Thailand phased out tariffs  on eligible products in 2005 (Chapter III). 
24. In the Doha Development Agenda negotiations , Thailand has been active in a number of 
areas.  One of its priorities has been agricultural trade reform to open markets, eliminate export 
subsidies, and make deep cuts in trade-distorting domestic support.  Its position is that of a strong 
exporting developing country whose view of the "d evelopment dimension" in cludes the need for poor 
farmers to have real access to both developed and developing markets, albeit allowing for some 
protection through more moderate forms of Special Products (whose tariff cuts will be smaller than 
prescribed by the formula) and the Special Safegua rd Mechanism for developing countries.  These 
positions are expressed through negotiating coalitions  such as the Cairns Group and G-20 as well as 
Thailand's own statements.  Thailand is also ac tive in the non-agricultu ral market access (NAMA) 
negotiations, jointly submitting proposals on sectoral liberalization and other issues (it is one of a 
small number of developing countries that would apply a version of the Swiss formula for tariff 
reductions), in "zeroing" and fisheries subsidies under  the rules talks, and in trade facilitation.  In 
intellectual property, it supports proposals for am ending the TRIPS Agreement in two areas:  to 
require patent applicants to disclose the origins of genetic material and any associated traditional 
knowledge used in inventions, and to show eviden ce of prior informed consent and benefit sharing 
("the disclosure proposal" under the relations hip between TRIPS and the UN Convention on 
Biological Diversity);  and to extend the enhan ced protection of geographical indications (TRIPS 
Article 23) beyond wines and spirits ("GI extension").19 
(ii) Preferential, regional, and bilateral arrangements 
25. Thailand, on its own and through ASEAN, ha s begun to focus attention on regional and 
bilateral free-trade agreements.  Nevertheless there are some subjects that Thailand has considered to 
be priorities that are still best handled multilaterally, including agricultural subsidies, anti-dumping disciplines, and improved dispute settlement. 
26. Over the years Thailand has remained committed to "open regionalism", and has joined other 
members of the Association of Southeast Asian Na tions (ASEAN) in turning the ASEAN Free Trade 
Area (AFTA) into an ASEAN Economic Community  (AEC) by 2015.  The AEC includes lowering 
non-tariff barriers, trade facilitation and free trade in services, and is part of a triumvirate that also includes Political-Security and Socio-Cultural communities.  At their annual Summit in May 2011 
ASEAN leaders agreed to work fo r an ASEAN Community by 2022, in which the group would have a 
                                                      
19 Since its last Trade Policy Review, Thailand has jointly authored over 20 official proposals and 
statements in the Doha work programme, in the TN/* seri es of documents, including revisions.  These are on:  
NAMA sectorals and flexibilities;  patent disclosure under TRIPS-CBD and GI extension;  zeroing, "public 
interest" and lesser duty rate in anti-dumping;  and the "single window" in trade facilitation (viewed at:  
www.wto.org/thailand).  There were no TN/* series do cuments from Thailand in agriculture during the period 
because negotiations on this subject had developed to  the stage where a few proposals were submitted as 
informal "JOB" documents, while most of the negotiation was by oral responses to the draft modalities as they were revised and partly stabilized in 2007-08. WT/TPR/S/255 Trade Policy Review 
Page 28 
  
common voice on the world stage, be strengthened internally, and have a stronger Secretariat.20  
However, some analysts question how much of th is can be achieved on schedule, arguing that a 
number of deadlines have been missed, including  Thailand's own delays in allowing foreign 
ownership in services and in setting up "single-window"21 customs procedures that will allow ASEAN 
customs agencies to link up directly.22 
Chart II.2 
ASEAN ‘Noodle Bowl’ 
Bloc-to-bloc or bloc-to-country Country-to-country Under negotiation
SAFTA  = South Asian Free Trade Agreement; APTA  = Asia-Pacific Trade Agreement (previously known as Bangkok 
Agreement, negotiated under UN-ESCAP); BIMSTEC  = Bay of Bengal Initiative for Multi-Sectoral Technical and 
Economic Cooperation (under negotiation); AFTA  = ASEAN Free Trade Area; AEC = ASEAN Economic Community 
(under negotiation); Trans-Pacific SEP  = Trans-Pacific Strategic Economic Partnership Agreement; NAFTA  = North 
American Free Trade Agreement; TPP = Trans-Pacific Partnership (under negotiation) 
Source : Data from Asia-Pacific Trade and Investment Agreements Database (APTIAD, www.unescap.org/tid/aptiad/),  
[July 2011]. Graphic adapted from an original by Mia Mikic. See Mikic, Mia (2009), ASEAN and Trade 
Integration , UN ESCAP Staff Working Paper 01/09, 8 April. Some agreements are not included. 
 
  
NAFTA
 
 
  
 
TPP 
 
 
 APTA  
 
    
 
   
 
 
BIMSTEC  
SAFTA 
 
 
EU China  Japan
EFTA 
Australia
New ZealandChile
Brunei
THAILAND
Malaysia
Indonesia
Laos
Ukraine  India
Bhutan  Pakistan  
Sri LankaBangladesh
Afghanistan  Nepal  
Rep. Korea
Maldives  
Jordan  Qatar Bahrain  
PanamaUS
Mexico CanadaPeru
Cambodia
Myanmar
ASEAN 
(AFTA, AEC)
Singapore
TRANS-PACIFIC SEP
Philippines
Viet NamChinese 
Taipei
Hong Kong, 
China
Macao,  China
 
                                                      
20 ASEAN Secretariat (2008b), (2008a), (2011), and (2010a). 
21  The term "single window" is used in two senses .  Domestically, it means access to several agencies 
at once:  traders can have their imports and exports pr ocessed by going literally or electronically to a single 
place to access Customs, other requirements, and finance.   Regionally in ASEAN,  it means linking up the 
countries' customs departments so a shipment can be pr ocessed by Customs at either  end, through the single 
window. 
22 Sussangkarn and Nikomborirak (2011);  an d information from the Thai authorities. Thailand WT/TPR/S/255 
 Page 29 
 
 
27. Beyond ASEAN, the picture of Thailand's free- trade agreements is complicated, sometimes 
simultaneously involving bila teral and regional deals (Chart II.2 and Table II.3).23  For example, 
Australia-Thailand trade is governed by an agreem ent between the two countries as well as a pact 
between two groups in which each is a member :  Australia-New Zealand, and ASEAN.  For 
businesses, the complexity can be baffling.  They  may face additional costs going through the hoops 
to find out which agreement is most suitable for a particular transaction, to get hold of the right 
paperwork, and to obtain the correct clearance.  This may be one of the reasons why some of the 
agreements have been little used, a situation rec ognized openly by political leaders in at least one 
case:  the free trade agreement between ASEAN and the Republic of Korea.24  The Asia-Pacific 
Economic Cooperation (APEC) group's 88-page 2008 study of 30 agre ements involving its members 
(five involving Thailand) found that the agreements were similar in some areas, such as customs procedures, but diverged considerably in others, particularly rules of origin.
25 
Table II.3 
Status of bilateral and regional trade agreements 
(% of tariff lines ex cept where specified)  
Agreement Goods Services Investment Signed Tariff cuts start Zero tariffs 
Thailand-Australia 5.7.2004 1.1.2005 Australia: 
1.1.2010 = 96.07% 1.1.2015 = 100% Thailand: 
1.1.2011 = 94.30% 1.1.2025 = 100%  Talks to resume after 
implementation as agreed by both 
parties 
 Talks framework passed by 
Parliament 
Thailand-
New Zealand 19.4.2005 1.7.2005 New Zealand: 
1.1.2010 = 88.46% 1.1.2015 = 100% Thailand: 
1.1.2010 = 91.60% 1.1.2025 = 100%  Talks to commence as agreed by 
both parties 
 Talks framework passed by 
Parliament 
Thailand-Japan 3.4.2007 1.11.2007 Japan: 
1.1.2010 = 80.66% 
1.4.2010 = 80.66% 
1.4.2022 = 88.49% Thailand: 
1.1.2011 = 53.50% 
 
1.4.2017 = 100% Proposed talks in services 
(movement of natural persons) 
Thailand-Peru 
(early harvest) 13.11.2009 Delayed Peru: 
2010 = 50% 
2015 = 70% Thailand: 
2010 = 50% 
2015 = 70% Discussions under way on resuming 
negotiations 
Thailand-India (82 tariff lines) 9.10.2003 1.9.2004 India: 
1.9.2006 = 100% of 
82 lines Thailand: 
1.9.2006 = 100% of 
82 lines Negotiations under way 
ASEAN (ASEAN 
Trade in Goods 
Agreement, ATIGA) 26.2.2009 Various dates 1.1.2010: 
Malaysia = 98.4% 
Singapore = 100% Indonesia = 98.7% 
Philippines = 99.0% 
Brunei = 99.2% (Cambodia, Laos, Myanmar, Viet Nam:  
normal goods: 
1.1.2010 = 0 - 5% tariff 
1.1.2015 = 0% tariff) Thailand: 
1.1.2010 = 99.8% 
 Eighth set of 
offers to be 
submitted in 2011 Investment 
agreement being 
ratified 
Table II.3 (cont'd)
  
                                                      
23 Mikic (2009), and (2007). 
24 ASEAN Secretariat online information, ASEAN- Republic of Korea relations:  viewed at:  
www.asean.org/7672.htm [8 June 2011].  Figures on trade between Thailand's FTA partners are readily 
available;  figures on the proportion of the trade that actually makes use of  those agreements are more difficult 
to find, and where available are based on certificates of origin issued for shipments that do not always take 
place. 
25 APEC Secretariat (2008b).  The agreements  involving Thailand were:  ASEAN (AFTA), 
ASEAN-China, Australia-Thailand, New Zealand-Thailand, and Peru-Thailand. WT/TPR/S/255 Trade Policy Review 
Page 30 
  
Agreement Goods Services Investment Signed Tariff cuts start Zero tariffs 
ASEAN-China 29.11.2004 Early harvest 
HS 01–08: 
1.1.2004 
Fruit and vegetables 
HS 07–08: 
1.10.2003 General goods 
20.10.2005 China: 
1.1.2010 = 86.4% Thailand: 
1.1.2010 = 83.0% Parliament has 
approved 2nd set 
of access in 
services Effective 
15.2.2010 
ASEAN-Japan 11.4.2008 For Thailand 
1.6.2009 Japan: 
1.1.2010 = 79.50% 
1.4.2010 = 79.50% 
1.4.2023 = 85.80% Thailand: 
1.1.2011 = 53.50% 
 
1.4.2018 = 97.85% Being prepared 
ASEAN-Korea, 
Rep. of 27.2.2009 1.1.2010 Rep. Korea: 
1.1.2010 = 92.3% Thailand: 
1.1.2010 = 84.1% 
1.1.2012 = 92.2% 1.1.2017 = 95.4% Effective 
1.1.2010 Effective 
31.10.2009 
ASEAN-India 13.8.2009 1.1.2010 India: 
31.12.2013 = 70.18%31.12.2016 = 79.35% Thailand: 
1.1.2011 = 16.30% 31.12.2013 = 70.90%
31.12.2016 = 79.34%Consultations under way 
ASEAN-Australia-
New Zealand 27.2.2009 12.3.2010 Australia: 
12.3.2010 = 95.96% 1.1.2020 = 100% 
New Zealand: 
12.3.2010 = 95.96% 1.1.2012 = 90.13% 
1.1.2020 = 100% Thailand: 
12.3.2010 = 72.29%1.1.2015 = 89.77% 
1.1.2020 = 98.80% Negotiations on 
further access in services in 
3 years Tables of 
reservations against 
liberalization in 
5 years 
BIMSTEC (Bay of Bengal Initiative for 
Multi-Sectoral 
Technical and Economic 
Cooperation) n.a. n.a. India, Sri Lanka, 
Thailand (targets) 
Fast track 
1.7.2013 = 10% Normal track 
1.7.2014 = 48% Negotiations 
under way  
n.a. Not applicable. 
Source : Department of Trade Negotiations, Bangkok, July 2011. 
28. Bilaterally, Thailand has four free-trade or  economic-partnership agreements, with 
Australia (2005), New Zealand (2005), India (for 82  goods tariff lines, 2004), and Japan (2007).  The 
early harvest provisions of an agreement with Pe ru were signed in November 2010 but have not 
entered into force.  In 2006, talks with the Un ited States and Bahrain were suspended and with the 
European Free Trade Association (EFTA) were "put on hold".  The EU started negotiating with ten 
ASEAN members as a group but in 2009 switched to bilateral talks with Si ngapore, Malaysia, and 
more recently Viet Nam while exploring bilatera l negotiations with others, including Thailand.  
Negotiations continue with India on the remaini ng goods tariff lines and on services and investment.  
New bilateral talks have begun with Chile. 26 
29. ASEAN as a group has concluded five free-trad e agreements in goods only, or goods and 
services: with China (goods 2005, a first group of  services 2007, and investment February 2010); 
Japan (2007, for Thailand 2009);  Republic of Ko rea (initially 2006, with Thailand signing on in 
2009, broader goods and services Ja nuary 2010 and investment October 2009);  India (goods 2010);  
and Australia and New Zealand (March 2010).  Negotiations continue w ith India on services and 
                                                      
26 Information from the authorities;  Department of Trade Negotiations, FTA online information. 
Viewed at:  www.thaifta.com/english/index_eng.html [30 May 2011];  Economist Intelligence Unit (2010a);  APEC Secretariat (2009), pp. 85-91;  EFTA online inform ation.  Viewed at:  www. efta.int/free-trade/ongoing-
negotiations-talks/thailand.aspx [31 May 2011];  and European Commission EU Trade, "Overview of FTA and 
other Trade Negotiations", updated May 2011. View ed at:  http://trade.ec.europa.eu/doclib/docs/2006/ 
december/tradoc_118238. pdf [30 May 2011]. Thailand WT/TPR/S/255 
 Page 31 
 
 
investment and with China on a second group of servi ces.  Regionally, Thailand is also involved in 
continuing negotiations on the Bay of Bengal Initia tive for Multi-Sectoral Technical and Economic 
Cooperation (BIMSTEC).  It has not joined the Trans-Pacific Partnership (TPP) negotiations.27 
30. Most (11) but not all of these preferential arrangements have been notified under the WTO 
Transparency Mechanism for Regi onal Trade Agreements (RTAs). They are:  ASEAN-Australia-
New-Zealand;  ASEAN-China;  ASEAN-India;  ASEAN-Japan;  ASEAN-Republic of Korea;  ASEAN Free Trade Area (AFTA);  Global System of Trade Preferences among Developing Countries (GSTP);  Japan-Thailand (WT/REG235/ series of documents, 2011);  Laos-Thailand;  
Thailand-Australia (WT/REG185/ series of doc uments, 2006-07);  and Thailand-New Zealand 
(WT/REG207 series of documents, 2007).  BIMSTEC is notified as an "early announcement" (still 
under negotiation).
28 
(a) Preferential arrangements for developi ng and least developed countries 
31. Thailand provides preferential tariff treatment  on certain imports from other developing 
countries under the GSTP (Chapter III).  According to the authorities the utilization rate of GSTP 
treatment for Thai exports remains low because onl y a limited number of products are eligible, and 
because the differences between regular tariffs a nd preferential GSTP rates are not attractive enough.  
In 2010, up to US$34.1 million worth of exports came under the GSTP (figures based on rules of 
origin certificates, not actual exports), with US$23. 7 million for Republic of Korea and the rest to 
India, Sri Lanka, and Brazil.29 
32. Some Thai exports benefit from preferentia l treatment under Generalized Systems of 
Preferences (GSPs) or similar arrangements in a number  of markets:  accordi ng to the Department of 
Foreign Trade these are:  the United States, Eur opean Union, Japan, Canada, Switzerland, Norway, 
Turkey, and Russia and ten other members of  the Commonwealth of Independent States.30  T h e  
schemes are largely unchanged since the Thailand's pr evious Review.  Total exports under the GSP 
are estimated at about US$11-13 billion (US$12.9 billi on in 2010), less than 10% of total exports - 
and about 55% of total exports of  the goods eligible for GSPs.  Most GSP exports were to the EU 
(61% of the total), and the United States (28%), followed by Turkey, Switzerland, Canada, Japan, and 
Norway.  In Japan's case, the G SP figures are low because trade also takes place under the free-trade 
agreement:  only about 200 items are now under the GSP.31 
33. The United States - once Thailand's largest expor t market but now down to fourth after the 
EU, China, and Japan - has extended Thailand's priv ileges annually.  The last major change was in 
July 2006, when nine Thai products (fresh durians, dried papayas, dried tamarind, rice flour, candied 
fruit and nuts, preserved papayas, oil cake, cat hode-ray-tube and video-cassette-recorder colour 
                                                      
27 Information from the Thai authorities;  Economist Intelligence Unit (2010a);  APEC Secretariat 
(2008c), pp. 85-91;  EFTA online information. View ed at:  www.efta.int/free- trade/ongoing-negotiations-
talks/thailand.aspx [31 May 2011];  and Thai Foreign Ministry online information.  Viewed at:  
www.mfa.go.th/bimstec/bimstecweb/htm l/background.html [30 May 2011].  TPP countries are Australia, Brunei 
Darussalam, Chile, Malaysia, New Zealand, Pe ru, Singapore, United States and VietNam. 
28 WTO Regional Trade Agreements Information System. Viewed at:  http://rtais.wto.org 
[1 June 2011]. Other databases containing information on ASEAN and Thai trade agreements include APEC's (viewed at:  http://fta.apec.org), which is searchable in some detail, and UN ESCAP's Asia-Pacific Trade and 
Investment Database (viewed at: www.unescap.org/tid/aptiad). 
29 Information from the Thai authorities. 
30 Viewed at:  http://www.dft.moc. go.th/level3.asp?level2=26 accessed 14 June 2011, in Thai.  Not 
listed were Australia and New Zealand, whose GSP schemes might have been superseded by their free-trade 
agreements with Thailand. 
31 Data from the Department of Foreign Trade. WT/TPR/S/255 Trade Policy Review 
Page 32 
  
televisions, and jewellery and non-electrical orname nts) were reinstated, but four types of goods 
(cereals, canned lychees and longans, aluminium pr oducts, and plastic goods) were dropped.  The 
United States raised the tariff on Thai gold jewellery from 0% to 5.5%, in July 2007.32  The risk of 
losing GSP privileges in the United States is one reason for the Government's efforts to tighten 
intellectual property protection, so that it can be  removed from the Section 301 Priority Watch List. 
34. Under its 2006 GSP programme the EU restored benefits for Thailand in fishery products, 
edible preparations and beverages,  plastic and rubber, leather and fu r skins, footwear, and consumer 
electronics.  New GSP rates were introduced in 2005 to help Thai shrimp exporters who were 
suffering from the tsunami of December 2004, but other sectors have lost the pr ivileges, i.e. vehicles, 
aircraft, vessels and associated transport equipment,  and jewellery.  As the result of its negotiations 
with WTO Members on enlargement (under GATT Article XXVIII), from January 2007 the EU 
lowered its rate on cooked poultry meat from Thaila nd to 8% (from 10.9%), and raised the quota for 
the quantity that can be imported into the EU at this preferential rate.  In May 2011, the programme 
was rolled over until the end of 2013.  The Thai G overnment hailed the move as good news, since the 
country's exports to the EU under the scheme were  worth over B 8 billion in 2010.  Among the other 
products expected to benefit were auto pr oducts, spectacle lenses, and air conditioners.33 
(b) Regional arrangements 
ASEAN34 
35. Thailand is a founder member of the Associati on of South-East Asian Nations (ASEAN);  it 
participates in the ASEAN Free-Trade Area (A FTA), set up 1993 and now moving towards an 
ASEAN Economic Community by 2015.  ASEAN econom ic integration aims to promote the region's 
competitive advantage as a single production unit through greater economic efficiency, productivity, and competitiveness.  ASEAN is Thailand's larg est preferential trading partner (Table II.4). 
36. On the goods side, ASEAN has integrated a ll its existing initiatives into a single legal 
instrument, the ASEAN Trade in Goods Agreem ent (ATIGA), signed at the ASEAN Summit in 
February 2009 and in effect on 17 May 2010.  The agreement covers tariff liberalization, rules of 
origin, non-tariff measures, trade facilitation, cu stoms, standards/technical regulations and 
conformity, assessment procedures and mutual rec ognition and harmonization agreements, and trade 
remedies.
35 
37. After the 1997 financial and economic crisis, memb ers agreed in 1999 to eliminate almost all 
import duties among the original ASEAN-6 members (Brunei Darussalam, Indonesia, Malaysia, the 
Philippines, Singapore, and Thailand) by 2010, which they did, and for the remaining ASEAN-4 
(Cambodia, Laos, Myanmar, and Viet Nam) to do so by 2015 with some flexibilities including 
                                                      
32 Economist Intelligence Unit (2010), p. 89.  Thailand was the top exporter to the United States under 
the GSP in 2010 at US$3.6 billion according to a re port citing US Census Bureau data. Viewed at:  
http://renewgsptoday.com/2011/02/11/gsp-imports-in-2010 -up-11-thailand-becomes-top-gsp-supplier-country/, 
11 February 2011. 
33 Economist Intelligence Unit (2010), p. 89;  Thai Public Relations Department news, "EU extends 
GSP for Thailand until Dec 2013", 7 June 2011. Viewed at:  http://thainews.prd.go.th/en/news.php?id=255406070011;  and European Commission online information. 
Viewed at:  http://trade.ec.europa.eu/doc lib/html/147958.htm [14 June 2011]. 
34 ASEAN Secretariat online information. Viewed at: www.aseansec.org;  and UN Economic and 
Social Commission for Asia and the Pacific, Asia-Pacifi c Trade and Investment Da tabase (APTIAD). Viewed 
at:  www.unescap.org/tid/aptiad/ [2 June 2011]. 
35 ASEAN Secretariat online information.  Viewed  at: http://www.aseansec.org/24697.htm;  ASEAN 
Secretariat (2010b);  and Mikic (2009). Thailand WT/TPR/S/255 
 Page 33 
 
 
exceptions for "highly sensitive" rice and some othe r sensitive products.  Quant itative restrictions and 
other non-tariff barriers are also being eliminated.   
38. Thailand's latest consolidated Common Effec tive Preferential Tariff (CEPT) in 2010 shows 
zero-duty on imports from ASEAN countries on all the 8,300 eight-digit tariff lines listed — except 
for a small number of agricultural products — fresh  cut flowers, potatoes, non-roasted coffee, coffee 
husks and copra — whose duty is kept at 5% indefinitely.36  The ASEAN-4 have been implementing 
their Common Effective Preferential Tariff (CEPT) commitments according to the schedules agreed 
when they joined ASEAN. 
Table II.4 
Thailand's use of preferences under free-trade agreements, 2010 
Agreement Thai FTA exports 
(certificates issued) 
US$ million Imports from 
Thailand under 
FTAs 
US$ million % 
Thai-Australia 6,557.3 5,612.8 85.6 
Thai-New Zealand 745.5 – – 
Thai-India (82 early harvest products) 786.5 566.2 72.0 
Thai-Japan 7,145.8 4,771.8 66.8 
ASEAN-China 11,453.1 7,372.3 64.4 
ASEAN-Japan 1,928.2 26.0 1.3 
ASEAN-Rep. Korea 2,637.0 880.1 33.4 
ASEAN-India 2,705.1 899.7 33.3 
ASEAN-Australia -New Zealand 395.5 26.3 6.6 
Total outside ASEAN 34,353.9 20,155.2 58.7 
Thailand-rest of ASEAN (9) 25,553.3 14,024.1 54.9 
Total inside and outside  ASEAN 59,907.2 34,179.3 57.1 
 Total Thai imports 
US$ million Thai imports under 
FTAs 
US$ million FTA imports as % 
of total 
Thai-Australia 5,895.9 607.7 10.3 
Thai-New Zealand 507.6 219.0 43.1 
Thai-India (82 early harvest products) 182.9 21.0 11.5 
Thai-Japan 37,856.1 3,894.7 10.3 
ASEAN-China 24,239.4 4,146.2 17.1 
ASEAN-Japan (37,856.1) 38.1 0.1 
ASEAN-Rep. Korea 8,056.5 507.3 6.3 
ASEAN-India 2,252.7 33.8 1.5 
ASEAN-Australia -New Zealand (6,406.4) 1,996.5 31.2 
Total outside ASEAN 78,991.1 11,464.3 14.5 
Thailand-rest of ASEAN (9) 30,327.5 6,118.1 20.2 
Total inside and outside ASEAN 109,318.6 17,582.4 16.1 
Note This table is a rough indication of Thailand's trade under bilateral or regional agreements.  The top half deals with Thai  exports.  
 The Thai Government does not have figures for exports under pr eferential agreements, only the cer tificates issued for shipment s 
 eligible for preferences.  Th ese values are compared to trading partners' import figures based on their FTA certificates, whic h 
 may be a more accurate indication of actual imports - except for New Zealand, which does not issue FTA import certificates. 
 The bottom half deals with Thai imports.  Here, preferential trade is compared to total trade (preferential and non-preferenti al).  
 Import  figures in parentheses under ASEAN agreements with Japan and Australia-New Zealand are not included in the totals 
 below them because  of double counting with the bilaterals.  
Source : Department of Foreign Trade, Bangkok, June 2011. 
39. On services, ASEAN countries are also negotiati ng liberalization within the region under the 
1995 ASEAN Framework Agreement on Services (AFA S).  This aims to achieve commitments 
beyond those that members (except WTO-non-me mber Laos) made under the GATS, sometimes 
called "GATS-plus".  Eight packages have been nego tiated in five rounds of talks from 1996 to 2010.  
                                                      
36 ASEAN Secretariat online information. Viewed at: 
www.aseansec.org/documents%5CCEPT%5C2010-Thailand.pdf;  for the consolidated preferential tariffs for the 
ASEAN-6 see:  www.aseansec.org/24774.htm [ 2 June 2010];  and additional information from the Thai 
authorities. WT/TPR/S/255 Trade Policy Review 
Page 34 
  
Individual countries' commitments include those that  cut across all sectors and those that are specific 
to individual sectors, and exemptions from non-discrimination among ASEAN members.37  The aim 
is to gradually cover all sectors and all modes of  supply, and to achieve a free flow of services by 
2015, with flexibility.  The commitments have meant liberalized trade in priority sectors, i.e. air 
travel, e-ASEAN (telecommunications and IT services), healthcare, and tourism.  Thailand's ASEAN 
services commitments broaden the scope of servi ces activities beyond GATS for ASEAN members in 
business services, telecommunications, construction, financial services, tourism, recreational services, air transport, and maritime transport.  Neverthel ess, foreign equity limitations of 49% on commercial 
presence remain in the horizontal section, and Thaila nd is said to be well behind schedule on allowing 
foreign ownership in service sectors.
38  
40. Other agreements aim to promote trade, invest ment, and greater regional integration within 
ASEAN.  One example is the ASEAN Investment Ar ea (AIA), signed in October 1998, which aims to 
increase foreign investment from ASEAN and non-ASEAN regional sources by removing barriers to all ASEAN investors by 2010 and for all investors by 2020, with some exceptions.
39  Some areas are 
listed as sensitive and are excluded temporarily or fo r the longer term.  The February 2008 lists cover 
manufacturing, agriculture, fishery, forestry, mining and quarrying and re lated services.  Brunei 
Darussalam, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, and Thailand had until 
1 January 2003 to phase out their temporary exclus ions in manufacturing.   Cambodia, Laos, and 
Viet Nam had until 1 January 2010. 
41. The ASEAN Industrial Cooperation Scheme (A ICO), was signed in 1996 to promote 
investment projects that involve ASEAN compani es in two or more ASEAN countries by offering 
incentives such as preferential duties on components shipped from one ASEAN country to another for 
further manufacturing, for example car parts shipped from one ASEAN country for assembly in another.  One of the scheme's aims was to enc ourage technology-based investments in ASEAN.  As 
tariffs on trade within ASEAN have fallen to zero in  general, and although other incentives, such as 
local content accreditation and investment incentives ar e left as the key features the scheme is being 
wound down.
40 
42. These different ASEAN arrangements are being brought together into the ASEAN Economic 
Community (AEC) by 2015.  Its aim is to turn ASEAN into a single market and production base with 
the free flow of goods, services, capital, investment, and skilled labour.  To ensure progress is made, ASEAN has accelerated integration in 12 priority  product sectors, i.e. wood-based, automotive, 
rubber-based, textiles and apparel, agriculture-based, fishery, electronics, e-ASEAN (an initiative to 
strengthen the use of information and communications technology across the region, for electronic commerce, and more broadly for business, society, and government), healthcare, air travel, tourism, 
                                                      
37 "MFN exemptions".  In ASEAN documents, "most-favoured nation (MFN)" is used to describe non-
discrimination among the group's members. Therefore, MFN within ASEAN is actually preferential  compared 
to MFN in the WTO. 
38 ASEAN Secretariat online information.  Vi ewed at:  www.aseans ec.org/4949.htm and 
www.aseansec.org/6626.htm, and services agre ements and declaratio ns.  Viewed at:  
www.aseansec.org/19087.htm [2 June 2011].  See also Sussangkarn and Nikomborirak (2011). 
39 ASEAN Secretariat online informa tion.  Viewed at: www.asean.org/10341.htm [2 June 2011].  The 
AIA is based on coordination and publicity within ASEAN, opening all industries and granting national 
treatment immediately, with some exceptions phased out for ASEAN investors by 2010 and all other investors 
by 2020;  and making the investment regime easier to use and more transparent. 
40 ASEAN Secretariat online information. Viewed at: www.aseansec.org/6402.htm and 
www.aseansec.org/18266.htm [2 June 2011].  The website lists 129 approved projects up to 21 April 2005, most 
in the automotive industry:  see http://www.aseansec.org/6398.htm [2 June 2011].  Additional information from the Thai authorities.  Thailand WT/TPR/S/255 
 Page 35 
 
 
and logistics.  Key measures to be implemented w ithin a timetable for the priority goods sectors 
include: 
 duty-free trade on all identified products by 2007 for the original ASEAN-6 and 2012 for the 
newcomers ASEAN-4; 
 improving the rules of origin by making them more  transparent, predictable, and standardized; 
 adopting "substantial transformation" as an alte rnative criterion for determining a product's 
origin; 
 extending the application of the ASEAN ha rmonized tariff nomenclature (AHTN) for 
ASEAN's external trade; 
 developing a simplified, improved, a nd harmonized customs declaration form; 
 ensuring full implementation of the green lane  system for products traded under the common 
effective preferential tariff; 
 developing the single window approach, including electronic processing of trade documents 
nationally and regionally; 
 accelerating the implementation/development of  sectoral mutual recognition arrangements 
(MRAs);  and 
 harmonizing procedures for issuing visas to in ternational travellers and allowing ASEAN 
nationals to travel without visas within ASEAN.  
43. ASEAN's institutional mechanisms are also being strengthened, for example on dispute 
settlement under an ASEAN Protocol on Enhan ced Dispute Settlement Mechanism signed in 
November 2004.  The aim is to ensure the rele vant ASEAN economic agreements are implemented 
correctly and for disputes to be settled quickly. 
44. The ASEAN Plus Three (China, Japan, and Republic  of Korea) have studied creating an East 
Asia Free Trade Area (EAFTA) since 2002.  Although regular progress reports on studies are 
submitted to annual summit meetings, negotiations have yet to start.  However, cooperation continues 
in areas such as rules of origin, cu stoms issues, energy, food secur ity, sustainable forestry, climate 
change and many others. 41 
45. ASEAN-Japan:  This free-trade agreement entere d into force in June 2008 after 70 categories 
of goods were listed for intensiv e tariff reduction.  The agreement requires further negotiations on 
services and investment, which began in October 2010  and were scheduled to continue in 2011.  
Analysts say the agreement has little impact on Th ailand because of its bilateral agreement with 
Japan.42 
46. The ASEAN-China Free Trade Area (ACFTA) was signed in December 2004.  The goods 
part took effect in July 2005.  It aims to elimin ate most tariffs on trade between ASEAN and China by 
2012 and 2018.  Tariffs will not be eliminated acro ss the board, with cuts in some sensitive products 
still under discussion.43  Most tariffs are to be eliminated by 2012 for the ASEAN-6 and China, and by 
2018 for the rest of ASEAN.  Less than 100 lines at  the 6-digit level for the ASEAN-6 and China, and 
150 for the rest  are subject to progressive tariff cuts.44  On services, ASEAN and China signed the 
                                                      
41 ASEAN Secretariat online information.  Viewed at:  www.asean.org/20182.htm and 
www.asean.org/16580.htm [2 June 2011].  
42 Information from the Thai authorities;  and Economist Intelligence Unit (2010a), p. 14. 
43 Information from the Thai authorities;  and Economist Intelligence Unit (2006), cited in WTO 
(2008). 
44 WTO RTA database, "ASEAN-CHINA (Goods), Summary Fact Sheet", June 2008. Viewed at:  
http://rtais.wto.org/rtadocs/42/F actualDocs/English/ASEAN-China( G)_W.doc#FPS [8 June 2011]. WT/TPR/S/255 Trade Policy Review 
Page 36 
  
first package of an ACFTA Agreement on Trade in Services in January 2007 (effective July 2007).  A 
second package has been negotiated and approved by the Thai Parliament.45  The agreement goes 
beyond Thailand's WTO GATS commitments on education and transport services and on modes of supply for professional and tourism services.  An ag reement on dispute-settlement was also signed. 
47. ASEAN and the Republic of Korea (ROK) have agreements on trade in goods and services in 
place since 2006 and 2007, with Thailand signing on in 2009.  An agreement on investment took 
effect in October 2009.  These became a fully fledged ASEAN-ROK Free Trade Area (AKFTA) on 1 January 2010.  The sensitive list for goods will be  reviewed in 2012.  However the two sides' 
leaders have acknowledged that the agreement is under-used and pledged to encourage greater use.
46 
48. A comprehensive agreement between ASEAN and Australia-New Zealand was signed in 
2009 and took effect in March 2010, covering goods , services, and investment, including financial 
services, telecommunications, electronic commerce, and intellectual property.  The agreement requires non-tariff measures in goods to be reviewed  within two years (i.e. by 2012) and services 
commitments to be reviewed by 2013.
47 
49. An agreement on liberalizing goods trade be tween ASEAN and India was signed in August 
2009, two years after their original July 2007 target date for conclusion, and took effect from 
1 January 2010.  Consultations on services and inv estment started in 2008.  The Thai Parliament 
approved a negotiating framework for services and investment in November 2009.  The goods 
agreement was reached on eliminating duties on almo st 80% of tariff lines in two steps ending in 
2016.  Excluded are around 490 tariff lines, said to represent about 5% of total import value.  Among 
the difficulties faced in the talks were said to be  "Special Products" (palm oil, tea, coffee, and 
pepper).48 
Asia-Pacific Economic Cooperation (APEC) 49 
50. The APEC group's trade objective is "open regionalism" without necessarily creating a 
free-trade area of its own.  APEC's trade effo rts therefore focus more on its members meeting 
unilateral targets for liberalization and for bette r quality measures across the spectrum from customs 
procedures and standards to subsidies and continge ncy actions.  It even includes "model measures" 
that members could use when negotiating region al or bilateral free-trade agreements among 
themselves.50  APEC's aim is for its members to libera lize comprehensively, consistently with the 
WTO, without discriminating among the group's members or between them and the rest of the world, as described in the Action Agenda from the 1995 O saka Summit.  Despite that aim, many APEC 
economies, including ASEAN members, have either formed or are contemplating regional trading 
arrangements that give preferential trade terms to some APEC and non-APEC economies and not to 
others. 
                                                      
45 ASEAN Secretariat online information,  "ASEAN-China FTA".  Viewed at:  
www.asean.org/19105.htm; "RTA Fact  Sheet", viewed at:  www.aseans ec.org/Fact%20Sheet/AEC/AEC-12.pdf 
[8 June 2011];  and information from the Thai authorities. 
46 ASEAN Secretariat online informa tion.  Viewed at:  www.asean.org/7672.htm [8 June 2011];  and 
information from the Thai authorities. 
47 Information from the Thai authorities;  and Economist Intelligence Unit (2010), p. 14. 
48 Information from the Thai authorities;  and APEC Secretariat (2009), p. 88 and Annex 4. 
49 APEC Secretariat online informati on.  Viewed at:  www.apec.org. 
50 APEC Secretariat (2008a), Annex 2.  The "model measures" include safeguards, competition policy, 
environment, temporary entry for business purposes, customs administration and trade facilitation (prepared by 
the APEC Business Advisory Council or ABAC), electroni c commerce, rules of origin  and origin procedures, 
sanitary and phytosanitary measures, trade in goods, technical barriers to trade, transparency, government 
procurement, cooperation, dispute settlement, and trade facilitation. Thailand WT/TPR/S/255 
 Page 37 
 
 
51. Thailand intends to meet APEC's target of free and open trade, including in services and 
investment by 2020 for developing economies ( 2010 for developed economies).  The target is 
voluntary and non-binding and is to be achieved through concerted unilate ral liberalization.  
Individual Action Plans (IAPs) are road maps c ontaining APEC's members' intended actions in 
15 policy areas for achieving APEC's liberalization goa ls.  The action plans are updated and reviewed 
regularly:  Thailand's latest action plan study re port was written in 2008 and discussed in an APEC 
senior officials' meeting in February 2009.51 
52. Thailand's 2008-09 action plan review conclude d that Thailand has made significant progress 
towards achieving its goals, perhaps well ahead of sc hedule.  The report congratulates Thai officials 
for their efforts: economic and political instability has slowed progress but the reviews "must be 
conducted in light of realities and not a vacuum".  Among the concerns raised were the administration 
of customs and trade programmes, and suggestions  that they are sometimes non-transparent and non-
objective.52  Thailand has been active in the work on "model measures", in particular on cooperation, 
sanitary and phytosanitary measures, subsidies and countervailing measures, and anti-dumping.  It has 
also been active on reducing red tape and other aspects  of trade facilitation, one of three key parts of 
the 1995 Osaka Action Agenda.  The 2008-09 action plan 's review listed 16 improvements to customs 
procedures, involving electronic or online customs and financial processing, single-window or one-stop services, harmonized or standardized classifi cation and valuation for goods, more advanced 
technology such as x-ray container inspecti ons, and streamlined procedures in general.
53  These 
efforts contributed to APEC's aim of reducing transaction costs by 5% from 2001 to 2005 and a 
further 5% in 2006-10. 
Asia-Europe Meetings (ASEM)54 
53. The Asia-Europe Meetings are informal dialogues and cooperation programmes among 
European and Asia-Pacific "partners" who now number 48 (the 27 EU members, the European 
Commission, the ASEAN 10, the ASEAN Secretariat,  and Australia, China, India, Japan, Korea, 
Mongolia, New Zealand, Pakistan, and Russia).  Summ its have been held every two years since 1996, 
alternating between the Asia-Pacific and Europe.  A range of economic, political, security, and social 
issues are discussed at various levels, its achieveme nts described as "a dialogue facilitator", "a policy-
making laboratory", and "managing Europe-Asia relati ons".  As an example of the subjects covered, 
recent activities (in May 2011) included meetings on food security, sustainable forestry and water 
resources.  ASEM has been working on a Trade F acilitation Action Plan (TFAP) for some years, 
aiming to reduce non-tariff barriers, increase transp arency, and promote trade opportunities between 
the two regions.  It specifies bi-annual "concrete goals " in the priority areas of customs, standards and 
conformity assessment, public proc urement, quarantine and SPS, intellectual property, mobility of 
business people, and other trade activities, such as market access in distribution.55  The Asia-Europe 
Business Forum (ABEF) promotes regional cooperation in the private sector.  The ASEM Trust Fund 
also finances technical assistance on financial sector restructuring and addressing poverty. 
                                                      
51 APEC Secretariat (2009).  Among the sources used is WTO (2008). 
52 APEC Secretariat(2009), p. 12. 
53 APEC Secretariat (2009), pp. 91-95. 
54 Asia-Europe Foundation (ASEF) online info rmation, "ASEM Infoboard". Viewed at:  
www.aseminfoboard.org;  and EU Commission online information.  Viewed at:  
http://ec.europa.eu/trade/creating- opportunities/bilateral-relations/regions/asem/ [4 June 2011]. 
55 EU online informati on.  Viewed at:  
http://trade.ec.europa.eu/doclib/docs/2008/a ugust/tradoc_140018.pdf [4 June 2011]. WT/TPR/S/255 Trade Policy Review 
Page 38 
  
Other areas of regional cooperation 
54. Thailand participates in other sub-regional c ooperation or development groups.  APEC's 
2008-09 review of Thailand's action plan observes briefly that little progress has been made in 
negotiations for market access in goods under th e Bay of Bengal Initiative for Multi-Sectoral 
Technical and Economic Cooperation (BIMSTEC) b ecause of differences over exclusions, and no 
progress at all on services or investment.  BIMSTEC 's aim is to forge links between ASEAN and 
SAARC in trade, investment, and technical coopera tion, and to develop a free-trade area based on a 
framework agreement signed in 2004.  The original targets were for free trade to be phased in at a 
range of paces from 2007 to 2017.  A goods agreemen t was signed in June 2009 and each country was 
to attach tables listing the goods for tariff cuts or e limination, but so far no table has been submitted.  
Negotiations on services are under way.  Cooperation is in 13 priority sectors with the designated lead 
countries:  trade and investment; tourism; energy; technology; fisheries; transport and communications; agriculture; public health; poverty a lleviation; counter-terro rism and transnational 
crime; protection of biodiversity and the environment and natural disaster management; culture; and 
people-to-people contact.  Thailand leads the work on fisheries, public health, and people-to-people 
contact.
56 
55. Greater Mekong Subregional Economic Cooperation (GMS-EC)  involves Cambodia, the 
People's Republic of China (PRC, specifically Yunnan Province and Guangxi Zhuang Autonomous 
Region), Laos, Myanmar, Thailand, and Viet Nam.  Set up in 1992 with assistance from the Asian 
Development Bank (ADB), the programme aims to enhance economic re lations, covering nine 
priority sectors:  agriculture, energy, environment, human resource development, investment, telecommunications, tourism, transport infrastructure, and transport and trade facilitation.  The programme is built around "economic corridors" - development through appropriately designed 
infrastructure - using cross-border transport links fo r goods and services to encourage investment in 
areas that would otherwise be remote and inaccessi ble.  The programme also supports the ASEAN-
China Free Trade Area and ASEAN trade liberalization.
57 
56. The aim of Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (ACMECS), 
which covers a similar area (without China), is to bridge the economic ga ps among Cambodia, Laos, 
Myanmar, Viet Nam, and Thailand, and to promot e prosperity in the sub-region in a sustainable 
manner.  ACMECS seeks to build upon existing regional cooperation programmes and complement 
bilateral frameworks wherever po ssible and appropriate.  The key ar eas of cooperation are trade and 
investment facilitation, transport linkages, agricultu re, industry and energy, public health, tourism, 
and human resource development.  ACMECS support s the goals of ASEAN as well as other regional 
and sub-regional frameworks, and continues to form  a major component of Thailand's foreign policy, 
including assistance to other developing countries.58 
57. The Indonesia–Malaysia–Thailand Growth Tria ngle (IMT–GT), formed in 1993, seeks to 
accelerate economic transformation in less develope d neighbouring provinces in the three countries 
by promoting sub-regional economic cooperation to dr ive growth and development.  It now covers 
14 provinces in southern Thailand, 8 states of Peni nsular Malaysia, and the 10 provinces of Sumatra 
in Indonesia, with 70 million people.  The privat e sector plays a key role.  Its focus is on trade and 
                                                      
56 APEC Secretariat (2009), p. 89;  and Thai Fore ign Ministry online inform ation.  Viewed at:  
www.mfa.go.th/bimstec/bimstecweb/html/background.html [30 May 2011];  World Bank (2011), p. 81;  and 
information from the Thai authorities.  BIMSTEC began life as "Bangladesh, India, Myanmar, Sri Lanka and 
Thailand Economic Cooperation", but the name was changed when Bhutan and Nepal joined in 2004.  Details of 
earlier developments are in WTO (2008). 
57 Online information. Viewed at:  www.gmsec. org, and www.adb.org/gms/ [14 June 2011]. 
58 Online information.  Viewed at:  www.acmecs.org [14 June 2011]. Thailand WT/TPR/S/255 
 Page 39 
 
 
investment, technology transfer, production coopera tion, and use of natural resources, as well as 
development of infrastructure and transportation linka ges in the triangle area.  Work currently comes 
under a 2007-11 "roadmap" covering trade and invest ment promotion in the region;  agriculture, 
agri-industry and tourism;  infrastructure support and connectivity;  human resources development 
and natural resource management;  and institutional support and public-private sector collaboration.  
Thailand leads two of the six working groups, those on halal products and services, and on tourism.59 
58. The Asia Cooperation Dialogue (ACD) is a Thai initiative launched in June 2002 to serve as a 
"missing link" for all Asian sub-regions to create st rategic partnerships and cooperation.  Ministers 
from its 30 members have met annually, most recently  in Colombo (2009) and Teheran (2010).  Areas 
of cooperation include energy, agriculture, biotec hnology, tourism, poverty alleviation, information 
technology development, e-education, and finance.60 
(c) Bilateral arrangements 
59. As with regional pacts, Thailand believes that  bilateral free trade agreements can be an 
effective catalyst for liberalization and eventually a building block for the multilateral trading system.  
Thailand sees bilateral agreements as a means to ma intain and strengthen its shares in traditional and 
potential new export markets such as Japan, the Unit ed States, China, India, Australia, New Zealand 
and Peru.  In several cases negotiations on further liberalization continue even after implementation 
has begun. 
60. A comprehensive Japan-Thailand Economic Part nership Agreement (J TEPA) covering trade 
in goods and services as well as investment, t ook effect from 1 November 2007.  Tariffs were 
eliminated immediately on 31% of goods imported into Thailand, and on 86% of Thai exports to 
Japan.  For Thailand, tariffs on 5,495 products or 99. 82% of tariff lines are being cut or eliminated or 
set as tariff quotas over 10 years.  For Japan, the numbers are 8,612 products or 98.06% of tariff lines 
over 15 years.  The eventual aim for services, after ne gotiations are completed, is for Thai investors to 
be allowed to expand businesses such as spas, hotels,  and restaurants in Japan.  Japanese investors 
will have access to the Thai services market, beyond  its WTO GATS commitments, in advertising, 
logistics, consulting, computer and related services,  maintenance and repair for  household electrical 
appliances, wholesale trade and retailing in certa in products, luxury hotels, restaurants, and 
management consulting (general management , marketing management, human resources 
management, product management).  Thai investors w ill be allowed to invest in all industries except 
medicine, aerospace, oil production, energy, mining, fishery, agriculture, forestry and other related 
industries.  Japanese investors are allowed up to 50%  equity in manufacture of automobiles with no 
requirement to apply for authorization, subject to certain conditions.  Talks continue on further 
liberalization for Thai agricultural pr oducts and Japanese industrial products.61 
61. The Thailand-Australia Free Trade Agre ement (TAFTA) entered into force on 
1 January 2005.  It is to lead to the eliminati on of tariffs across all sectors by 2025 for Thailand and 
by 2015 for Australia;  around half of Thailand's ta riffs were eliminated upon entry into force, and 
most of the remaining tariffs were phased down an d eliminated by 2010.  The agreement aims to 
substantially improve the environment for bilate ral services, investment, and business mobility.  
                                                      
59 Online information.  Viewed at:  www.imtgt.org [14 June 2011]. 
60 Online information.  Viewed at:  www.acddialogue.com [14 June 2011].  Members are Bahrain, 
Bangladesh, Bhutan, Brunei Darussalam,  Cambodia, China, India, Indonesia,  Iran, Japan, Kazakhstan, Republic 
of Korea, Kuwait, Laos, Malaysia, Mongolia, Myanmar,  Oman, Pakistan, the Philippines, Qatar, Russian 
Federation, Kingdom of Saudi Arabia, Singapore, Sr i Lanka, Tajikistan, Thailand, United Arab Emirates, 
Uzbekistan, and Viet Nam.  For more information see WTO (2008). 
61 APEC Secretariat(2009), Annex 4;  World Bank (2011), p. 81;  information from the Thai 
authorities;  and WTO (2008). WT/TPR/S/255 Trade Policy Review 
Page 40 
  
Further negotiations on trade in services and investme nt were scheduled to start in 2008.  The Thai 
Parliament has approved a framework for these talks.  Thailand is also reported to be seeking further 
relaxation for trade barriers on its agricultural pro ducts, and on restrictions on Thais being employed 
in Australia.62 
62. The Thailand and New-Zealand Closer Economic  Partnership (CEP) Agreement, effective 
1 July 2005, aims to establish free trade by 2015 for New Zealand's imports and by 2025 for 
Thailand's, with tariff elimination or reduction ph ased in annually.  Again, further negotiations on 
trade in services and investment were scheduled to  start in 2008 and the Thai Parliament approved a 
framework for the talks.63 
63. The Thailand-Peru protocol on accelerating lib eralization of trade in goods and trade 
facilitation was signed in November 2005.  Early ha rvest provisions prescribe tariff elimination or 
reduction, phased in annually an d covering 70% of tariff lines by 2015 .  However this was delayed 
because three additional protocols were negotiate d and signed between 2006 and 2010, on rules of 
origin, converting tariff classification from the 2002 Harmonized System to the 2007 version, and third party invoicing.  At the time of writing th e two countries were going through their internal 
procedures to implement the early harvest.
64 
64. Talks between Thailand and India were delayed,  but have resumed.  Under a 2003 framework 
agreement, tariffs were eliminated on 82 items  as an early harvest between September 2004 and 
September 2006.  The framework covers four areas:   goods, services, investment, and other areas of 
economic cooperation.  In December 2010 talks r esumed on a comprehensive agreement covering all 
four areas as a "single undertaking" and at the time of writing were expected to conclude in 2011.65 
65. Preparations for Thai-EU free-trade talks rest arted in November 2010 after Thailand initially 
objected to including alcoholic drinks.  Thai o fficials say the first approach was from the EU.  
Thailand has not yet started negotiating but has consu lted stakeholders on a possible bilateral deal in 
goods, services, and investment, and has begun an im pact assessment.  A negotiating mandate has 
been submitted to Parliament.  Meanwhile, the EU is reported to be considering moving back to the 
idea of an agreement with ASEAN.66 
66. Tariff reductions under the agreement between Thailand and Bahrain were suspended in 
2006, reportedly because of Bahrain's obligations on  commitments with third countries under the Gulf 
Cooperation Council.  Thailand's inte rest is access to Middle Eastern markets, and the talks with 
Bahrain might evolve into an agreement with  the GCC.  A Framework Agreement on Closer 
Economic Partnership entered into  force on 29 December 2002.  The two parties exchanged a list of 
626 items, on which tariffs of 3% were to be eliminated immediately under an early harvest 
programme, with other tariffs were  to be eliminated by 2010. 
67. Other bilateral free-trade agreements that have been considered include with Chile 
(Parliament approved the negotiations framework in September 2010, with three rounds of talks 
scheduled for 2011), Pakistan, Papua New Guinea, and Hong Kong, China.  Talks with the United 
                                                      
62 World Bank (2011), p. 81;  information from the Thai authorities;  and WTO (2008). 
63 Information from the Thai authorities;  and WTO (2008). 
64 Information from the Thai authorities;  APEC Secretariat (2009), p. 88 and Annex 4;  and World 
Bank (2011), p. 81;  and WTO (2008). 
65 Information from the Thai authorities;  APEC S ecretariat (2009), p. 87 and Annex 4;  World Bank 
(2011), p. 81;  and WTO (2008). 
66 Information from the Thai authorities;  and World Bank (2011), p. 81. Thailand WT/TPR/S/255 
 Page 41 
 
 
States were suspended in 2006, and with the Eur opean Free Trade Association (EFTA) were "put on 
hold".67  
(7) TRADE DISPUTES AND CONSULTATIONS  
(i) Dispute settlement under the WTO 
68. Thailand continues to view WTO dispute settleme nt as a workable instrument that makes the 
multilateral trading system more stable and predicta ble.  However, the cost can be high when cases 
require outside expertise or legal services, which is why some cases are not pursued in the WTO.  In Thailand's view, increasing use of the dispute se ttlement system by developing countries means the 
Advisory Centre on WTO Law is an importa nt means of providing the legal expertise.
68 Thailand's 
proposals for improving dispute settlement in the Doha Round talks include increasing the number of 
Appellate Body judges and regulating "carousel" reta liation so that it matches better any harm caused 
by an infringement.69 
69. Thailand has been involved directly in 16 dispute cases under the WTO, 13 as complainant 
and three as respondent.  Three were initiated durin g the review period, one as complainant and two 
as respondent.  Two early cases (DS35 and DS181, see Ta ble II.5) were settled with mutually agreed 
solutions.  In five pre-2008 cases Thailand has not sought to move beyond the fi rst stage of requesting 
consultations.  A case brought against Thailand in 2 008 has similarly not moved to the next stage.  
The largest number of Thai complaints is still about  agricultural or fisheries products;  however, the 
range of products involved is br oadening, several involve anti-dump ing measures or safeguards, and 
most cases involve Thailand and either the Eur opean Union or the United States (Table II.5). 
Table II.5 
Dispute settlement cases, 2011 
No Dispute Complainants Request for 
consultation Panel 
report 
circulated / 
adopted Appellate Body 
Report 
circulated /  
adopted Arbitration 
requested /  
circulation of 
reports 
(a) Thailand as complainant      
       
DS17 European Communities — 
Duties on Imports of Rice Thailand 05.10.95 n.a n.a. n.a. 
DS35 Hungary — Export Subsidies 
in respect of Agricultural Products Argentina;  
Australia;  Canada;  New Zealand;  
Thailand;  United 
States of America 27.03.96 (Mutually 
agreed solution 
20.07.97) n.a. n.a. 
DS47 Turkey — Restrictions on 
Imports of Textile and 
Clothing Products Thailand 20.06.96 n.a. n.a. n.a. 
DS58 United States of America — 
Import Prohibition of Certain 
Shrimp and Shrimp Products India;  Malaysia;  
Pakistan;  Thailand 8.10.96 15.05.98 12.10.98 / 
06.11.98 n.a. 
     Table II.5 (con'td) 
  
 
                                                      
67 APEC Secretariat (2009), pp. 90-91;  Department of Trade Negotiations online information. Viewed 
at:  www.thaifta.com/english/index_eng.html [30 May 2011];  additional information from the Thai authorities;  Economist Intelligence Unit (2010a);  and EFTA online informati on.  Viewed at:  www.efta.int/free-
trade/ongoing-negotiations-talks/thailand.aspx [31 May 2011]. 
68 See WTO (2008). 
69 APEC Secretariat (2009), p. 79. WT/TPR/S/255 Trade Policy Review 
Page 42 
  
No Dispute Complainants Request for 
consultation Panel 
report 
circulated / 
adopted Appellate Body 
Report 
circulated /  
adopted Arbitration 
requested /  
circulation of 
reports 
DS181 Colombia — Safeguard 
Measure of Imports of Plain 
Polyester Filaments from Thailand Thailand 07.09.99 (Mutually 
agreed 
solution 27.10.99) n.a. n.a. 
DS205 Egypt — Import Prohibition 
on Canned Tuna with Soybean Oil Thailand 22.09.00 n.a. n.a. n.a. 
DS217 United States of America — 
Continued Dumping and Subsidy Offset Act of 2000 
(Byrd Amendment) Australia;  Brazil;  
Chile;  European Communities;  
India;  Indonesia;  
Japan;  Korea, Republic of;  
Thailand 21.12.00 16.09.02 16.01.03 / 
27.01.03 Article 21.3(c) 
(implementation period):  
14.03.03 / 
13.06.03 Article 22.6 
(retaliation):  
23.06.04 / 31.08.04 
DS242 European Communities — 
Generalized System of Preferences Thailand 07.12.01 n.a. n.a. n.a. 
DS283 European Communities — 
Export Subsidies on Sugar Thailand 14.03.03 15.10.04 28.04.05 / 
19.05.05 Article 21.3(c) 
(implementation period):  30.08.05 / 
28.10.05 
DS286 European Communities — 
Customs Classification of 
Frozen Boneless Chicken 
Cuts Thailand 25.03.03 30.05.05 12.09.05 / 
27.09.05 Article 21.3(c) 
(implementation 
period):  
09.12.05 / 20.02.06 
DS324 United States of America — 
Provisional Anti-Dumping Measures on Shrimp from 
Thailand Thailand 09.12.04 n.a. n.a. n.a. 
DS343 United States of America — 
Measures Relating to Shrimp 
from Thailand Thailand 24.04.06 28.02.08 16.07.08 / 
01.08.08 n.a. 
DS383 United States of America — 
Anti-Dumping Measures on 
Polyethylene Retail Carrier 
Bags from Thailand Thailand 26.11.08 22.01.10 / 
18.02.10 n.a. n.a. 
(b) Thailand as respondent       
       
DS122 Thailand — Anti-Dumping 
Duties on Angles, Shapes and Sections of Iron or Non-Alloy 
Steel and H Beams from 
Poland Poland 06.04.98 28.09.00 12.03.01 / 
05.04.01 n.a. 
DS370 Thailand — Customs 
Valuation of Certain Products 
from the European 
Communities European 
Communities 25.01.08 n.a. n.a. n.a. 
DS371 Thailand — Customs and 
Fiscal Measures on Cigarettes 
from the Philippines Philippines 07.02.08 15.11.10 17.06.11/ 
15.07.11 n.a. 
n.a. Not applicable. 
Note: Excludes the 48 disputes in which Thailand has been a thir d party.  Before December 2009, the European Union was known in  
the WTO as the Eur opean Communities. 
Source: WTO online information.  View ed at:  www.wto.org/disputes, 
 www.wto.org/english/tratop_e/d ispu_e/find_dispu_cases_e.htm.  Thailand WT/TPR/S/255 
 Page 43 
 
 
(ii) Other 
70. ASEAN's dispute settlement mechanism is similar to that of the WTO.  The authorities state 
that Thailand's trade and economic disputes with ot her ASEAN members have been reduced amicably 
through bilateral consultation/discussion.  Thaila nd has never used the formal ASEAN dispute 
settlement mechanism. 
(8) FOREIGN INVESTMENT REGIME  
(i) Recent developments 
71. Thailand maintains a relatively open foreign inv estment regime.  It views foreign direct 
investment (FDI) as vital to the economy's growth , and encourages investors from all sources;  FDI 
inflows have remained robust during the period unde r review (Chapter I), and Thailand is ranked a 
high 19th in the World Bank's Doing Business 2011  report and is well-placed in UNCTAD's World 
Investment Prospect Survey 2010–12 .70  The downside is that it has among the most stringent limits 
on foreign equity holding, according to another Worl d Bank publication with the majority of sectors 
compared subject to restrictions.71  Sectors fully open to foreign capital participation include light 
manufacturing, pharmaceutical products, and f ood products.  The Foreign Business Act B.E.2542 
(1999) lists sectors and business activities where fo reign ownership must be below 50%, although in 
some cases this can be raised with special permission.  Some restrictions are contained in laws specific to the sector, for example telecommunications. 
72. During the period under review, foreign inv estors were more concerned about political 
instability and unpredictability and less about some of  the issues such as infrastructure and the energy 
outages that featured in the previous review.   Am ong the concerns about uncertainty raised were a 
2009 court decision to halt temporarily dozens of  large-scale projects in Map Ta Phut, the country 's 
biggest industrial zone;  and the repeated postpone ment of the auction for third-generation mobile-
telephony licences.  Other weaknesses in Thailand 's investment environment include low education 
levels and a shortage of suitabl y qualified workers, infrastructure bottlenecks, particularly in and 
around Bangkok and the eastern seaboard, intellectua l-property rights violations, and red tape.
72 
(ii) Basic framework 
73. During the period under review no major ch anges were made to the regulatory and 
institutional framework governing fore ign investment in Thailand.  As  noted in previous Trade Policy 
Reviews, the legislation (Foreign Business Act B. E. 2542) dates back to November 1999.  The 
Foreign Business Act (FBA) maintains ne gative lists of restricted activities.73 
74. The Act does not apply where an international treaty, including the WTO, requires Thailand 
to provide national treatment to foreign investor s.  The 1966 Treaty of Amity and Economic Relations 
between the United States and Thailand extends na tional treatment to U.S. investors, thereby 
exempting them from most FDI restrictions.  Under the Treaty, Thailand can restrict U.S. investors 
only in communications, transport,  banking, exploitation of land or other natural resources, and 
domestic trade in agricultural products. 
                                                      
70 World Bank Group (2010a);  and UNCTAD (2010). 
71 World Bank Group (2010b). 
72 Economist Intelligence Unit (2010), p. 12, including the views of 13,000 executives surveyed in the 
World Economic Forum's 2010-11 Global Competitiveness Report . 
73 See WTO (2004) and (2008). WT/TPR/S/255 Trade Policy Review 
Page 44 
  
75. In early January 2007, despite widespread opp osition from foreign investors, the Government 
approved plans to amend the FBA to include voti ng rights as another criterion for determining which 
juridical persons are foreign in restricted sectors.  The proposed amendments covered the definition of 
"foreigners", punishment/penalties, and the "Lis t 3" businesses in which Thais are not competitive 
(see also Chapter IV(1)(i)).  Although the changes are not as far-reaching as initially expected, the 
move seems to have compounded investor concerns  over the unpredictability of policy.  Companies 
that seek or have already received Board of Invest ment promotion will not be subject to the proposed 
ownership rule revision, except in those activities sp ecified in List 1 where the Foreign Business Act 
requires Thai majority ownership, and in act ivities that fall under specific laws such as 
telecommunications, and marine, air, and land tran sport.  Currently, seven categories covering over 
273 activities in both manufacturing and services are eligible for BOI promotion. 
Land and labour restrictions 
76. Under the Industrial Estate Authority of Tha iland Act 1979, industrial operators are allowed 
to own land in an industrial estate or an industria l zone for carrying out their business activity to the 
extent that the Board of the Industrial Estate Authority of Thailand may deem appropriate.  The 
foreign investment must be a minimum of B 40 milli on, for at least three years, in a business that 
benefits the economy, promotes social welfare or is BOI promoted.  While non-Thai businesses and 
individuals may still own land only on government-approved industr ial estates, the Land Act as 
amended in 1999 allows foreign investors to own up to 1,600 square metres of land for residential 
purposes in certain areas, including the Bangkok Me tropolis.  Under the Condominium Act, as 
amended in 1999, foreigners may also own up to 49% of the total space of all units in a condominium, 
subject to certain conditions.74 For five years from the date of legislative change, up to 100% foreign 
ownership was allowed in the Bangkok Metropolis  and other areas specified in Ministerial 
Regulations where a condominium is situated  on land not exceeding 8,000 square metres 
(Condominium Act).  Under the Investment Promoti on Act 1977, a person may be permitted to own 
land for carrying on a promoted activity to the exte nt that the BOI deems appropriate.  The BOI may 
grant permission for foreigners to own land within specified limits for offices and residences of 
executives and employees (BOI Announcement No. 2/2546,  2003).  Foreigners may also construct 
buildings on leased land.  The Act on the Lease of Immovable Property for Industrial and Commercial 
Purposes 1999 allows a foreigner to lease property for commercial or industrial purposes for a period 
of not more than 50 years, renewable.  Leases can also now be used for loan collateral. 
77. Foreign workers in Thailand generally require in advance a work permit from the Ministry of 
Labour (Alien Employment Act, 1978).  A number of occupations and professions are closed to 
foreigners (1979 Royal Decree).  A one stop service has been set up by the BOI to facilitate the 
issuance of work permits.  Foreign nationals wo rking in Thailand must also meet immigration 
requirements. 
(iii) International agreements 
78. Thailand has been a member of the World Ba nk Multilateral Investment Guarantee Agency 
(MIGA) since 29 April 2000.  Thailand also has bilateral investment treaties (BITs) with 38 economies.  It is a party to the Agreement on the Promotion and Protection of Investments 
concluded amongst the ASEAN countries, and the Convention on the Recognition and Enforcement 
of Foreign Arbitral Awards (the New York Conv ention), and is a signatory to the International 
Convention on the Settlement of Investment Disput es between States and Nationals of other States 
(the ICSID Convention).  Althou gh it has modernized its own arbitration and conciliation rules 
                                                      
74 Foreigners may also use funds from local bank accounts to make such purchases instead of having to 
bring in foreign funds. Thailand WT/TPR/S/255 
 Page 45 
 
 
(Arbitration Act B.E. 2545 (2002) and Regulations on Compliance with  Arbitration Awards, 2001) in 
line with the UNCITRAL Model Law on Internationa l Commercial Arbitration, Thailand has been in 
the lengthy process of ratifying the ICSID Conventi on.  The authorities indicate that, in any case, 
foreign investors have access to other reliable dis pute settlement procedures under applicable BITs 
and FTAs that include ad hoc  arbitration under the UNCITRAL rules.  Other avenues being used by 
foreign investors to resolve disputes are the 1990 arbitration and conciliation rules of the private 
Arbitration Institute under the supervision of the Court of Ju stice, and the Thai Commercial 
Arbitration Rules administered by the Thailand Board of Trade.  The Department of Intellectual Property, Department of Insurance, and the Security and Exchange Commission also provide 
arbitration services.   
79. Apart from the non-MFN Treaty with the United States (Chapter IV(4)), Thailand has signed 
39 investment promotion and protection agreements  with other economies;  33 have entered into 
force.  These include the ASEAN Agreement on the Promotion and Protection of Investments.  The 
FTAs concluded with Australia, New Zealand, and Japan also  include a chapter on investment.  These 
agreements cover obligations on  national and MFN treatment, expropriation, transfers, fair and 
equitable treatment, and investor-sta te dispute settlement mechanisms.  
80. Thailand is pursuing further agreements with de veloped and developing countries, especially 
agreements that promote FDI and encourage tec hnology transfer.  Thailand has 54 double-taxation 
treaties, covering most of its major tradi ng partners, and is negotiating nine more.
75 Several of these 
agreements contain "tax sparing" provisions, includi ng those concluded with Japan, Australia, Cyprus, 
Denmark, Israel, Luxembourg, New Zeal and, Norway, Spain, and Switzerland. 
 
                                                      
75 Economist Intelligence Unit (2010), pp. 64-66.