Trade Disputes in Thailand

Thailand plays a pivotal role in regional and international commerce, supported by its strategic location in Southeast Asia, well-developed infrastructure, and participation in multilateral trade frameworks administered through bodies such as the World Trade Organization and the ASEAN. As trade volumes increase across borders, so too does the likelihood of commercial conflict. Trade disputes in Thailand arise from disagreements between private companies, investors, states, or regulatory authorities involving the flow of goods, services, tariffs, contracts, or competition. These disputes are critical to understand because they influence pricing stability, market fairness, foreign investment confidence, intellectual property integrity, and supply chain reliability.

Unlike general contract disagreements, trade disputes often intersect national policy, regulatory enforcement, international obligations, market access, tariff law, and industry-level competition. For both foreign and domestic stakeholders, understanding the types and consequences of trade conflict within Thailand’s jurisdiction ensures proactive risk management and stronger dispute-prevention strategy.

1. Import-Export Disputes

Among the most frequent trade disputes in Thailand are import-export conflicts. These commonly involve:

• Customs valuation disagreements

• Incorrect classification of goods under tariff codes

• Shipment seizures, port detentions, or rejected declarations

• Failure to meet Thailand’s safety or licensing requirements

• Disagreements over restricted or controlled product categories

These disputes directly intersect the enforcement authority of the Thai Customs Department. Importers and exporters must comply not only with declared pricing, but also product certification, packaging standards, import permits, quarantine compliance, export bans, and product-specific licensing protocols.

A common trigger includes disputes over HS Code classification. If Thai Customs Department applies a different classification than a company’s declared HS code, applicable import duties, VAT, or excise tax may increase substantially. While parties may contest the classification, goods can remain detained until assessment is completed or financial guarantees are deposited.

Agriculture-based product disputes may also intersect Thailand’s quarantine regulators when cross-border shipments carry biological or contamination risk. While port inspections may appear administrative, disputes escalate quickly when goods are detained in major shipping gateways.

Import-export disputes are legally important because they determine who bears detention penalties, storage costs, customs fines, and shipment clearance fees, particularly under commercial shipping contracts.

2. Tariff and Tax Disputes

Trade disputes in Thailand frequently involve disagreements over national tax obligations linked to commerce. These include:

• Corporate income tax disagreements

• VAT refund rejection, VAT misfilings, or VAT export exemptions

• Withholding tax disputes in trade contract payments

• Disagreements over Specific Business Tax exposure

• Disputes tied to transfer pricing penalties

These conflict areas intersect with the authority of the Revenue Department and pricing benchmarks published via national indices referenced by the central economic authority at Bank of Thailand for economic benchmarking.

For exporters expecting VAT refunds or VAT exemptions, disputes commonly arise when paperwork is incomplete, pricing is underdeclared, or corporate invoices fail regulatory review. For importers or corporate purchasers, disputes may emerge when the company invokes VAT exemptions or tax incentives that Thailand’s tax authority does not validate.

Transfer pricing disputes have risen among multinational companies trading cross-border or shifting profit via nominee pricing into Thailand. Revenue authorities may re-assess declared pricing, impose penalties, or reject informal pricing arrangements not supported by audited accounts.

Tariff disputes matter because misclassified tax exposure can destabilize company profit, delay customs clearance, damage M&A valuations, or invite penalties that later affect import license renewal.

3. Contract-Based Trade Disputes

Thailand’s commercial contract ecosystem, especially for distribution, supply, manufacturing, licensing, and international procurement, relies heavily on enforceability under the local contract statute defined by the Civil and Commercial Code. Contractual trade disputes commonly involve:

• Breach of supply obligation

• Non-delivery or late shipment

• Product quality disputes

• Price renegotiation failure

• Disputes over Incoterms, payment guarantees, or currency volatility

• Disagreements over corporate signatory authority

Even when contracts are signed, disputes may still be unenforceable if the person signing did not hold binding authority in corporate affidavits maintained through the business registry.

Contract-based trade disputes also often involve banking guarantees. If Thai banks do not validate a company invoice, guarantee, or escrow deposit correctly, disputes can later escalate into litigation for misdeclared contract obligations.

For international partners, currency-exchange disputes may emerge when contract price is framed in USD, EUR, or THB but volatility affects final payment liabilities. While negotiation often happens informally, enforceable outcome only comes through contract court review.

Contract disputes matter in trade because they govern long-term supply relationships—not just one transaction. Losing a trade contract dispute in Thailand often means losing an entire distribution territory or supplier network.

4. Competition and Market Access Disputes

Thailand maintains active trade discipline involving antitrust and competition enforcement. Common disputes include:

• Market exclusion or unfair access restriction

• Disputes over product dumping or predatory pricing

• Price cartel accusations

• Unfair distribution dominance

• Cross-brand franchise competition claims

These areas often intersect Thailand’s competition authorities rather than contract courts alone.

Franchise disputes involving global brand licensing—especially trademarks, retail monopolies, supply limitation, or franchise territory access—frequently involve competitive conflict risks. If licensing rights or territory exclusivity provisions conflict with competition law or disclosure requirements, trade disputes escalate into market-access disputes.

Competition disputes matter because Thailand’s rise as an economic hub depends on fair and transparent market accessibility. Unfair trade practices not only impact individual companies—they affect national pricing discipline and Thailand’s global credibility with international trade regulators.

5. Intellectual Property-Based Trade Disputes

Thailand treats intellectual property as a commercial asset under strict regulatory oversight. Trade disputes involving infringement or unauthorized licensing commonly include:

• Trademark infringement

• Counterfeit goods in import chains

• Patent licensing disputes

• Copyright commercialization claims

• IP-based distribution rights

These cases intersect directly with the IP registry authority via the Department of Intellectual Property.

Common dispute examples include businesses distributing goods under unverified trademark licenses, claiming rights to trade logos or brand exclusivity without valid authorization.

For example, companies that distribute coffee beverages or franchise materials illegally using brand assets may later face litigation or revenue seizure. If trademark licensing was not validated through the national IP registry or chain of regional corporate authority, Thai courts may rule that trade rights were never legally granted.

IP trade disputes matter because counterfeit imports can trigger goods seizure, financial destruction of companies, or escalation into criminal exposure if infringement is deemed intentional by Thai anti-counterfeit laws.

6. Logistics and Supply Chain Disputes

Thailand’s growing trade volumes depend heavily on transportation, warehousing, cold-storage chains, and freight handling systems monitored through structured port authorities, warehouse operators, airlines, and logistics partners. Common logistics disputes include:

• Port detention penalties

• Damage in bonded storage claims

• Cold-chain product spoilage disputes

• Warehouse lien disagreements

• Freight shipment insurance disputes

• Cross-border trucking liability disputes

These cases may intersect the enforcement authority of:

• Thai Customs Department (for bonded chain disputes)

• Port authorities or private logistics operators (for detention penalties and fleet claims)

Buyers often wrongly assume that owning shipping invoices, bills of lading, or delivery receipts grants them legal ownership. This is incorrect—legal access to release goods from Thai jurisdiction depends on verified filings, tax compliance, contract review, customs clearance, and authority of the registered goods owner.

A supply chain dispute resolved poorly may not only destroy one shipment—it can unravel a company’s supplier authorization for years.

7. Government and State-Linked Trade Disputes

Although many disputes involve private parties, Thailand also hosts state-linked conflicts involving:

• Trade barrier enforcement

• Government tender and procurement disputes

• Free-zone export incentive disputes

• Disputes involving national monopolized entities

• Cross-border state trade disagreements

These disputes may be escalated into treaty-level claim reviews administered under Thailand’s international obligations through multilateral agreements under the World Trade Organization.

State-linked disputes matter because they influence investor confidence, country-level compliance precedent, and regional cost-benchmark discipline.

Conclusion

Trade disputes in Thailand serve a central role in stabilizing commerce. They define tax liabilities, shipment clearance rights, intellectual property distribution integrity, competition discipline, logistics chain liability, and contract enforceability. Whether involving private companies, foreign investors, or cross-border trade partners, each dispute type protects Thailand’s market integrity while reducing systemic pricing and regulatory ambiguity.

Trade disputes are not simply commercial disagreements—they are the legal architecture ensuring Thailand’s economic credibility, transparent ownership, enforceable market access, and fair global participation in multi-country trade.