ARBITRATION IN THAILAND
(ALTERNATIVE DISPUTE RESOLUTION)

Arbitration in Thailand

Arbitration is a type of Alternative Dispute Resolution (ADR). It is a way of voluntary settling dispute(s) between parties who agree to submit such dispute(s) for resolution by one or more Arbitrators. Arbitration is a simple, speedy, and alternative to court action. It is intended to avoid the formalities, the delay, and the anxieties of court litigation. During Arbitration, the Arbitrator(s) hear both sides of the disagreement. The disputing parties hand over their power to decide the dispute resolution to the Arbitrator(s), who renders an award after hearing the parties. An award is written to summarize the proceedings and give the decisions. It usually includes the Arbitrator’s reasons for the decision.

What is the difference between MEDIATION AND Arbitration in Thailand?

Mediation is also an out-of-court dispute resolution using a ‘third party’ called a Mediator. However, Mediators do not render an award, but facilitates communication between the parties and assists them in reaching a voluntary resolution of their dispute. Unlike in Arbitration, Mediation does not give the Mediators the power to order the parties for settlement nor to order its outcome. In case the issues are unresolved in Mediation, the parties may have to proceed with other methods such as Arbitration or pursue through the court process (litigation).

How can the parties choose to settle their dispute by Arbitration?

It is essential to include an Arbitration clause when making a contract. This will state that both parties agree to go through Arbitration proceeding in case dispute arises in the future. Otherwise, the dispute shall go to the court. In the arbitration clause, they can decide to select the arbitrator, seat of arbitration, arbitral rules, governing law, languages, and so on. It is best to discuss and contemplate on the dispute settlement options as alternative proceedings may cost higher than litigation.

What is an Arbitrator?

An Arbitrator is an independent and impartial person or a body officially appointed to settle a dispute outside of court. He or she must not have any interest in the argument or in the result of the Arbitration. Most importantly, the arbitrator must have no personal bias that that could be detrimental to the right of anybody to a fair and impartial award. They hold private hearings, which are less formal than a court trial. Arbitrators are usually professionals, most particularly experts in their specific area of legal dispute, such as lawyers, business professionals, or retired judges. The total number of the arbitrators must be in an odd number to jointly consider all the information and to make a decision with an award.  

How can the parties select and appoint an Arbitrator?

Arbitration proceeding allows the parties to select and appoint arbitrators themselves through two methods:

 

  1. Ad Hoc Arbitration grants the parties the right to select an Arbitrator and to elect procedures to administer the proceedings and the settlement of their issues. This typically applies to smaller disputes.
  2. Institutional Arbitration is through organized bodies such as Arbitration Institutes or Arbitration Centers. The parties will have the liberty to choose their Arbitrator from the list of suggested Arbitrators by the Center. These Institutions do not actually participate in settling the dispute but help administer the Arbitration and provide a set of rules to govern the proceeding’s framework and regulation. This method is more prevalent as most Centers will have standardized procedures, which complies with the legal requirements.

 

There are many institutes and centers, which provide Arbitration services in Thailand. This includes Thailand Arbitration Center or THAC, the Thai Arbitration Institute, and the Thai Commercial Arbitration Office, the Board of Trade of Thailand. Other centers in foreign countries are the International Chamber of Commerce (ICC) and the American Arbitration Association (AAA).

What are the advantages of going through dispute resolution by Arbitration in Thailand?

Faster, Efficient, and Simplified Proceedings

You can usually obtain date for the Arbitration a lot faster than a court hearing date. Hearings can conveniently be scheduled based on the availability of the parties and the Arbitrator. As a result, you can complete an arbitration proceeding swiftly without complicated procedures.

 
Informality

Compared to court proceedings with juridical protocols, an arbitration proceeding is in an informal setting. It is more likely a general meeting of the parties to negotiate and settle the dispute. Moreover, in some cases, arbitration does not need translation of the documents.

 
Confidentiality

Arbitration is usually in a private setting. All the information, evidences, statements, and arguments brought up in the dispute, as well as its resolution can be kept completely confidential. This is beneficial to renowned public figures and businesses as it helps maintain their good reputation. On the other hand, court proceedings are usually done in public, so there is a risk of access to potentially sensitive information.

What types of disputes are commonly resolved through Arbitration in Thailand?

Arbitration proceeding mostly applies to civil cases, which are unrelated to marital or social status. According to the advantages stated above, most of the cases relate to contracts of new inventions or technologies, construction contracts in an industrial factory, trademark, patents, and so on.

If you are about to enter into an agreement, it would be best to consult with a lawyer to guide you with all the legalities. They will also help you to carefully consider which legal dispute proceedings shall be appropriate for your case.

Magna Carta Law Firm’s team of Civil Lawyers can best advice and assist you in any kind of disputes.  We can also  help you to draft, review, and, modify a wide range of contracts to prevent the complexity and find the best resolution for any unexpected disputes.