Category: Legal Updates

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U.S. Tariff Developments Post Supreme Court Ruling

Background

The U.S. Supreme Court’s decision in Learning Resources, Inc. v. Trump (February 20, 2026) represents a pivotal development in international trade law. The Court held that the use of the International Emergency Economic Powers Act (IEEPA) to impose broad-based import tariffs exceeded the scope of authority delegated to the President of the United States.

Although the ruling establishes clear constitutional limits on executive tariff authority, it does not diminish the central role of tariffs in U.S. trade policy. The administration’s swift recourse to alternative statutory mechanisms underscores continued reliance on tariff measures and heightens uncertainty for Thai exporters and other affected parties.

1.  Constitutional Limits on Tariff Authority

In a 6–3 decision, the Supreme Court reaffirmed that the constitutional authority to set tariffs is vested in Congress. The Court concluded that IEEPA does not provide sufficiently clear authorization for the imposition of broad-based import duties; accordingly, it cannot serve as a valid legal basis for such measures.

Notably, the Court declined to order immediate remedies. Instead, it remanded the question of refunds to the United States Court of International Trade, leaving implementation to be resolved through established customs law procedures.

2.  Refunds: A Legal Entitlement Subject to Procedure

Although the tariffs have been declared unlawful, recovery of duties paid is not automatic. Importers must act within the U.S. customs law framework, including by filing timely protests and, where necessary, pursuing claims before the United States Court of International Trade.

Recent developments indicate that the Court of International Trade is moving toward a more structured refund mechanism, potentially inclusive of interest. However, the process remains procedurally complex and administratively burdensome, requiring proactive engagement from affected importers.

3.  Policy Realignment: Section 122 Tariffs

In response to the ruling, the U.S. President promptly invoked Section 122 of the Trade Act of 1974 to impose a temporary tariff on imports from all countries. This measure reflects a strategic adjustment, demonstrating that the executive branch retains meaningful statutory tools to sustain its tariff policy objectives.

Key features of the Section 122 measure include:

  • A uniform global tariff rate of 10–15%;
  • A statutory ceiling of 15%;
  • A duration of up to 150 days, unless extended by Congress; and
  • Application in addition to existing duty obligations.

4.  Section 301 Investigation: Implications for 16 Jurisdictions

On March 11, 2026, the Office of the United States Trade Representative (USTR) initiated a Section 301 investigation covering 16 jurisdictions, including Thailand. The investigation examines whether certain trade practices constitute unreasonable or discriminatory conduct, with particular attention to structural overcapacity in the manufacturing sector.

The scope of the investigation remains broad and may extend to digital trade, pharmaceutical pricing, market access, and environmental policies. Under Section 301, the USTR is empowered to impose remedial measures, including additional tariffs and investment restrictions.

Thailand has been identified as a jurisdiction of concern, primarily owing to relatively low capacity utilization in the automotive, machinery, and rubber sectors, as well as concerns regarding potential tariff circumvention linked to increased foreign direct investment. These factors may result in heightened scrutiny of Thailand’s role in global supply chains.

The procedural timeline is as follows:

  • Government consultations;
  • Written submissions: March 17 – April 15, 2026;
  • Public hearings: commencing May 5, 2026; and
  • Expected completion within 150 days of initiation.

5.  Implications for Thai Exporters

The evolving U.S. tariff framework presents several material risks for Thai exporters:

  • Loss of competitive advantage: A uniform global tariff eliminates country-specific preferential treatment, reducing pricing differentiation.
  • Policy uncertainty: Temporary measures may be extended, modified, or replaced with more burdensome instruments.
  • Cost impact: Additional duties directly affect product pricing, margins, and overall competitiveness in the U.S. market.
  • Regulatory volatility: Rapid legal and policy shifts are increasingly a defining feature of U.S. trade policy, necessitating ongoing monitoring and agile response strategies.

6.  Practical Considerations

Thai exporters are advised to adopt a proactive and structured approach to managing tariff exposure. Recommended actions include:

  • Reviewing customs classification to ensure accuracy and minimize the risk of misclassification disputes;
  • Adjusting pricing and cost structures to reflect prevailing tariff obligations;
  • Monitoring import timing in accordance with U.S. customs entry requirements;
  • Coordinating with U.S. importers to preserve and exercise available refund rights; and
  • Conducting scenario planning to anticipate and respond to potential policy changes.

Conclusion

The Supreme Court’s ruling in Learning Resources, Inc. v. Trump establishes meaningful constitutional constraints on executive tariff authority; however, it does not diminish the central role of tariffs in U.S. trade policy. The administration’s swift transition to alternative instruments — notably Section 122 and Section 301 — confirms continued reliance on tariff-based measures as tools of commercial and geopolitical leverage.

While refund opportunities may arise for duties previously paid under IEEPA authority, recovery remains procedurally complex and requires active legal engagement. For Thai exporters, the combination of heightened policy uncertainty, increased cost pressures, and intensified regulatory scrutiny underscores the imperative for proactive compliance, rigorous strategic planning, and the full integration of legal considerations into business decision-making.

Author: Panisa Suwanmatajarn, Managing Partner.

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FDA: Food and Drug Administration Proposes Revised Food Advertising Notification

The Thai Food and Drug Administration (“FDA”) has issued a draft notification on food advertising (B.E. ….) (the “Draft Notification”), which proposes a comprehensive modernization of Thailand’s food advertising regulations. The existing framework, governed by the FDA Notification on Food Advertising B.E. 2564 (2021) (the “2021 Notification”), has been in effect since 31 March 2021. The Draft Notification is currently open for public consultation until 16 April 2026.

This initiative seeks to address practical challenges that have arisen since the implementation of the 2021 Notification. Key issues include the framework’s limited adaptability to evolving digital marketing practices, shifting consumer expectations, and the emergence of new product categories such as hemp-, cannabis-, and kratom-based items. The proposed revisions aim to resolve ambiguities faced by businesses, particularly concerning advertising claims and sustainability-related communications, while strengthening protections against misleading advertisements.

The Draft Notification introduces targeted amendments across five principal areas to enhance regulatory clarity, close existing gaps, and provide greater operational flexibility without compromising consumer safeguards.

Introduction of Product-Specific Advertising Rules:

The Draft Notification establishes dedicated advertising standards for specific food categories that were not adequately addressed under the current regime. These include:

  • Food supplements containing kratom; and
  • Food products incorporating hemp seeds, hemp oil, hemp protein, cannabis, or cannabidiol (CBD).

These provisions are designed to ensure appropriate oversight of these sensitive and increasingly prevalent product categories.

Revision of Prohibited Claims (Annex 1):

Annex 1, which lists prohibited claims regarding the quality, benefits, or properties of food, has been substantially revised. The previous fixed list of prohibited expressions is replaced by a broader, principle-based standard. Prohibited claims are now defined as those that create exaggerated or misleading expectations concerning the quality, benefits, or properties of food.

Specific examples that remain expressly prohibited include:

  • Terms such as “miraculous” or “extraordinary”;
  • Claims implying a cure, guaranteed results, or the absence of side effects; and
  • Statements suggesting endorsement or approval by the FDA.

The revised approach emphasizes the overall impression conveyed by the advertisement, enabling a more nuanced, case-by-case evaluation by regulators.

Expansion of Advertising Not Requiring Prior Approval (Annex 2):

The scope of advertising exempt from prior FDA approval has been broadened to better accommodate contemporary marketing practices. Permitted content now includes:

  • Expanded use of descriptive expressions related to taste, texture, and sensory attributes; and
  • Sustainability-related messaging, such as recycling symbols, carbon footprint indicators, and green certifications, provided they satisfy applicable conditions.

These updates facilitate more flexible communication while preserving safeguards against misleading practices.

Clarification of Advertising Requiring Prior Approval (Annex 3):

The Draft Notification provides clearer criteria for advertising that necessitate prior FDA approval, specifically claims relating to quality, benefits, or functional properties. Examples include:

  • Functional claims (e.g., those concerning probiotics);
  • “Free-from” claims (e.g., gluten-free); and
  • References to FDA-related awards or quality marks.

This clarification is expected to reduce uncertainty and promote greater consistency in regulatory application.

Revision of Warning Requirements in Advertising (Annex 4):

The framework for mandatory warning statements in advertisements has been updated to focus on relevance to specific advertising media. Additional warning obligations have been introduced for products involving kratom, cannabis, and hemp. The revised wording aims to enhance clarity and consistency across different media formats.

Regulatory Position:

The core elements of the existing regulatory framework remain intact:

  • Advertising concerning the quality, benefits, or properties of food continues to require prior FDA approval;
  • No new criminal penalties are introduced;
  • Non-compliance remains subject to penalties under the Food Act B.E. 2522 (1979); and
  • Regulatory authorities retain broad discretion in assessing whether advertisements are misleading or non-compliant.

Key Takeaways:

The Draft Notification represents a significant modernization of Thailand’s food advertising regime. Principal changes include:

  • Introduction of product-specific rules for emerging categories such as kratom-, hemp-, and cannabis-based products;
  • Transition to a principle-based approach for evaluating misleading claims;
  • Greater flexibility for descriptive and sustainability-related advertising;
  • Enhanced guidance on claims requiring prior approval; and
  • Updated warning requirements tailored to advertising media.

These amendments collectively promote a more structured, transparent, and market-responsive regulatory environment. As the Draft Notification remains subject to public consultation and has not yet been finalized, businesses are advised to monitor subsequent developments closely. It is recommended that affected entities evaluate the potential implications for their advertising strategies, internal review processes, and overall compliance frameworks.

Author: Panisa Suwanmatajarn, Managing Partner.

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Employment vs Liberal Profession

Thai Tax Treatment of Physicians under Sections 40 (1) and 40 (6) of the Thailand Revenue Code

Background

As Thailand’s healthcare sector continues to evolve, the engagement structure between physicians and private hospitals has become increasingly diverse. Traditional employment relationships are often replaced or supplemented by hybrid arrangements, including revenue-sharing models and per-case compensation structures.

Against this backdrop, a recurring tax issue arises – Should a physician’s income be classified as employment income under Section 40 (1), or as income from a liberal profession under Section 40 (6) of the Revenue Code?

The distinction is critical, as it directly affects the availability of deductions and the overall tax burden.

Legal Framework

The Thailand Revenue Code distinguishes between:

  • Section 40 (1): income derived from employment, including salaries, wages and similar benefits; and
  • Section 40 (6): income derived from liberal professions, namely arts of healing, expressly including the medical profession.

While the statutory wording appears clear, its application in practice is highly fact-specific and has been shaped by both judicial interpretation and tax rulings issued by the Revenue Department in response to tax inquiries under applicable law.

Judicial Approach : substance over form

Thai Supreme Court (Tax Division) jurisprudence has consistently adopted a substance-over-form approach in determining the nature of a physician’s income.

In Supreme Court Judgment No. 1802/2533, the Court considered a physician engaged by a private hospital under a service-based remuneration model. The physician exercised discretion in treating patients and was compensated based on services rendered.

The Court held that such income could fall within Section 40 (6), emphasizing that:

•   the exercise of liberal profession judgment is central to medical practice; and

•   the use of hospital facilities does not, in itself, create an employment relationship.

However, the Court made clear that where the factual circumstances demonstrate:

•   Subordination to hospital management;

•   Fixed working hours; and

•   Characteristics typical of employment,

the income must be classified under Section 40 (1).

Revenue Department Rulings : administrative perspective

The Revenue Department has addressed similar scenarios through a number of rulings, which largely align with the Supreme Court’s approach, albeit with a stronger focus on operational control.

In these rulings, the Revenue Department has generally taken the position that:

•   Physicians receiving fixed monthly remuneration;

•   Working under assigned schedules; and

•   Operating subject to hospital direction

derive income under Section 40 (1), regardless of how the contractual relationship is described.

Conversely, the Revenue Department has accepted classification under Section 40 (6) where:

•   Remuneration is based on actual services performed (e.g., per patient or procedure);

•   Income varies depending on workload; and

•   The physician retains meaningful professional independence.

Particular weight is often given to whether the physician bears economic variability, which is viewed as indicative of independent professional activity.

Converging Principles

Taken together, the Supreme Court decisions and Revenue Department rulings establish a consistent principle:

The classification of a physician’s income depends on the true nature of the working relationship, not the contractual label or the professional title.

Importantly, while medicine is recognized as a liberal profession under Section 40 (6), this does not automatically determine the tax treatment in every case. The decisive factor remains the degree of independence versus control.

Practical Implications

For physicians, misclassification may result in reassessment, denial of deductions and potential penalties. Reliance on contractual wording alone is insufficient; actual working conditions must support the intended tax treatment.

For hospitals, engagement structures should be carefully reviewed. Arrangements involving:

•   Fixed or guaranteed payments;

•   Strict scheduling requirements; and

•   Integration into organizational hierarchies

may be vulnerable to recharacterization as employment relationships.

Hybrid models, common in practice, present the greatest risk, particularly where contractual independence is not reflected in day-to-day operations.

Key Takeaways

•   Substance prevails over form : Courts and the Revenue Department will look beyond contractual labels to the actual working relationship.

•   Professional status is not decisive : Although medicine is a liberal profession, not all physicians earn income under Section 40 (6).

•   Control is a key indicator : Fixed hours, supervision, and integration into hospital management point toward Section 40 (1).

•   Payment structure matters : Fixed remuneration suggests employment, while case-based or revenue-sharing arrangements support Section 40 (6).

•   Economic risk is relevant : Variable income linked to performance with indicative of independent professional activity.

•   Alignment is essential: Contracts, payment terms and actual practices must be consistent to withstand scrutiny.

Author: Panisa Suwanmatajarn, Managing Partner.

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Labor: The Case of Continuous Employment After Retirement – A Landmark Ruling on Severance Pay Continuity

In Thailand, it is a common practice for employees to reach the mandatory retirement age stipulated in company regulations, receive severance compensation as required by law, and then be rehired by the same employer under a new employment contract. This approach treats the post-retirement period as entirely separate employment, effectively resetting the length of service for future severance calculations. However, a recent Supreme Court decision has clarified that this outcome is not automatic and depends on the specific circumstances, intentions, and conduct of the parties involved.

Background of the Case:

The dispute originated from an employee who began working in 2010 in the position of financial controller. According to the company’s employee handbook, the retirement age was set at 55 years, which the employee reached in 2017. Rather than terminating the employment and paying severance at that time, both the employer and the employee mutually agreed to continue the working relationship without any severance payment being made upon reaching retirement age. The employee continued performing the same duties and receiving regular wages as before.

This arrangement persisted until 2020, when the employer decided to terminate the employment, citing retirement age as the reason, and paid severance based on the continuous service period from 2010 to 2020. The employee contested this, arguing that the original contract had ended upon reaching age 55 in 2017, constituting a termination that should have triggered severance pay at that point. Consequently, the post-2017 employment should be regarded as a new contract, entitling the employee to a second severance payment (a “double” compensation claim) upon the 2020 termination.

The case progressed through the courts. The Appellate Court for Specialized Cases sided with the employee, viewing the continuation as a new contract and requiring additional severance for the post-retirement period. The employer appealed to the Supreme Court.

Applicable Law:

The primary legal framework is the Labor Protection Act B.E. 2541 (1998), as amended, particularly Section 118, which mandates severance pay upon termination by the employer (absent exceptions), with the amount scaled according to length of service (e.g., 30 days’ wages for 120 days to less than 1 year, up to 400 days for 20 years or more).

Section 118/1 specifically addresses retirement: Retirement at an age agreed upon by the parties or stipulated by the employer is deemed a termination under Section 118, paragraph 2, obligating severance payment unless otherwise provided. If no retirement age is set or it exceeds 60 years, employees aged 60 or older may elect to retire by notifying the employer, with 30 days’ notice, and receive severance.

The key interpretive issue concerns whether reaching the retirement age automatically terminates the contract or if continuation without severance payment indicates an extension of the original contract.

The Supreme Court’s Decision:

In Supreme Court Judgment No. 3114/2567, the Court overturned the Appellate Court’s ruling. It held that the employment contract did not terminate in 2017. The decisive factors included:

•  The employee handbook explicitly permitted the company to extend the retirement age on a case-by-case basis.

•  No severance was paid at age 55, and the employee continued working seamlessly with regular wages and duties.

•  The parties’ conduct demonstrated an intention to extend the existing contract rather than conclude the original one and commence a new one.

The court emphasized that termination due to retirement under Section 118/1 occurs only when the employer ceases to allow continued work and does not pay wages. Absent such actions—particularly where no severance is paid at the retirement point—the contractual relationship persists as a continuous extension.

Consequently, the length of service must be calculated as a single, unbroken period from the initial start date (2010) to the actual termination date (2020). The employer was not required to pay “double” severance; the single payment made in 2020, based on the full continuous service, satisfied the legal obligation.

Key Takeaways:

This ruling establishes an important precedent emphasizing the significance of parties’ intentions and actual conduct over formalistic interpretations:

•  For employers and HR professionals: Clearly stipulate provisions for extending retirement age in employee handbooks or regulations. To reset service length post-retirement, pay full severance at the retirement point and execute a distinct new contract with explicit terms indicating a fresh employment relationship.

•  For employees: Continuous service without severance at retirement can benefit long-term accumulation toward higher severance tiers (up to 400 days’ wages), though it defers immediate payout. Employees should review company policies and seek clarification on contract status upon reaching retirement age.

•  Overall: Judicial decisions in labor cases prioritize the substance of the relationship—evidenced by ongoing work, wages, and absence of severance—over mere labels, ensuring fairness while aligning with statutory protections.

This decision promotes clarity in employment practices and reduces disputes by underscoring the need for transparent agreements regarding retirement and continuation.

Author: Panisa Suwanmatajarn, Managing Partner.

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IP: Strengthens Intellectual Property Governance Through Reform of the National IP Policy Committee

On 17 March 2026, the Thai Cabinet approved in principle a draft amendment to the Regulation of the Office of the Prime Minister on the National Intellectual Property Policy Committee (No. ..) B.E. .…, as proposed by the Ministry of Commerce. This reform constitutes a measured and forward-looking step to modernize Thailand’s intellectual property (“IP”) governance architecture and to position IP more centrally as a driver of long-term economic competitiveness and innovation-led growth.

The amendment principally revises the composition of the National Intellectual Property Policy Committee (the “IP Policy Committee”), which is chaired by the Prime Minister. The updated membership structure integrates representatives from newly restructured government agencies and introduces, for the first time, senior leaders from prominent private-sector organizations. These changes aim to deepen public–private coordination and to ensure that national IP policy more closely reflects contemporary economic realities and commercialization realities.

Historical Development of the Framework:

The IP Policy Committee was formally established in 2011 (B.E. 2554), with the original Regulation taking effect on 2 September 2012 (B.E. 2555). The Regulation defined the Committee’s composition (initially comprising the Prime Minister as Chairperson and 23 ex-officio government members), its operational rules, and its core mandate to formulate, coordinate, and oversee national IP policy and strategy.

Previous amendments were incremental:

  • Regulation (No. 2) B.E. 2556 (2013) adjusted membership and added procedural rules for meetings in the Chairperson’s absence.
  • Regulation (No. 3) B.E. 2559 (2016) further refined the composition without altering the Committee’s fundamental powers or structure.

The 2026 amendment departs from this pattern by introducing more substantial changes designed to align the Committee with Thailand’s current administrative organization and strategic economic priorities.

Principal Revisions to Committee Composition:

  1. Update of Existing Government Positions (3 positions)
The following reflect current ministerial and institutional nomenclature:
  • Permanent Secretary of the Ministry of Higher Education, Science, Research and Innovation
  •  Permanent Secretary of the Ministry of Digital Economy and Society
  •  Director of the National Higher Education, Science, Research and Innovation Policy Council
  1. Addition of Six New Ex-Officio Members
  • Permanent Secretary of the Prime Minister’s Office — to improve whole-of-government coordination of IP policy
  • Permanent Secretary of the Ministry of Tourism and Sports — to advance IP commercialization in tourism and sports industries
  • Permanent Secretary of the Ministry of Interior — to strengthen promotion and protection of geographical indications (GIs)
  • Chairman of the Federation of Thai Industries — to bring industrial-sector expertise and foster public–private collaboration on industrial property matters
  • Chairman of the Thai Chamber of Commerce — to support Thai businesses in extracting greater economic value from IP assets
  • Director of the National Innovation Agency (Public Organization) — to promote innovation policy alignment and execution

As a consequence, the number of ex-officio members rises from 18 to 24.

Anticipated Institutional and Economic Benefits:

The revised structure is expected to deliver several concrete improvements:

  • Strengthened public–private dialogue, enabling policies to better address real-world business needs and commercialization barriers
  • Reduced inter-agency fragmentation through broader and more balanced representation
  • More coherent and expedited decision-making and policy implementation
  • Closer integration of IP strategy with national priorities in innovation, digital economy, tourism, regional development, and industrial competitiveness

While the larger membership enhances inclusiveness, it also necessitates clear internal governance procedures to preserve operational efficiency.

Key Takeaways:

  • The 2026 amendment marks a significant evolution in Thailand’s IP governance, moving beyond minor compositional tweaks to embed meaningful private-sector participation.
  • By expanding the IP Policy Committee to include leaders from industry associations and innovation agencies, Thailand seeks to create a more collaborative, responsive, and commercially oriented IP ecosystem.
  • The reform aligns national IP policy more closely with broader economic development objectives, particularly in innovation-driven growth and value creation from intellectual assets.
  • Successful implementation will depend on effective coordination mechanisms to manage the enlarged Committee without compromising decisional speed or clarity.
  • Overall, the measure reflects a deliberate policy commitment to elevate intellectual property as a strategic pillar of Thailand’s future economic competitiveness.

Author: Panisa Suwanmatajarn, Managing Partner.

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IP Enforcement in Thailand: Strengthened Multi-Agency Operations and Significant Results in 2025–2026

Thailand has significantly advanced its intellectual property (“IP”) enforcement framework through coordinated efforts led by the Department of Intellectual Property (“DIP”), in close collaboration with the Economic Crime Suppression Division (“ECD”) of the Royal Thai Police, the Customs Department, the Department of Special Investigation (“DSI”), and private-sector IP rights holders. These joint initiatives target counterfeit and infringing goods across physical retail locations, storage facilities, border checkpoints, and online marketplaces, with the dual objectives of disrupting illicit supply chains and protecting both consumer safety and legitimate commercial interests.

Enforcement Outcomes in 2025:

Between January and November 2025, integrated operations produced the following results:

  • 1,132 cases of IP infringement
  • 3,344,841 infringing items seized
  • Estimated economic damages exceeding THB 1.14 billion

Compared with the equivalent period in 2024, the number of cases decreased by 16.15%, while the volume of seized items rose by 21.35% and the value of damages increased by 63.89%. This shift indicates greater focus on high-impact interventions and upstream disruption. Contributions by agency were as follows:

  • ECD: 789 cases, 1,820,574 items seized
  • Customs Department: 336 cases, 571,675 items seized
  • DSI: 7 cases, 952,592 items seized

The DIP structured its enforcement activities through three dedicated task forces:

  • Mobile Patrol Units conducting frequent inspections (at least three days per week) in key Bangkok commercial districts, including MBK Center, Platinum Fashion Mall, Pratunam, Sampheng, Silom, Phrom Phong, and Sukhumvit.
  • Regional Task Forces performing bi-weekly operations in provincial high-risk zones, particularly tourist destinations, wholesale markets, and distribution warehouses.
  • Inspection and Evaluation Units carrying out monthly reviews in designated “red-zone” tourist provinces: Bangkok, Chonburi, Chiang Mai, Phuket, Surat Thani (Koh Samui), Songkhla, Krabi, and Prachuap Khiri Khan.

Key Enforcement Actions in Early 2026:

Enforcement momentum continued into 2026 with intensified targeted operations.

  • DIP and ECD Operations (15–31 January 2026): Thirty-two joint actions across Bangkok shopping malls, retail outlets, and northern and eastern provincial markets resulted in the seizure of 11,802 infringing items (estimated damages over THB 14.9 million) and the arrest of 25 individuals. Seized products included counterfeit footwear, apparel, bags, perfumes, and accessories bearing trademarks of Chanel, Louis Vuitton, Gucci, Adidas, Nike, and others. A notable warehouse raid in Samut Sakhon Province on 30 January 2026 recovered 223,404 items valued at more than THB 63.2 million in damages, consisting primarily of substandard consumer goods (shampoo, body lotion, facial cream, toothpaste, and motorcycle spark plugs) that present potential health and safety risks.
  • Border Enforcement with the Customs Department (13 January–6 February 2026): Inspections at Laem Chabang Port, Bangkok Port, Si Racha Free Zone, and Aranyaprathet Customs House led to the interception of 42,451 infringing items (estimated damages THB 223.21 million). Goods included counterfeit luxury bags, shoes, watches, perfumes, automotive components, and solar lamps. For fiscal year 2026 up to 6 February, Customs reported 38 cases with total damages exceeding THB 885 million.
  • Online Platform Measures: Pursuant to Memoranda of Understanding with major e-commerce platforms (Lazada, Shopee, TikTok Shop, NocNoc, and Nex Gen Commerce), authorities secured the removal of 2,867 infringing product listings. Efforts are underway to extend similar arrangements to additional providers.

Strategic Direction:

The Intellectual Property Development Plan B.E. 2569–2570 (2026–2027) coordinates more than 30 government agencies to implement sustained, proactive suppression measures. Core elements include targeting upstream manufacturers and distributors, leveraging ancillary legislation (anti-money laundering, taxation, immigration), expanding online enforcement partnerships, holding property owners accountable for tenant infringements, addressing software piracy, and deploying technology to monitor digital infringement channels.

Key Takeaways:

Ongoing multi-stakeholder cooperation, including public reporting through hotline 1368 or www.ipthailand.go.th, will be essential to sustaining progress, enhancing investor confidence, and supporting long-term economic development.

Thailand’s IP enforcement has become markedly more effective, evidenced by higher seizure volumes and damage valuations despite fewer reported cases, reflecting a strategic emphasis on quality over quantity of interventions.

Operations now systematically address the entire supply chain—from importation and warehousing to retail and online distribution—thereby reducing the availability of counterfeit products.

Consumer protection remains central, with authorities repeatedly highlighting the health and safety hazards posed by unregulated, substandard goods.

Rights holders and businesses operating in Thailand are advised to maintain rigorous supply-chain oversight, secure appropriate authorizations, and proactively protect their intellectual property to minimize exposure to enforcement action.

Author: Panisa Suwanmatajarn, Managing Partner.

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International Trade: Updates to Thailand’s Certificate of Origin Issuance under TCFTA and AKFTA

The Department of Foreign Trade (DFT) of Thailand has prepared draft notifications to revise the rules, procedures, and conditions for issuing preferential Certificates of Origin under two significant Free Trade Agreements (FTAs). These amendments primarily align the Product Specific Rules (PSRs) with the Harmonized System (HS) 2022 tariff classification, thereby preserving the eligibility of qualifying Thai-origin goods for reduced or exempted customs duties in the respective markets.

1.  Thailand-Chile Free Trade Agreement (TCFTA)
The draft notification governs the issuance of Form TC for goods exported from Thailand to Chile (or vice versa, where applicable). It updates procedures to reflect the transition of PSRs from HS 2012 to HS 2022, following formal decisions by the Thailand-Chile Free Trade Commission, Cabinet approval, and completion of diplomatic note exchanges in late 2025.
Principal features include:

       •  Electronic application submission via the DFT system or authorised agencies.

       •  Mandatory supporting documents: commercial invoice, transport document (e.g., Bill of Lading or Air Waybill), and origin qualification evidence, differentiated for agricultural and industrial products.

       •  Indication of origin criteria in Box 8 (e.g., WO, PE, CC, CTH, CTSH, QVC, SP).

       •  Validity period of 12 months from the date of issuance.

       •  Special provisions covering retroactive issuance (within 1 year, marked “Issued Retroactively”), non-party invoicing, de minimis deviations (DMI ≤10% FOB), accumulation (ACU), exhibition goods, corrections, and replacements.

       •  Retention of supporting documents for 5 years.
The notification is scheduled to enter into force on 1 April 2026, replacing the existing notification dated 2015.

2.  ASEAN-Korea Free Trade Agreement (AKFTA)
The draft notification pertains to the issuance of Form AK for goods originating in Thailand and exported to the Republic of Korea or other AKFTA member countries. It updates PSRs from HS 2017 to HS 2022, in accordance with joint decisions of relevant ASEAN-Korea sub-committees in mid-2025.
Principal features include:

       •  Electronic submission through the DFT system.

       •  Documentation requirements aligned with those under TCFTA, with specific procedures for agricultural goods (HS Chapters 01–24) and industrial goods (HS Chapters 25–97).

       •  Origin criteria to be indicated in Box 8 (e.g., WO, CTH, RVC 40%, CTC, WO-AK, RVC with actual percentage, CTH+RVC, Specific Processes).

       •  Validity period of 12 months.

       •  Mechanisms for retroactive applications (within 1 year, marked “ISSUED RETROACTIVELY”), back-to-back certification, exhibition goods, third-country invoicing, and replacements (marked “CERTIFIED TRUE COPY”).

       •  Retention of supporting documents for at least 3 years.
The notification is expected to take effect on 1 May 2026, superseding the 2015 notification.

Possible Public Impact:

These revisions are anticipated to deliver net positive outcomes for Thai exporters by ensuring continued and accurate access to preferential tariff treatment under TCFTA and AKFTA, thereby preserving cost competitiveness in the Chilean and Korean markets. Exporters may encounter short-term transitional requirements, including re-assessment of product HS classifications against the updated PSRs, recalculation of regional value content (where relevant), and verification of supply chain documentation. Any delay in adaptation could temporarily jeopardise eligibility for duty reductions or exemptions on specific shipments. Nevertheless, the sustained use of the DFT’s electronic issuance platform is expected to streamline processing, lower long-term administrative costs, and improve overall trade facilitation.

Key Takeaways:

•  The updates align Thailand’s Certificate of Origin procedures with HS 2022 under TCFTA (effective 1 April 2026) and AKFTA (effective 1 May 2026).

•  Exporters must promptly review and adjust HS classifications, origin calculations, and supporting documentation to maintain preferential tariff benefits.

•  The electronic submission system remains central, supporting greater efficiency and compliance.

•  Proactive preparation is essential to avoid disruptions in claiming duty preferences in Chile and Korea.

Author: Panisa Suwanmatajarn, Managing Partner.

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Thailand Plans to Reform Excise Tax System to Increase Revenue

Excise tax is one of the principal sources of revenue for the Thai Government (“Government”). For fiscal year 2026 (B.E. 2569), the Government has set a target to collect approximately THB 578.2 billion in excise tax revenue.

In the first quarter of fiscal year 2026 (October 2025 – January 2026), excise tax collection was in total amount of THB 191.3 billion, exceeding the Government’s projection by THB 8.3 billion. The higher-than-expected revenue was largely driven by strong domestic consumption and increased spending during the year-end tourism season and the New Year holidays.

To further strengthen fiscal revenue for fiscal year 2026, the Government is considering several reforms to Thailand’s excise tax system.

Plan to Increase Excise Tax Revenue

The Ministry of Finance aims to increase excise tax revenue by approximately 7.6% through several policy measures, including:

  • restructuring the excise tax framework;
  • adjusting tax rates for certain goods and services; and
  • improving tax administration and enforcement.

The Excise Department has conducted policy studies and is expected to submit the proposed reform plan to the Cabinet for consideration soon.

Proposed Reform of Cigarette Excise Tax

Thailand currently applies a two-tier excise tax system for cigarettes, consisting of the following components:

1. Ad Valorem Tax (Based on Retail Price)

  • 25% for cigarettes priced at not more than THB 72 per pack
  • 42% for cigarettes priced above THB 72 per pack

2. Specific Tax (Based on Quantity)

  • THB 1.25 per cigarette (approximately THB 25 per pack)

According to studies conducted by the Fiscal Policy Office, the current two-tier system has reduced government revenue because cigarette manufacturers often maintain retail prices below the THB 72 threshold in order to benefit from the lower tax rate.

To address this issue, the Excise Department is considering the introduction of a single-tier tax rate, under which cigarettes would be taxed at the same rate regardless of retail price. This approach is expected to reduce price distortions and improve tax collection efficiency.

The Excise Department has requested legal clarification from the Council of State regarding whether the proposed tax structure can be implemented. Further progress will likely depend on the policy direction of the new government.

Automobile Excise Tax Changes

The Government has revised the automobile excise tax framework, with tax rates varying depending on the type of vehicle and its environmental performance. The new tax structure came into effect on 1 January 2026.

Under the revised framework, the excise tax rate is determined primarily based on carbon dioxide (“CO₂”) emission levels, replacing the previous approach that focused mainly on engine displacement (cc). As a result, certain vehicle categories are now subject to higher tax rates compared with those applied in 2025.

Key changes include:

  • Internal combustion engine vehicles (“ICE”) with CO₂ emissions of 100 g/km: the tax rate increased from 12% to 13%.
  • ICE vehicles with engines exceeding 3.0 liters, such as luxury cars and supercars: the tax rate increased from 40% to 50%.
  • Hybrid electric vehicles (“HEV”) with CO₂ emissions not exceeding 100 g/km: the tax rate increased from 4% to 6%.
  • HEV with CO₂ emissions between 101–120 g/km: the tax rate increased from 8% to 9%.
  • HEV with CO₂ emissions between 121–150 g/km: the tax rate increased from 8% to 14%.
  • Electric pickup trucks, which were previously exempt from excise tax, are now subject to 2% tax rate.

As a result of this policy shift, the excise tax rate for vehicles in the eco-car segment has increased from 12% to approximately 13–34%, depending on emission levels.

The Government also plans to gradually increase automobile excise tax rates in two additional phases, during 2028–2029 and again in 2030, as part of its long-term environmental and fiscal policy.

Automobile excise tax collection in the first quarter of fiscal year 2026 increased partly because manufacturers and consumers accelerated vehicle purchases ahead of the tax increase. Following the implementation of the new tax structure on 1 January 2026, tax revenue from automobiles is expected to increase further in the remaining quarters of fiscal year 2026 due to the higher tax rates introduced under the revised framework.

Other Potential Excise Tax Measures

In addition to the proposed reforms to cigarette excise tax and automobile taxation, the Excise Department is also considering further adjustments to excise taxes on several categories of goods and services. However, the specific criteria and potential tax rate changes have not yet been clearly determined.

These potential measures may include:

  • restructuring excise taxes on petroleum and petroleum products;
  • increasing excise tax rates on sin goods, such as alcohol and beer;
  • introducing taxes on products harmful to health, such as a potential salt tax;
  • imposing taxes on environmentally harmful goods, including possible battery or carbon taxes; and
  • reviewing the taxation of luxury goods and services.

Conclusion

Thailand is considering several reforms to its excise tax system in order to strengthen government revenue and improve tax collection efficiency. Key measures include the potential introduction of a single-tier cigarette tax, revisions to the automobile excise tax framework based on vehicle type and CO₂ emissions, and possible adjustments to taxes on petroleum products, alcohol, health-related products, environmentally harmful goods, and luxury goods and services.

These reforms aim not only to increase government revenue but also to support broader policy objectives, such as promoting environmentally friendly vehicles and reducing harmful consumption. However, higher excise tax rates may also increase costs for businesses and retail prices for consumers.

With the revised automobile tax framework already taking effect on 1 January 2026, together with other proposed measures currently under consideration, excise tax revenue is expected to continue increasing throughout fiscal year 2026. Businesses operating in industries subject to excise tax should closely monitor future policy developments, as upcoming regulatory changes may significantly affect tax costs and compliance obligations in Thailand.

Author: Panisa Suwanmatajarn, Managing Partner.

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U.S. Tariff Policy Shift Following Supreme Court Ruling: Thailand Monitors Impact and Prepares Strategic Response

U.S. Supreme Court Limits Presidential Authority to Impose Global Tariffs

On 20 February 2026, the Supreme Court of the United States issued a significant ruling in Learning Resources, Inc. v. Trump by a 6–3 majority. The Court held that the International Emergency Economic Powers Act (IEEPA) does not authorize the U.S. President to impose broad global import tariffs.

The Court reasoned that the imposition of tariffs constitutes a fiscal power that is constitutionally vested in the United States Congress rather than the executive branch.

As a consequence, the Court invalidated the Reciprocal Tariff measure previously implemented under IEEPA. The decision could potentially result in the refund of tariffs already collected, estimated at approximately USD 175 billion.

U.S. Introduces Temporary Global Tariff under Trade Act of 1974

Following the ruling, the U.S. President issued a proclamation on the same day invoking authority under Section 122 of the Trade Act of 1974 to impose a temporary import surcharge of 10% on goods imported from all countries for a period of 150 days, citing concerns related to balance-of-payments pressures.

The measure took effect on 24 February 2026. However, on 21 February 2026, the President announced an increase in the tariff rate to 15%, the maximum level permitted under Section 122, effective immediately.

This temporary tariff measure replaces the Reciprocal Tariff framework but includes exemptions for certain strategic goods, including:

  • Certain critical minerals
  • Metals used in currency and bullion
  • Energy and energy products
  • Certain agricultural products
  • Pharmaceuticals and pharmaceutical ingredients
  • Certain electronics
  • Passenger vehicles, certain light trucks, medium- and heavy-duty vehicles, buses, and related parts
  • Certain aerospace products

Potential Impact on Thailand

The Vice Chairman of the Thai Chamber of Commerce stated that the U.S. court decision does not disrupt the ongoing trade negotiations between Thailand and the United States. Instead, the ruling provides greater legal clarity regarding U.S. trade policy.

From a commercial perspective, the new tariff rate of 15% is lower than the effective tariff rate of approximately 19% previously faced by Thai exports. Consequently, the short-term impact on Thai exporters is expected to be manageable.

In addition, the temporary nature of the measure may create short-term export opportunities, as U.S. importers may accelerate purchases during the 150-day implementation period in anticipation of potential policy changes.

Nevertheless, Thailand may still need to address longstanding U.S. concerns in several areas, including:

  • Production cost structures
  • Government subsidies
  • Anti-dumping issues
  • Labour standards
  • Environmental standards
  • Food safety regulations
  • Intellectual property protection

These issues may become increasingly relevant in the context of future trade policy reviews.

Thai Government Response

The Prime Minister has instructed the Thailand–U.S. trade negotiation team, including the Deputy Prime Minister and Minister of Finance, together with the Minister of Commerce, to closely monitor developments following the transition from the Reciprocal Tariff framework to the 15% global tariff measure.

While the reduced tariff rate may provide short-term benefits for Thai exports, policymakers recognize the possibility of further U.S. trade measures and will continue to maintain close bilateral engagement.

Thailand’s Strategic Response

To mitigate potential risks and strengthen economic resilience, Thailand is pursuing several strategic initiatives.

1. Continued Engagement with U.S. Trade Authorities

Thailand will continue discussions with the Office of the United States Trade Representative (USTR) to safeguard Thai export interests and manage potential tariff risks.

2. Expansion of Free Trade Agreements (FTAs)

The government is accelerating negotiations on free trade agreements in order to diversify export markets and reinforce Thailand’s position as a regional trade and investment hub.

Current priorities include:

  • Implementation of FTAs with Sri Lanka and the European Free Trade Association (EFTA), which have already been signed and are awaiting domestic approval
  • Targeting the conclusion of FTA negotiations with South Korea and the European Union by 2026
  • Advancing trade cooperation between the Association of Southeast Asian Nations (ASEAN) and Canada

3. Support Measures for Businesses

The Ministry of Commerce has established a consultation centre to provide guidance to businesses affected by evolving global trade policies.

4. Investment Promotion and Supply Chain Relocation

Thailand is also working to remove regulatory barriers to investment in order to attract supply-chain relocation into Thailand and the broader ASEAN region.

The Prime Minister has tasked the Office of the Council of State of Thailand with accelerating legal reforms affecting investors, while the Thailand Board of Investment continues to expedite investment approvals under the Board of Investment (BOI) Fast Pass policy.

Author: Panisa Suwanmatajarn, Managing Partner.

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Partnerships and Limited Companies: Enhanced Measures to Prevent Nominee Arrangements Involving Foreigners

The Department of Business Development (DBD) has identified more than 75,000 companies operating in Thailand with foreign shareholders holding less than 50 percent of shares while engaging in restricted businesses under the schedules of the Foreign Business Act B.E. 2542 (1999) (“FBA”). Such structures may indicate the use of Thai nationals as nominees to conceal foreign ownership or control.

To strengthen the prevention of these arrangements, the DBD proposes the Draft Central Partnership and Company Registration Office Order No. .. / 2569 on Criteria and Procedures for Registration of Amendments to Include a Foreigner as a Partner of a Partnership or as an Authorized Signatory of a Limited Company (the “Draft Order”).

The Draft Order aims to prevent Thai nationals from providing assistance, support, or joint participation in business operations with foreign investors in a nominee capacity, which may constitute an offense under section 36 of the FBA.

Key Provisions of the Draft Order:

The Draft Order introduces mandatory in-person verification procedures for specific post-incorporation amendments to registered partnerships and limited companies, supplementing existing controls (such as three-month bank statement requirements for initial registrations involving foreign elements).

1.  Amendments to Partners of Registered Partnerships: For amendments to a registered partnership that originally had all Thai-national partners or previously had foreign partners contributing 50 percent or more of the capital, where the proposed change results in foreign partners collectively holding less than 50 percent of the capital, the Registrar requires:

      •  All existing partners and incoming Thai-national partners to appear in person before the Registrar.

      •  Presentation of valid national identification cards or equivalent photographic identification documents (unexpired).

      •  Recording of formal sworn statements confirming relevant details and denying nominee conduct.

2.  Amendments to Limited Companies: The Draft Order applies to limited companies where all existing authorized directors (with the power to bind the company) are Thai nationals. If an amendment seeks to appoint new directors, change the number or names of authorized directors, or otherwise result in a foreigner becoming an authorized director or co-signatory with binding authority, the Registrar requires:

      •  All existing directors and incoming Thai-national directors to appear in person.

      •  Presentation of valid identification as above.

      •  Recording of formal sworn statements affirming genuine participation and denying nominee arrangements.

3.  Exceptions to the Procedure:
In cases where full compliance is not feasible, the registration application may be accepted upon demonstration of reasonable grounds and receipt of written approval from designated senior officials, including the Head of the Business Registration and Trade Facilitation Group, the Director of the Central Business Registration Division, the Director of the Digital Juristic Person Registration System Promotion and Development Division, or the Director of a relevant Department of Business Development District Office.

Public Consultation and Expected Implementation:

The Draft Order is currently undergoing public consultation, commencing on 29 February 2026 and concluding on 13 March 2026. Following the consultation, submitted feedback will be reviewed, potential revisions made, and the order advanced toward finalization and promulgation. If adopted in its current or a similar form, implementation is tentatively anticipated around early April 2026 or shortly thereafter, subject to official confirmation.

Businesses and Individuals Potentially Affected:

The Draft Order may impact:

  • Limited companies and registered partnerships in Thailand.
  • Thai-national directors, partners, and incoming participants in relevant amendments.
  • Foreign investors or directors seeking involvement through shareholding below 50 percent or signatory authority.
  • Legal practitioners, corporate service providers, and other parties facilitating business registrations.
  • Entities with foreign investment or managerial involvement, particularly in restricted sectors, should review their structures and monitor developments to ensure future compliance.

Conclusion:

The Draft Order represents a targeted extension of the DBD’s intensified efforts to enforce foreign business restrictions and combat nominee practices. By requiring direct verification and sworn declarations from Thai participants. It aims to promote greater transparency and deter circumvention of the FBA. This measure complements—not replaces—prior registration safeguards and aligns with broader regulatory initiatives against illicit nominee structures observed since early 2026.

Stakeholders are advised to consult and seek professional legal advice to prepare for potential requirements once the Draft Order is finalized.

Author: Panisa Suwanmatajarn, Managing Partner.

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