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Foreign Geographical Indication Registration in Thailand

Overview of Geographical Indications

A Geographical Indication (GI) is a distinctive mark used for products originating from a specific geographical area, where the quality, reputation, or other characteristics of the products are essentially attributable to their geographical origin. It serves as a local brand that signifies both the quality and origin of products. GI marks can be registered regardless of whether they originate from Thailand or abroad by filing the applications with the Department of Intellectual Property (DIP).

To register Thai GI marks, applicants must use a proper name, symbol, and/or sign that identifies their geographical origin. It cannot be just a generic name of the goods. It is required to demonstrably establish a connection between the products and their geographical origin and ensure compliance with public interest, while also ensuring that they do not contravene public order, good morals, or public policy.

For the overseas applicants registering GI marks originating from abroad, it is required to show clear evidence that such marks are protected under the GI law of those countries, and the GI marks registered in those countries have been in continuous use up to the date of application for registration in Thailand.

Registering the GI marks grants the community exclusive rights to their names, enhances the products’ market value, ensures compliance with quality standards, and preserves unique local heritage. Currently, there are 257 registered GI marks, comprising 234 Thai GI products from all 77 provinces of Thailand and 23 foreign GI marks from 9 countries.

basket of mangosteen

International Agreement Context

Thailand and the European Union (EU) are currently negotiating a Free Trade Agreement (FTA), with the aim of concluding the negotiations by 2025. One of the EU’s key requirements is the protection of GI through the exchange of GI lists under the FTA.

Currently, there is no specific legislative provision in Thailand that governs the exchange of GI lists under international agreements. Accordingly, it is necessary to establish specific rules and procedures regarding the registration of foreign GI marks under such agreements. The government has therefore issued the Draft Ministerial Regulation on the Application for Registration of Foreign Geographical Indications under International Agreements B.E. …. (“Ministerial Regulation”), which sets out the criteria, application procedures, and examination processes for the registration of foreign GI marks under international agreements.

Key Features of the Draft Ministerial Regulation

Scope of Applications

This draft Ministerial Regulation is intended to facilitate the registration of foreign GI marks through the exchange of GI lists between Thailand and its negotiating partners.

Date of Protection

Foreign GI marks shall be protected in Thailand once the relevant provisions of the international agreements with Thailand have entered into force.

The Director-General of the DIP shall have the authority to announce, on a case-by-case basis, the date on which the provisions of such international agreements with Thailand will take effect.

Consequences of Unsuccessful Negotiations

In the event that negotiations for an international agreement fail to reach a conclusion, any pending applications for registration shall be deemed automatically withdrawn. Please see details of the draft Ministerial Regulation in our previously published article here [ใส่ลิงค์]

Eligible Applicants

Under the draft Ministerial Regulation, it is designed for the State or government agencies of the contracting party. Natural persons or private legal entities are not permitted to file applications under this Ministerial Regulation. They are required to obtain their GI mark protection through the general registration process.

Procedures for Foreign GI Registration

Although foreign GI marks can be protected in Thailand through the exchange list under the relevant international agreement, the protected right shall not be automatically granted. The registration processes under the draft Ministerial Regulation, as well as those prescribed under the Geographical Indications Protection Act B.E. 2546 (2003), shall still be required (i.e., filing, publication, opposition, counterstatement, registration, and appeal).

Next Steps

The DIP will submit the Draft Ministerial Regulation to the Council of Ministers for subsequent consideration and later publish the same in the Gazette for enforcement.

Author: Panisa Suwanmatajarn, Managing Partner.

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Thai Government Policy Response to Recent U.S. Tariff Measures

Following the United States government’s official announcement imposing a 19% import tariff on Thai goods effective August 1, 2025, the Thai government has developed a comprehensive policy framework to mitigate economic impacts. This multi-pronged approach encompasses financial support mechanisms, fiscal policy adjustments, and targeted business assistance programs designed to maintain Thai export competitiveness in the U.S. market while ensuring economic stability throughout this transition period.

U.S. Trade Policy Changes

General Tariff Implementation

The United States has implemented a 19% import tariff on Thai goods, effective August 1, 2025, representing a significant shift in bilateral trade relations.

Copper Products Tariff Structure

Concurrently, the U.S. has imposed a 50% import tariff on copper products from all countries, effective August 1, 2025. This comprehensive measure applies to:

  • Semi-finished copper products
  • Goods with high copper content
  • Copper pipes, wires, rods, and cables
  • Copper connectors and electronic components

The tariff excludes copper scrap, imported raw copper materials, and refined copper—essential components of the global supply chain. These exemptions have precipitated a significant decline in copper prices, resulting in substantial losses for traders who had accumulated inventory in anticipation of increased demand.

Government Response Measures

Immediate Business Support Initiatives

Tax Relief Programs

  • Strategic tax incentives including deductions and credits
  • Reduced corporate income tax rates
  • Targeted relief measures to facilitate business adaptation during the tariff transition

Soft Loan Program

  • Allocation of a minimum of 200 billion baht through state financial institutions
  • Distribution via commercial banking networks
  • Designed to maintain business liquidity and operational continuity

Government Subsidies

  • Competitiveness enhancement funding administered by the Board of Investment (BOI)
  • Targeted support for strategic industries
  • Focus on maintaining competitive positioning in global markets

Cabinet-Approved Economic Stimulus

The Cabinet has authorized two major stimulus initiatives, totaling 18.5 billion baht, specifically designed to:

  • Strengthen national economic competitiveness
  • Provide enhanced student loan support programs

Institutional Support Framework

Export Support Infrastructure

On August 7, 2025, the Ministry of Commerce established a One-Stop Service Center at the Export Center, providing:

  • Comprehensive consultation services
  • Advisory support for affected businesses
  • Problem-solving assistance for both SMEs and large corporations
  • Export facilitation and promotional activities

EXIM Bank Financial Relief Package

The Export-Import Bank of Thailand has implemented comprehensive financial support measures including:

Liquidity Enhancement Programs:

  • Extended repayment terms up to 365 days to alleviate cash flow pressures
  • Interest rate reductions of up to 20% for existing and new loan facilities
  • Pre and post-export revolving credit facilities providing low-interest working capital

Specialized Financing Solutions:

  • Pre-emptive principal repayment holidays extending up to one year for qualifying long-term borrowers
  • Transformation loans starting at 2.75% interest for production upgrades and automation initiatives
  • Post-shipment working capital loans with export insurance (EXIM Safe Trade) providing protection against buyer default

Market Diversification Support:

  • Trade Fair Participation Loans (EXIM Department of International Trade Promotion Empower Financing) for overseas market exploration
  • SME support loans in partnership with the Social Security Office, starting at 2.00% interest, to maintain employment levels and operational stability

Strategic Outlook

The implementation of restrictive U.S. trade measures presents substantial challenges for Thai export sectors. While the Thai government has initiated comprehensive mitigation strategies, ongoing monitoring and assessment of their effectiveness remains critical. In an increasingly volatile global trade environment, Thailand must maintain agility, proactive policy development, and adaptive capacity to preserve its competitive position in evolving international markets.

The success of these measures will largely depend on their implementation efficiency, private sector engagement, and the ability to identify and capitalize on alternative market opportunities while maintaining strong bilateral relationships with key trading partners.

Author: Panisa Suwanmatajarn, Managing Partner.

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Digital Economy: Government Approves Comprehensive Three-Year Data Strategy and Advances AI and Smart City Initiatives

On August 21, 2025, the National Digital Economy and Society Committee convened to approve a series of transformative resolutions aimed at bolstering digital infrastructure, artificial intelligence (AI) development, and smart city initiatives. These decisions underscore the government’s commitment to fostering economic growth, enhancing national competitiveness, and ensuring a sustainable digital future for all citizens.

National Data Strategy:

The committee approved a three-year National Data Policy and Strategy, designed to provide a robust framework for digital transformation. The strategy focuses on four key pillars:

  • Data Infrastructure: Developing a resilient foundation for managing large-scale datasets to support digital innovation.
  • Data Governance: Establishing clear standards to enhance trust and efficiency in digital services.
  • Data Utilization: Promoting secure and widespread use of data across public and private sectors.
  • Digital Workforce: Cultivating a skilled workforce to meet the demands of the digital economy.

National Artificial Intelligence Committee:

A National AI Committee was established to oversee the implementation of the country’s AI action plan. The committee’s objectives include:

  • Advancing local talent and technological innovation in AI.
  • Leveraging AI to drive economic competitiveness.
  • Utilizing AI to address social and environmental challenges, thereby improving the quality of life.

Smart City Development:

The committee extended Smart City certifications for 16 existing projects and granted a new Smart Area certification to the Phuket Tinicon Valley Project, increasing the total number of certified smart cities to 37 across 25 provinces. Notable projects include Mae Moh Smart Living City (Lampang), Khlong Phadung Krung Kasem (Bangkok), Yala Smart City for Civic Engagement, and Samyan Smart City (Bangkok), each achieving over 80% progress. Since 2021, private sector investment in smart city development has surpassed 30.9 billion baht, driven by tax incentives and public procurement privileges. These initiatives integrate advanced technologies, such as intelligent transportation systems and clean energy management, to enhance urban living standards.

man standing on stairs

Public Internet Network Expansion:

The committee endorsed the management of the National Broadband Network, “Net Pracharat,” under an Open Access Network model. This initiative aims to ensure equitable and universal internet access, particularly in underserved areas. The Office of the National Digital Economy and Society Commission will lead the implementation, focusing on:

  • Economic Empowerment: Enabling citizens in remote areas to access online markets, thereby increasing income opportunities through activities such as selling agricultural products and handicrafts.
  • Cost Reduction: Lowering internet service costs by expanding access through government-supported infrastructure and making digital services more affordable.

Economic and Social Impacts:

The approved initiatives are poised to deliver significant economic and social benefits. The public internet network will bridge the digital divide, fostering economic inclusion and reducing connectivity costs. Smart city developments will enhance urban management, attract private investment, and improve residents’ quality of life through sustainable and innovative solutions.

Key Takeaways:

  • These initiatives reflect a commitment to building a competitive, inclusive, and sustainable digital economy.
  • The three-year National Data Strategy emphasizes data infrastructure, governance, utilization, and workforce development to drive digital transformation.
  • The establishment of a National AI Committee will advance AI innovation, economic growth, and solutions for social and environmental challenges.
  • Smart city certifications have been extended to 16 projects, with a new certification for the Phuket Tinicon Valley Project, contributing to 37 smart cities across 25 provinces.
  • The Open Access Network model for “Net Pracharat” will enhance internet accessibility, reduce costs, and create economic opportunities for citizens.

Author: Panisa Suwanmatajarn, Managing Partner.

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Thailand Labor Landmark Case: Employers Jailed for Unpaid Severance of more than 800 Workers

In August 2025, a pivotal moment in Thailand’s labor rights landscape occurred when the Samut Prakan Provincial Court denied bail to four executives of the company who were immediately imprisoned for unlawfully terminating of  more than 800 employees without paying mandated severance and advance notice compensation. This case marks a rare instance of employers facing immediate incarceration for violating labor laws, reinforcing the judiciary’s commitment to upholding workers’ rights under the Labor Protection Act B.E. 2541 (1998).

Background of the Case:

The dispute originated in November 2024, when the company terminated more than 800 employees without providing severance pay or advance notice payments, as required by Thai labor law. The total amount owed to the employees is approximately 220 million baht (USD 6.2 million). Despite labor inspectors’ orders to compensate the workers, the company’s executives failed to comply, prompting the affected employees, supported by labor advocates, to pursue criminal legal action against the company and executives.

Legal Framework: Labor Protection Act B.E. 2541 (1998):

The court’s ruling is grounded in the Labor Protection Act B.E. 2541 (1998), which outlines key protections for employees:

•  Mandates advance notice of termination and payment in lieu of notice.

•  Requires severance pay for employees terminated without cause, with amounts based on length of service.

•  Imposes penalties, including fines and up to six months’ imprisonment, for employers who fail to comply with severance or other compensation requirements.

The executives’ non-compliance with labor inspectors’ orders and their attempts to delay judicial proceedings justified the court’s decision to deny bail and order immediate detention.

Court Proceedings and Worker Advocacy:

The former employees attended the court’s hearing to oppose the executives’ bail applications, submitting objections citing the financial hardship caused by the employer’s actions and their defiance of legal orders. The court’s denial of bail and immediate imprisonment of the executives is an uncommon outcome in Thailand, where labor disputes often result in prolonged negotiations or unenforced rulings. The workers’ eight-month struggle involved repeated appeals to government bodies, including the Ministry of Labor, police, and public prosecutors, showcasing the power of collective action.

Broader Implications for Thai Labor Rights:

This case sets a significant precedent for Thailand’s labor movement, demonstrating that persistent advocacy can lead to criminal accountability for employers. Enforcement of labor laws in Thailand has historically been inconsistent, with many employers evading penalties. This case signals that violations of the Labor Protection Act B.E. 2541 (1998) can result in severe consequences, potentially deterring future non-compliance. However, the affected workers still await their 220 million baht in compensation, and the Ministry of Labor’s silence on this and similar cases involving over 43,000 workers nationwide highlights the need for stronger enforcement and systemic reforms.

Key Takeaways:

1.  Judicial Accountability: The court ruling upholds the Labor Protection Act B.E. 2541 (1998), affirming the judiciary’s role in protecting workers’ rights.

2.  Power of Collective Action: The workers’ eight-month campaign through protests and legal advocacy illustrates the impact of organized labor in achieving justice, despite limited union protections.

3.  Ongoing Challenges: The workers have yet to receive their 220 million baht in compensation, underscoring gaps in enforcement and the need for government intervention.

4.  Precedent for Employers: The imprisonment of the executives serves as a deterrent, warning employers of criminal penalties for labor law violations.

5.  Call for Reform: The case highlights systemic issues, including the Ministry of Labor’s inaction and weak unionization laws, necessitating reforms to strengthen labor protections.

This landmark ruling not only delivers justice for more than 800 affected workers but also galvanizes Thailand’s labor movement, proving that collective action can challenge systemic inequities.

Author: Panisa Suwanmatajarn, Managing Partner.

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The Ripple Effect EP. 10: Thailand–U.S. Tariff Agreement: Navigating the Reduction from 36% to 19%

Following intensive diplomatic negotiations, Thailand has successfully secured a substantial reduction in U.S. import tariffs from 36% to 19%, effective August 1, 2025. This agreement represents a significant diplomatic and economic achievement that will enhance Thailand’s export competitiveness and strengthen bilateral trade relations.

Background of Thailand–U.S. Tariff Negotiations

On July 7, 2025, the United States government formally notified Thailand of its intention to impose a 36% tariff on Thai imports, scheduled to take effect on August 1, 2025. This proposed tariff threatened to significantly impact Thailand’s international trade sector and prompted immediate diplomatic action.

The Thai government responded swiftly by initiating comprehensive diplomatic engagement with U.S. authorities to seek reconsideration and reduction of the proposed tariff rates. On July 17, 2025, the Minister of Finance formally commenced trade negotiations with the Office of the United States Trade Representative (USTR) by submitting a comprehensive revised trade package. This proposal included:

  • Reciprocal tariff reductions on various U.S. goods
  • Expanded market access for U.S. products
  • Enhanced investment opportunities for U.S. companies in Thailand

Following the USTR’s feedback and additional queries, Thailand refined its proposal through multiple iterations. On July 23, 2025, Thailand submitted its final trade proposal to the USTR, representing the culmination of intensive negotiations during which Thailand had already presented over 90% of its revised trade offers.

The final phase of negotiations occurred on July 29, 2025, when the Minister of Finance and the Thai delegation conducted another round of high-level discussions with the USTR. During this meeting, the USTR presented a final draft document for submission to the U.S. President, which the Thai delegation reviewed and returned, marking one of the final procedural steps before the formal presidential announcement.

Negotiation Outcome

On July 31, 2025, the White House officially announced through its website that Thailand had successfully negotiated a reciprocal tariff agreement with the United States, achieving a significant reduction in import duties on Thai goods from 36% to 19%.

aerial view of containers and machinery in a port

Key Implementation Details

  • Effective Date: The new 19% tariff rate takes effect on August 1, 2025
  • Transition Period: Shipments currently in transit will remain subject to the existing 10% tariff rate
  • Full Implementation: The new tariff structure will be fully operational by August 7, 2025
  • Enforcement Measures: Goods involved in transshipment or tariff evasion will face a penalty rate of 40%

This reduction is expected to significantly enhance Thailand’s competitiveness in the U.S. market while bolstering investor confidence in Thailand’s economic prospects.

Strategic Government Support

1. Financial Support Mechanisms for Entrepreneurs

The Thai government has developed targeted support measures for domestic entrepreneurs affected by the evolving U.S. tariff environment:

Soft Loan Program: Implementation of low-interest loan facilities designed to enhance liquidity for affected businesses and maintain operational continuity.

Capital Enhancement Fund: Establishment of a dedicated THB 10 billion fund to strengthen business capabilities and competitiveness. The Federation of Thai Industries and the Thai Chamber of Commerce have been designated as implementing partners responsible for:

  • Data collection and entrepreneur classification
  • Facilitating machinery modernization initiatives
  • Supporting production efficiency improvements

2. Economic Restructuring and Investment Enhancement

The government has committed to comprehensive economic reform aimed at increasing domestic investment from the current average of 20% to 35% of GDP. Key strategic elements include:

Short-term Objectives:

  • Maintaining economic growth rate targets of 3% for the second quarter
  • Managing transition challenges while preserving economic stability

Long-term Vision:

  • Adoption of advanced technologies to address structural investment constraints
  • Systematic removal of barriers that have historically limited investment growth
  • Achievement of sustained investment levels between 30-35% of GDP to ensure long-term economic stability

Conclusion and Outlook

The successful reduction of U.S. tariffs on Thai goods from 36% to 19% demonstrates Thailand’s diplomatic effectiveness and commitment to strengthening bilateral trade relations. This achievement will deliver tangible benefits including:

  • Reduced export costs for Thai manufacturers
  • Expanded market access opportunities in the U.S.
  • Enhanced competitive positioning for Thai products
  • Increased investor confidence in Thailand’s economic resilience

The agreement positions Thailand favorably for sustained export growth while reinforcing its status as a reliable trading partner. Moving forward, continued monitoring of policy implementation and adaptive measures will be essential to maximize the benefits of this tariff reduction and maintain Thailand’s competitive advantage in the evolving global trade environment.

Author: Panisa Suwanmatajarn, Managing Partner.

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The Ripple Effect EP. 9: Navigating Tariffs and Technology Controls: Thailand’s Strategic Response to U.S. Trade Pressures

Thailand is currently navigating a rapidly evolving trade landscape marked by two significant challenges. Firstly, the United States set to increase tariffs on selected Thai exports to 36%, effective on August 1, 2025. Secondly, the U.S. Department of Commerce is reportedly considering stricter export controls on high-performance NVIDIA AI chips destined for particular countries, including Thailand, citing concerns about potential transshipment to China. These developments could have substantial implications for Thailand’s trade relations and regulatory compliance framework.

In response, the Thai government has implemented swift and strategic measures, including initiating diplomatic engagements with U.S. counterparts, implementing targeted investment promotion strategies, and enhancing oversight of advanced technologies to ensure compliance with international trade regulations.

Trade Negotiations and Economic Safeguards

The Finance Minister has proposed offering tariff exemptions on selected U.S. imports as leverage to negotiate the reduction of retaliatory tariffs from 36% to levels comparable to those imposed on Vietnam and Indonesia—approximately 20%.

1. Selective Market Opening

Thailand is prepared to reduce tariffs—potentially to 0%—on U.S. goods that the country does not produce or cannot produce in sufficient quantities, such as specific agricultural or industrial products. However, this market access must not conflict with Thailand’s commitments under existing Free Trade Agreements (FTAs). Thai agricultural producers will remain protected under these arrangements.

2. Promoting Thai Investment in the United States

The U.S. seeks to boost domestic manufacturing and exports, while Thailand aims to increase investment in processed agriculture and energy sectors. On the other hand, the U.S. currently maintains an energy surplus, offering natural gas at significantly reduced prices (2–3 USD per million BTU compared to the market price of 10–11 USD) to Thailand.

3. Preventing Origin Fraud and Promoting Local Content

The U.S. has proposed stricter local content requirements, potentially increasing from 40% to 60–70%, to prevent the misuse of trade privileges. However, Thai business operators view this as an opportunity to boost domestic production and strengthen the local supply chain. By relying more on local content, Thailand can create opportunities for its manufacturers to enhance their production capabilities and become more competitive in global markets.

Small and Medium Enterprise (SME) Support Measures

To mitigate the impact on Thai SMEs and the agricultural sector, the government plans to allocate 200 billion THB in soft loans through state-owned banks, with interest rates as low as 0.01%. This initiative will support investment, employment, inventory management, and other operational costs. The government will subsidize the standard 2% interest rate as part of its comprehensive business relief measures.

people walking on pedestrian lane during daytime

Board of Investment (BOI) Measures to Retain Investment

Following the U.S. government’s announcement of reciprocal tariffs over the past two months, Thailand’s BOI has consulted with both domestic and foreign investors and introduced a comprehensive policy package. This initiative addresses two primary objectives:

1. Enhancing Thai Business Competitiveness and Strengthening Domestic Supply Chains

a. SME Efficiency Support: Thai SMEs are encouraged to invest in upgrades including machinery modernization, automation, energy efficiency improvements, and sustainable practices. Tax incentives have been enhanced from a 3-year exemption at 50% of investment value to a 5-year exemption at 100%.

b. Local Content Promotion: Companies in the electric vehicle (EV) and electronics sectors that meet specific local content requirements and obtain “Made in Thailand” certification will receive an additional 2-year corporate income tax reduction of 50%.

2. Mitigating Risks from U.S. Trade Measures and Regulating Specific Sectors

a. Enhanced Production Process Requirements: For sensitive industries (e.g., automotive parts, electronics, metals), the BOI now mandates clearly defined transformation of raw materials, requiring a change in customs tariff classification of at least four digits to ensure value-added production within Thailand.

b. Investment Regulation in High-Risk or Oversupplied Sectors: The BOI will discontinue promotion of specific low-technology or oversupplied industries (e.g., solar panels, furniture, long steel products). Certain sectors must maintain majority Thai ownership unless located in designated economic zones.

c. Foreign Labor Regulation Adjustments: Manufacturing facilities employing over 100 staffs must maintain a workforce that is at least 70% Thai nationals to ensure local employment benefits.

These incentives aim to attract foreign manufacturers to Thailand, strengthen supply chain integrity, and enhance the country’s overall economic resilience.

U.S. AI Chip Export Controls and Regional Implications

The U.S. has intensified export controls on advanced AI chips to prevent potential rerouting to China—a measure that could disrupt regional digital infrastructure projects. However, the Federation of Thai Industries (FTI) has clarified that such restrictions are unlikely to impact legitimate initiatives, including Amazon Web Services’ (AWS) has planned to set up data center in Thailand.

Current U.S. measures primarily target transshipment risks rather than restricting local deployment. Nevertheless, uncertainties persist, particularly regarding the scope and enforcement of these controls. For instance, U.S. regulations prohibit foreign data centers from exceeding the processing capacity of their American counterparts, and chipmaker NVIDIA is already prioritizing U.S.-based clients due to supply constraints.

Given these challenges, Thailand must continue monitoring U.S. policy developments closely while accelerating digital infrastructure upgrades and ensuring regulatory transparency.

Conclusion: A Unified and Strategic Path Forward

Thailand’s evolving role in global trade necessitates, a comprehensive strategy to address rising tariffs, technological scrutiny and pragmatic diplomatic approach and reinforcing investor confidence through proactive BOI measures and credible technology governance, Thailand can establish itself as a trustworthy and resilient economic partner.

The path forward requires coherence between domestic policy, international engagement, and innovation readiness, ensuring that Thailand not only weathers current economic headwinds but emerges stronger in the global economic arena.

Author: Panisa Suwanmatajarn, Managing Partner.

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Amendments to Thailand’s Act on National Competitive Enhancement: Aligning with OECD’s Global Minimum Tax

Background

The Act on National Competitive Enhancement for Targeted Industries B.E. 2560 (A.D. 2017) (the “Act“) was published in the Royal Gazette and became effective on 14 February 2017. The Act’s primary objective is to promote investment in targeted industries and enhance Thailand’s national competitiveness, with the overarching goal of transitioning the country beyond middle-income status. Under the Act, eligible targeted industries must either be newly introduced to Thailand or utilize new technologies or advanced production processes that contribute to the development and promotion of innovation.

Purpose of the Amendment

The Thai government has recently announced its intention to amend the Act to align the country’s legislative framework with the tax policy principles established by the Organization for Economic Co-operation and Development (OECD). In this regard, a draft Royal Decree has been issued to amend the Act on National Competitive Enhancement for Targeted Industries (No. …), B.E. …. (the “Draft Act“).

The proposed amendments aim to align Thailand’s legal framework with international tax standards in the digital economy, particularly those developed under the OECD’s Base Erosion and Profit Shifting (BEPS) 2.0 Pillar Two initiative—commonly referred to as the Global Minimum Tax (GMT).

Under BEPS 2.0 Pillar Two, multinational enterprise (MNE) groups with consolidated annual revenues of at least EUR 750 million (approximately THB 28 billion) are subject to a minimum effective tax rate (ETR) of 15% on their profits in each jurisdiction. If a subsidiary in any given jurisdiction is subject to an ETR below this threshold, a top-up tax may be levied by the jurisdiction of the ultimate parent entity or another qualifying group entity, pursuant to the OECD’s Model Rules.

In response to these global developments, Thailand is recalibrating its investment incentives regime to ensure continued competitiveness while maintaining compliance with emerging international tax obligations.

intermodal container stacked on port

Key Proposed Amendments

The key proposed amendments include:

  1. Granting of Tax Credit Rights and Benefits – Definitions are introduced for “Tax Credit,” “Remaining Tax Credit,” and “Tax Credit Refund.” The proposed amendments allow promoted entities to utilize tax credits instead of direct tax payments.
  2. Refund of Remaining Tax Credits – The Policy Commission may consider granting refunds for unused tax credits to promoted entities, subject to the availability of funds and limited to the remaining tax credit balance.
  3. Revocation of Tax Credit Rights and Benefits – If the Policy Commission revokes a promoted entity’s tax credit rights and benefits, the entity will forfeit all entitlement to tax credits for the relevant accounting period. Applicable tax laws will then be enforced accordingly.
  4. Inter-Agency Data Coordination – For purposes of investment promotion and evaluation, the Board of Investment (BOI) may request relevant tax collection data from the Ministry of Finance.
  5. Transitional Provision – If deemed necessary, the Policy Commission may authorize the retroactive application of tax credit rights and benefits to qualifying investments or expenditures incurred from 1 January 2025.

Current Status

The BOI serves as the principal agency responsible for the proposed legislative amendments, which are currently subject to a public consultation process taking place from 4 July to 18 July 2025.

Given the significant impact of tax credit utilization on government revenue and its relevance to the public interest, it is essential that the granting and use of tax incentives strictly adhere to the policies established by the National Policy Commission. Regulation through a structured permit or licensing system is necessary to maximize national development benefits, particularly in research and development (R&D), innovation, and the development of specialized talent in targeted industries.

Conclusion

Thailand’s adoption of the OECD’s GMT framework through the proposed legislative amendments underscores the country’s commitment to international tax cooperation while preserving its appeal as an investment destination. The introduction of the Qualified Refundable Tax Credit (QRTC) mechanism represents a strategic effort to foster innovation-led growth and align tax incentives with national economic and industrial priorities.

These reforms reflect Thailand’s broader objective of establishing itself as a regional hub for high-value, innovation-driven industries and as a responsible leader in economic development. The Draft Act is currently subject to a public hearing process, the outcome of which will be instrumental in determining the final shape of the legislation. As Thailand progresses toward implementation, sustained policy oversight and active engagement with stakeholders will be critical to ensuring the success and effectiveness of this landmark tax reform.

Author: Panisa Suwanmatajarn, Managing Partner.

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GI: New Framework for International Geographical Indication Registration

Introduction:

Thailand’s Department of Intellectual Property (DIP) has released a draft ministerial regulation outlining the procedures for registering foreign Geographical Indications (GIs) under international agreements. This initiative marks a significant step toward enhancing the protection of GI products and fostering international cooperation in intellectual property rights. The regulation is currently open for public consultation, inviting stakeholders to provide feedback before its formal enactment.

Purpose and Scope:

The proposed ministerial regulation establishes a legal and procedural framework for registering foreign GIs in Thailand through mutual exchange agreements. It is grounded in the authority provided by the Geographical Indications Protection Act B.E. 2546 (2003), specifically referencing Sections 4, 9, 10, 15, 16, 18, and 19.

The ministerial regulation applies exclusively to GI registrations conducted under international agreements where Thailand and its counterpart mutually recognize and exchange lists of registered GIs. It also covers cases where such agreements are already binding but require additional GI registrations.

red and blue plastic pack

Key Provisions:

1. Definitions and Applicability

  • “Application” refers to a request for GI registration submitted under an international agreement.
  • “International Agreement” includes treaties or arrangements where GI protection is a key component.
  • The ministerial regulation becomes effective from the date specified in the Royal Gazette.

2. Application Process:

  • Applications must be submitted electronically via the DIP’s system or designated email.
  • Required information includes:
    • Name of the GI
    • Product category
    • Applicant details
    • Country of origin
    • Product description
    • Geographical area definition
    • Link between the product and its geographical origin
  • Applications may be submitted in Thai or English, with Thai translations for key sections if submitted in English.
  • No application fee is required under this ministerial regulation.

3. Publication and Opposition:

  • Accepted applications will be published with detailed information including registration number, product details, and origin.
  • Oppositions must be submitted electronically, and applicants may respond through designated formats.

4. Registration and Record-Keeping:

  • Registration numbers will be issued from the date the international agreement takes effect.
  • The GI registry will include comprehensive details about the product, origin, and geographical linkage.

5. Appeals and Dispute Resolution:

  • Applicants may appeal decisions through a representative residing in Thailand.
  • Appeals are submitted to the Geographical Indication Committee.

6. Unsuccessful Negotiations:

  • If international negotiations fail, the application is considered withdrawn, and relevant parties are notified.

7. Communication Protocol:

  • All official correspondence will be routed through the negotiating partner.
  • After 30 days of dispatch, communications are deemed received unless related to appeals.

Implications for Stakeholders:

This ministerial regulation simplifies and formalizes the process for foreign GI registration in Thailand, promoting transparency and efficiency. It also aligns Thailand’s GI framework with international standards, potentially boosting trade and protecting cultural heritage.

Producers, exporters, and legal representatives involved in GI products should closely review the draft and consider submitting comments to ensure their interests are represented.

Key Takeaways:

  • Stakeholders are encouraged to participate in the public consultation to shape the final version of ministerial regulation.
  • Thailand is introducing a structured process for registering foreign GIs under international agreements.
  • Applications are streamlined, fee-exempt, and submitted electronically.
  • The regulation enhances transparency in publication, opposition, and appeals.

Author: Panisa Suwanmatajarn, Managing Partner.

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Thailand’s BOI 2025: Driving Sustainability and Local Content in EVs and Industry through Strategic Incentives

Thailand’s Board of Investment (BOI) is advancing transformative policies to modernize the nation’s economy by promoting sustainability, enhancing local value creation, and strengthening global competitiveness. At its meeting on June 27, 2025, chaired by the Deputy Prime Minister, the BOI approved three key strategic initiatives:

1. Promotion of Local Content Utilization

To promote and increase the utilization of local content in the electric vehicle (EV) and electrical appliance industries, the projects that satisfy the following local content thresholds will be eligible for an additional 50% reduction in corporate income tax (CIT) for a period of two years under this scheme:

  • BEVs and Electrical Appliances: The use of local components must exceed 40% of the total component value.
  • PHEVs: Local content must exceed 45% of the total component value.
  • EV Parts: Local raw materials usage must exceed 15% of the total raw material value.

In all cases, the products must be certified as “Made in Thailand” (MiT) by the Federation of Thai Industries (FTI).

2. Improvement of Conditions for Light Industrial Businesses and Certain Activities with Environmental Impacts

To ensure fair competition and support the development of domestic industries, the BOI has introduced new regulations requiring certain manufacturing sectors—specifically, the production of furniture and components, bag manufacturing, and printing—to maintain a minimum of 51% Thai ownership. This requirement does not apply to the projects located within Special Border Economic Zones.

In parallel, to reinforce environmental protection and community well-being, the BOI has strengthened regulatory conditions for industries identified as having significant environmental or social impacts. These include, but are not limited to, metal processing, chemical manufacturing, and industrial plastics production. The projects in these categories will no longer be eligible for land ownership rights and must be situated within designated industrial estates, which are subject to heightened regulatory oversight. These revised conditions will apply to all applications submitted on or after September 1, 2025.

factory worker reading the manual

3. Comprehensive Monitoring and Tracking of All Stages of the Investment Promotion Process

To strengthen enforcement, the BOI has established a “Special Audit Team” to closely monitor that projects at risk of violating conditions or misusing incentives. High-risk sectors under special scrutiny include tire manufacturing, solar cells, metal products, bags, and furniture.

Major Project Approvals

The BOI has approved two major projects worth a combined THB 28.64 billion which are a Tier 3 Data Center by Stratus Technology in Rayong (THB 23.69 billion), and an expansion of air transportation services by Thai VietJet Air (THB 4.96 billion), featuring six new aircraft to boost Thailand’s role as a regional aviation hub.

Conclusion

By combining significant infrastructure investments with local content incentives and targeted tax relief, the BOI is guiding Thailand toward sustainable industrial growth focused on domestic value creation and supply chain strengthening. As the BOI evolves from gatekeeper to integrator of investment flows, businesses and legal advisers must closely align with its updated compliance and certification requirements to capitalize on these strategic opportunities.

Author: Panisa Suwanmatajarn, Managing Partner.

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The Ripple Effect EP. 8: Thailand Faces 36% U.S. Tariff — Official Notice and Response

The United States has recently revised its trade policy by announcing significant increases in tariff rates on imports from multiple countries, including Thailand. Under these new measures, Thai exports to the United States will be subject to a 36% tariff rate.

Initially, the U.S. President granted a 90-day postponement of the enforcement date, extending the deadline to July 9, 2025. This grace period was intended to provide affected countries with an opportunity to engage in negotiations and submit formal requests for tariff relief.

In response, Thailand dispatched a high-level delegation to the United States and submitted an official proposal for tariff reconsideration in June 2025. Despite these efforts, on July 7, 2025, the U.S. government issued an official letter confirming that Thailand’s tariff rate would remain at 36%. The new enforcement date has been set for August 1, 2025. Notably, while several other countries succeeded in securing reduced tariff rates during the negotiation period, Thailand’s rate remains unchanged from the initial announcement.

Thailand’s Diplomatic Efforts and Regional Comparison in the 2025 Tariff Negotiations

Following the initial announcement, the Thai government promptly established a negotiation team to advocate for Thailand’s position and mitigate potential economic harm. However, despite these efforts, the negotiations did not result in any modification of the imposed rate.

Compared to neighboring Southeast Asian countries, Thailand’s outcome is notably unfavorable. Vietnam successfully negotiated a tariff reduction from 46% to 20%. Cambodia secured partial reductions on selected goods, while Laos and Myanmar obtained cuts from 48% to 44%. Indonesia’s negotiations remain ongoing. Malaysia did not achieve any reductions and continues to face a 25% tariff, which is still lower than Thailand. The Philippines and Singapore benefit from significantly lower rates of 17% and 10%, respectively. Vietnam’s result is widely regarded as the most favorable in the region.

a person s hand holding a pen near a piece of paper

Economic Impact and the Thai Government’s Response

The economic repercussions of this development have raised significant concerns. Analysts project that Thai exporters will be adversely affected—particularly in key sectors such as electronics, automotive components, and food processing. The continued enforcement of the tariff is expected to result in a contraction of GDP growth by approximately 0.5 to 0.7 percentage points in the second half of 2025.

In response, on July 9, 2025, the Thai government announced a comprehensive plan aimed at mitigating the impact of the new tariff. The plan includes measures to strengthen cooperation within ASEAN, diversify trade partnerships, and provide targeted support to businesses affected by the tariff imposition.

Conclusion

Thailand’s inability to secure tariff relief in the 2025 U.S. trade negotiations represents a significant missed opportunity and raises critical questions regarding the effectiveness of the country’s trade diplomacy. While others in the region succeeded in obtaining valuable concessions, Thailand’s unchanged position risks undermining its export competitiveness in the near term.

Although the government has announced a plan emphasizing regional cooperation and trade diversification, the success of these initiatives will largely depend on the rigor and speed of their implementation. The coming months will be pivotal in determining whether Thailand can recover lost ground and effectively recalibrate its trade strategy to navigate the shifting dynamics of the global economic landscape. Business operators should closely monitor the government’s implementation of these measures.

Author: Panisa Suwanmatajarn, Managing Partner.

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