Signing a Contract with a Thai Company

Updated on Tuesday 19th July 2016

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For a lot of businesses, a relationship or a transaction has to be put in writing. Signing a contract with a Thai company represents an integral part of business relationships in the country. In Thailand, contracts are conscripted each day for various purposes. 

A significant difficulty for foreign investors in Thailand is the inability to comprehend a contract when signing it with a Thai company. Even when a translation of the contract in Thai language is offered, the deed can be poorly written in legal terms. Because of this, it is recommended that the foreign entity looks for legal advice with a Thailand lawyer who is fluent in Thai, English and is familiar with the legal terminology in both languages.
 

The Thai Civil and Commercial Code 


The principles of signing a contract with a Thai company are very similar to contract legislation in Western countries. The main legal structure which regulates the Thai contract interpretation is the Thai Civil and Commercial Code (TCCC). There can be though specialized areas of the law which influence business agreements in this country. Our Thai lawyers can provide more details on what this specific legislation consists of.
 

Types of contracts in Thailand


The types of contracts regulated by the TCCC in Thailand are as follows:

•    Sale;
•    Property renting;
•    Insurance;
•    Bills;
•    Partnerships and companies;
•    Employment;
•    Carriage;
•    Loan;
•    Pledge;
•    Warehousing;
•    Agency;
•    Brokerage;
•    Compromise;
•    Betting and gambling;
•    Deposits;
•    Suretyship;
•    Mortgage;
•    Current account;
•    Associations.
 

Practice for contracts in Thailand


In usual business law practice in Thailand, when signing a contract with a Thai company, there have to be two competent witnesses. In order to be accepted by a Thai court, contracts in Thailand have to be originally drafted in Thai language or they have to be translated in Thai language. 

In cases in which contract disputes come up, the contracting parties can solve them through court or an alternative dispute resolution like arbitration. A court complaint is generally advanced by a demand letter or “notice”. A lot of contracts mention mediation or arbitration before or instead of filling a case with a Thai court. Usually, contract disputes in this country are held in the international court, provincial court or in arbitration sessions. 

If you need more details, please contact our law firm in Thailand.

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