Cabinet backs Thailand as regional arbitration hub

The Thai Cabinet has approved a plan to make Thailand a regional hub for international arbitration, according to Deputy Government Spokesperson Lalida Persvivatana on August 18. This decision is part of a broader initiative to establish Thailand as a center for resolving international disputes.

Additionally, the Cabinet has given its initial approval to a draft royal decree that would grant the Permanent Court of Arbitration (PCA) and its staff various privileges and immunities. This would enable the PCA to hold meetings, hearings, and dispute resolution proceedings within Thailand. The PCA is an international organization that provides arbitration services and aids in peaceful dispute resolution between states.

Thailand has been a founding member of the PCA since its establishment in 1907, when it signed the Convention for the Pacific Settlement of International Disputes.

The draft host country agreement, proposed by the PCA in 2019, outlines the support Thailand will provide for the organization's operations in the country. This includes offering office space, meeting venues, utilities, and other necessary services. The agreement also specifies the privileges and immunities required for the PCA, its officials, adjudicators, and participants to carry out their duties independently.

These privileges cover property and document immunity for the PCA, exemption from certain taxes and duties, immigration support, and immunity for their official functions.

The Thai government has designated the Ministry of Justice as the primary coordinating point for implementing the agreement, while the Ministry of Interior will handle the waiver of visa fees. Tax agencies will adhere to the law to support the tax and duty privileges outlined in the agreement. Thailand's Arbitration Institute will provide offices, meeting rooms, hearing rooms, and utilities free of charge, with a maximum of 30 days per financial year, estimated to cost around US$45,000 (1.5 million baht).

In addition to these provisions, the agreement aims to reinforce Thailand's role in resolving disputes and open up opportunities for its legal sector. The government also anticipates that this move will enhance Thailand's influence in shaping international law and global dispute settlement mechanisms. The Ministry of Foreign Affairs regards the draft agreement as a treaty under international law, subject to Cabinet approval before signing and taking effect.

However, it does not require parliamentary approval, as it does not fall under treaties that necessitate such approval.