THAILAND Trends and Developments Contributed by: Pisut Attakamol, Wasin Lertwalaipong, Pumma Doungrutana and Kosit Prasitveroj, Baker McKenzie
Baker McKenzie 195 One Bangkok Tower 4 30th–33rd Floors Wireless Road Lumphini, Pathum Wan Bangkok 10330 Thailand
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Clash of legal values Arbitration is grounded in party autonomy. When parties agree to arbitrate, the law generally respects and enforces the agreement. In principle, parties are bound to resolve their dispute solely through arbitra - tion. If one party breaches the arbitration agreement by initiating court proceedings, the other may apply to the court to dismiss the claim and refer the matter to arbitration, provided the arbitration agreement is enforceable. This doctrine of party autonomy is par - ticularly applicable in B2B contracts, where parties have comparable economic or bargaining power. In B2C contracts, however, consumer protection enters the equation. Most jurisdictions adopt public policy measures aimed at protecting consumers, who are generally perceived as having less economic or bargaining power than business operators. These pro - tections often take the form of laws on unfair contract terms, which shield consumers from unreasonably burdensome provisions. While arbitration may offer advantages in B2B con - texts, it can be problematic in B2C settings. For exam - ple, arbitration clauses in B2C contracts often require disputes to be resolved at an arbitration institute located in the business operator’s home country. Con - sider an online platform based in Europe that attracts users globally but mandates arbitration in Europe. An Asian user wishing to bring a claim would need to travel to Europe, potentially incurring substantial legal costs, even for a nominal dispute.
Enforceability of Arbitration Agreement in a B2C Contract Under Thai Law Introduction Arbitration is a form of alternative dispute resolution (ADR) that takes place outside the court system. Due to its confidential, flexible, and international nature, arbitration has gained substantial popularity in com - mercial disputes. Traditionally, arbitration was considered suitable only for disputes between business operators (B2B). However, it is increasingly used in disputes between business operators and consumers (B2C), especially those involving online platforms such as social media or e-commerce. For business operators, arbitration offers many advantages, particularly confidentiality, which helps safeguard business reputation. For arbitration to be binding, it must be clear that both parties have consented to it. This consent is typically expressed through an arbitration agreement, often included as a clause in the main contract. In B2C contracts, arbitration agreements are com - monly embedded in terms of use, often accompanied by detailed provisions tailored to the business. Some even exclude statutory rights, such as class action waivers. While many users accept these terms without scrutiny, they may unknowingly agree to arbitration. This raises a key question: is an arbitration agreement in a B2C contract legally enforceable? This chapter of the guide explores the issue.
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