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Thailand to prepare new regulations for Digital Platforms
07/11/2022
On the 21st of September, 2022, Thailand’s Electronic Transactions Development Agency (ETDA) held a public hearing on the draft Royal Decree on Digital Platforms and its sub-regulations.
Following this public hearing, the draft Royal Decree on Digital Platforms has been updated to reflect the feedback received. This new draft is expected to be the final draft before it is presented for the final stages before enactment.
Once everything is set the draft decree will be published in the Government Gazette and will become effective 240 days after the publication date.
What are the key issues contained within the draft decree?
The key issues under the latest draft royal decree are as follows:
Exemption for certain regulated businesses
There are expected to be exemptions for business operators that are regulated by the Bank of Thailand or the Securities and Exchange Commission, as well as digital platforms operated by government agencies for noncommercial purposes, from the application of the royal decree.
Such business operators must ensure that their digital platform has transparency, fairness, and standards that are not less than those required under the Royal Decree.
Definition of digital platform
After feedback from the public hearing, the definition of a digital platform has been amended to exclude digital platforms that are used to offer the goods or services of a digital platform provider or its affiliate acting on its behalf, regardless of whether the offering of such goods or services is made to a third party or the affiliate.
Appointment of a local contact
The new draft royal decree now only requires offshore digital platform providers to appoint a local contact to coordinate with the ETDA.
The appointed local contact must not operate any business in Thailand under the Foreign Business Act.
Notification of the ETDA
Digital platforms are required to notify the ETDA of certain information such as,
- the name of the business operator and its digital platform,
- contact details of the business operator and
- the type of services offered through the digital platform—prior to commencing business operations.
Furthermore, the following digital platform types must notify the ETDA of additional information upon meeting a certain threshold:
- Digital platform services that have revenue (before subtracting expenses) from the provision of digital platform service in Thailand of more than THB 1,800,000 per annum (for individuals) or more than THB 50,000,000 per annum (for corporate entities); or
- Digital platform services that have more than 5,000 users (see definition below) in Thailand in a month.
Apart from notifying the ETDA of the digital platform operations, the two digital platforms mentioned above must also comply with other requirements for the operation of a platform, as prescribed by the royal decree. Digital platforms that do not satisfy the above criteria are not required to comply with the requirements for the operation of a platform prescribed by the royal decree.
Large Digital Platform Services
Large digital platforms services are digital platform services with revenue (before subtracting expenses) exceeding THB 300,000,000 per annum for each type of service or exceeding THB 1,000,000,000 per annum for all kinds of service, or with users in Thailand exceeding 10% of the country’s total population.
Such platforms are subject to additional requirements. For example, they will be required to conduct risk assessments and implement risk management measures, security measures for their systems, and crisis management measures. They also need to appoint a compliance officer, conduct external audits, and comply with other obligations to be prescribed by the ETDA.
Notification of terms and conditions
Digital platform providers will be required to notify their users about the terms and conditions for using the platform, before or at the time of use:
This will apply to digital platforms that:
- provide services to users at a distance, with compensation;
- act as an intermediary for the offering of goods or services to users, regardless of whether transactions related to the goods or services are made on the platform in whole or in part; and
- enter into an agreement with merchants that operate on the platform.
- Search engines.
Number of Users
Users have been defined as people who use a digital platform which includes both business operators and consumers.
User numbers are to be calculated based on the average monthly active users (AMAU), which measures the average number of unique and active users who use a digital platform within the specified period, regardless of whether the user has an account with the digital platform or has logged in to use the digital platform.
There are also provisions relating to how the number of users is to be counted. For example, bots or scrapers and any unusual monthly active users can be excluded pursuant to certain criteria will be excluded from the calculation. However, users who visit a digital platform without making any purchase will be included when calculating the AMAU.
Cessation of Business Operations
The draft royal decree stipulates that digital platforms must notify the ETDA prior to the anticipated date of business cessation. Furthermore, certain digital platforms must also notify the ETDA of any remedial plans and measures which will be used to protect users.
The business ceases when a notification is issued by the competent officer.
Remedies
Under the draft decree, a digital platform provider is required to implement remedial measures to reduce any potential damage and remedy users who incur damages from a digital platform.
Examples include:
- implementing a complaint procedure,
- offering a help desk for users and
- other measures as prescribed by the ETDA.
How can Belaws help?
For more information about digital platforms in Thailand, you can talk directly to one of our experts.
Please note that this article is for information purposes only and does not constitute legal advice.
Our consultations last for a period of up to 1 hour and are conducted by expert Lawyers who are fluent in English, French and Thai.
Consultations can be hosted via WhatsApp or Video Conferencing software for your convenience. A consultation with one of our legal experts is undoubtedly the best way to get all the information you need and answer any questions you may have about your new business or project.
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Frequently asked questions
Do expats pay income tax in Thailand?
Thailand imposes an income tax on any income earned in Thailand for both resident and non-residents individuals. This tax will be imposed regardless of whether such income is paid in or outside of Thailand.
Do Thai citizens pay taxes?
Yes, Thai citizens are subject to tax.
What happens if you dont pay tax in Thailand?
You will be subject to Imprisonment for a term up to 1 year; or a. Fine up to 200,000 Baht; or. Both.
What’s the average cost of living in Thailand?
On average, $1,500 a month is accepted as a suitable income for a comfortable life in Thailand.
How can I avoid tax in Thailand?
It is not recommended to avoid paying tax in Thailand.
Do expats pay tax in Thailand?
Thailand imposes an income tax on any income earned in Thailand for both resident and non-residents individuals. This tax will be imposed regardless of whether such income is paid in or outside of Thailand.
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