Looking Back: 2022 and Gazing Into: 2023

2022 saw a gradual return to normalcy as the COVID-19 pandemic eased. The Thailand Board of Investment ("BOI"), which provides tax and non-tax privileges to local and foreign investors in Thailand, reported that applications for investment promotion in 2022 reached THB664.6 billion (approx. US$20 billion) from a total of 2,119 applications filed. This represents an increase of 39% from 2021’s adjusted figures. The key sectors were electronics, electrical appliances, automotive (in particular, the electric vehicles ("EVs")), supply chain and data centres. Foreign direct investment ("FDI") in these key sectors were made by major multinational players such as Amazon Web Services’ data centre investment.

Legislative amendments which had been placed on hold were implemented, most notably Thailand's Personal Data Protection Act (PDPA) on 1 June 2022, and a number of subordinate laws intended to flesh out key procedural provisions were issued.  The year also saw the ramping up of decision-making and enforcement proceedings under the Trade Competition Act, with a growing emphasis on unfair trade practices and the use of merger controls. Amendments to Thailand's intellectual property laws, such as in the areas of Copyright and Border Control Measures for Counterfeit Goods, have continued to improve the protection available  to  intellectual  property  owners in Thailand. We have brought on board an intellectual property team to assist our clients in these areas.  The Securities and Exchange Commission (SEC) issued several new rules which tighten the standards and requirements for undertaking a Digital Assets business and increase protections available for investors.  At the end of 2022, Thailand enacted the long-awaited Royal Decree on Operation of Digital Platform Services Which Require Notification.  Other significant amendments include changes intended to improve ease of doing business applicable to Thai private and public limited companies, such as with respect to (i) the holding of directors and shareholders meetings; (ii) changes to currency control provisions; and (iii) an increased focus on sustainability.

Investment figures published by the Thailand Board of Investment ("BOI"), which show that applications for investment promotion in 2022 reached THB664.6 billion (approx. US$20 billion), representing an increase of 39% from 2021’s adjusted figures, are interpreted as a sign of Thailand’s recovery from the pandemic and a positive investment outlook for 2023.  A new five-year BOI investment promotion strategy has been approved (2023-2027) to shape investment in Thailand into the "new economy" by enhancing national competitiveness, and strengthening the country's status as a regional hub for business, trade and logistics.

We expect to see companies place an increased focus on compliance in 2023, whether with respect to ensuring that their practices comply with the Trade Competition Act and do not attract the scrutiny of an increasingly active Trade Competition Commission of Thailand (TCCT), ensuring the proper implementation of obligations under Thailand’s six-month old Personal Data Protection Act (PDPA), or pursuing the various options available for protection of Intellectual Property.  We expect to see increased regulatory oversight over areas such as in respect of Digital Platform Service Providers and Digital Asset businesses, with the high profile collapse of various cryptocurrency firms that impacted Thai investors and is the subject of continued monitoring by the Thai regulator. It is also likely that Thailand will see the enactment of enhanced environmental laws in 2023, aimed at addressing climate change and achieving the Thai government’s stated goals, such as carbon neutrality by 2050 and net zero greenhouse gases by 2065.  We expect to see heightened awareness in Thailand of the need to implement environmental, social and governance (ESG) principles in corporate decision-making.

• Regional Round-Up 2022: Thailand