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In brief

The Trade Competition Commission of Thailand (TCCT) plans to focus on competition in the digital sector in 2024.


In more detail

The TCCT’s focus on the digital sector is consistent with recent efforts of competition regulators in other jurisdictions. The EU has adopted the Digital Markets Act, which aims to regulate the so-called ‘gatekeepers’, while in the US, the Federal Trade Commission (FTC) and the Antitrust Division of the Department of Justice have in recent years heavily scrutinized and brought actions against tech companies, including e-commerce platforms, particularly on their distribution and fulfillment systems and advertisements. Common allegations found in these FTC cases include predatory pricing, killer acquisitions, and copycats, and the authorities scrutinized how the companies control distribution, surveys new entry companies with future potential and use market dominance to suppress competition. Fines imposed in some cases are unprecedentedly large. Finally, regulators also closely scrutinized takeovers of smaller tech companies by larger ones, and in some instances, attempted to block these transactions. 

In Thailand, the TCCT recently told the press that it will issue a specific guideline for e-commerce. Citing numerous complaints that it received over the years, such as high fees and fixed logistics providers, the TCCT aims to promote fair trade and reduce impediments to competition. To draft this guideline, the TCCT is looking at the regulations of other countries, such as the EU’s Digital Markets Act. We expect that this guideline for e-commerce will be issued under the unfair trade practice provision of the Competition Act 2017; the same approach was adopted by the TCCT for issuing a guideline on online food delivery (see here). The other two digital sectors that the TCCT mentioned were “e-services and e-logistics.” No details have been provided as to what the TCCT’s plans for these two sectors are.

The TCCT will also be scrutinizing mergers & acquisitions (M&A) between digital platforms to prevent monopolies, noting that from 2019 to 2023, the total transaction value of digital platform M&A amounted to more than THB 4.27 trillion.

More generally, the TCCT will review its regulations to ensure that they are appropriate for regulating businesses in this fast-changing environment. The current regulations were issued under the Competition Act 2017.

Abuse of dominant positionUnfair trade practiceAnti-competitive agreements
How dominance is determinedWhat dominant businesses cannot doWhat trade dealings may amount to unfair trade practicesSpecific sector guidelines: franchise, credit terms with SMEs. modern trade, and online food deliveryWhat agreements constitute a cartelExemptions that are available
Merger controlAdvance rulingOthers
What transactions are subject to merger controlWhen a transaction needs clearanceWhen the authorities need to be notified of the transaction after closingHow a business can seek an advance ruling from the TCCTWhen companies are deemed to be in the same groupHow a market is defined

What’s next?

A draft of the e-commerce guideline is expected to be published for public hearing early next year. Businesses and other stakeholders will then be invited to provide comments on the draft.

Author

Ampika Kumar is a Partner at the Baker McKenzie Office in Bangkok. She joined Baker McKenzie in February 2002 and is currently active in the Corporate and Commercial and Insurance practice groups. Her areas of expertise include insurance regulatory, corporate restructuring, mergers & acquisitions (both for private limited and public limited companies) and trade competition. Ampika is recognized as a "Band 2" lawyer in the area of Insurance and 'Band 1' in Competition / Antitrust for Thailand by the Chambers Asia Pacific guide.

Author

Pornapa Luengwattanakit currently leads Baker McKenzie’s Corporate & Commercial, Tax, as well as the International Trade, Compliance & Customs practice groups in Thailand. She practices mainly in the areas of corporate restructuring, major projects, mergers and acquisitions and trade competition. Ms. Luengwattanakit joined Baker McKenzie in 1982 and became a partner in 1989.

Author

Jaywon Yi is a Partner in Baker McKenzie, Bangkok office.

Author

Napasa Cheydet is an Associate in Baker McKenzie Bangkok office.

Author

Thitapa Haritaworn is an Associate in Baker McKenzie Bangkok office.

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