Thailand Law Journal 2009 Fall Issue 2 Volume 12

In part IV of trade in services chapter, there are specific commitments for market access and national treatment. For accessing in service market, both parties have to treat services or service supplier no less favourable than that provided for under the terms, limitations and conditions agreed and specified in Annex 8.⁶⁵ In limitations and measurements where market access commitments are undertaken, unless otherwise, specified in Annex 8, are:

(a) limitations on the number of service suppliers whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirements of an economic needs test;
(b) limitations on the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;
(c) limitations on the total number of service operations or on the total quantity of service output expressed in terms of designated numerical units in the form of quotas or the requirement of an economic needs test (this does not cover measures which limit inputs for the supply of services);
(d) limitations on the total number of natural persons that may be employed in a particular service sector or that a service supplier may employ necessary for, and directly related to, the supply of a specific service in the form of numerical quotas or the requirement of an economic needs test;
(e) measures which restrict or require specific types of legal entity or joint venture through which a service supplier may supply a service; and
(f) limitations on the participation of foreign capital in terms of maximum percentage limit on foreign shareholding or the total value of individual or aggregate foreign investment.

In aspect of Natural treatment of Article 810, both countries have to accord to service or service supplier in respect of all measures affecting the supply of services, treatment no less favourable than that it accords to its own like services and service suppliers.⁶⁶ The countries accord to other service and service suppliers by formally identical or different treatment as it accords to its own like services and service suppliers.⁶⁷ The formally identical and different treatment can be consider being less than favourable where it has modification of condition of competition in favour of its service and service suppliers when compared with services or service suppliers of the other countries.⁶⁸ As given above, it has various obligations for liberalisation of trade in goods between countries. The rules Chapter 8 of TAFTA, such as the limitation of implication of rules for money transfer and payment, the strengthen of cooperation in development of service trade, and natural treatment, can contribute to the decrease of barrier of trade in service and to the increase of exchange of services and service supplier of service trade between Thailand and Australia.

Investment 

The investment between Thailand and Australia is concerned in TAFTA. In Chapter 9 of TAFTA, it has the regulation to promotion and protection of investment for both countries such as Article 909, 910,912 and 914.

It has the implication of the component of catalyzation in fair and secure investments. The investors who invest in each country   will be supported and encouraged from government of both countries in each territory and they will be equitably treated and secured in their investment form each government.⁶⁹ Next, the   unreasonable expropriation from government is not permit in TAFTA for the security of investments of both countries? investors. No country in TAFTA can nationalise, expropriate, or subject to the equivalent of expropriation and nationalisation unless the country has reasons that the expropriation is for public purpose under due public law, that the expropriation is non-discrimination, and that the expropriation is accompanied by the payment of prompt, adequate and effective compensation.⁷⁰           

Moreover, in the context of Most Favoured Nation Treatment⁷¹ both governments have to treat investors  and their investments of other country as no less favour than it treat, in same circumstance, to other countries that are not party in TAFTA.⁷² The payment and transfer in investment also set out in this Agreement. Both governments have to allow, when requested, all funds that relate with investment of investors to be transferred freely into and out of its territory unless the transfers or payments of theses funds are not relating with bankruptcy, insolvency or the protection of the rights of creditors or ensuring the satisfaction of judgements in adjudicatory proceedings.⁷³ There are regulations to govern the investment in respect of security and support of investment in the Chapter 9. It, therefore, can imply that the governments of both countries will cooperatively support and encourage the investment between their countries due to the regulations in this chapter.

This article is published with the kind permission of Pornchai Wisuttisak, current PhD candidate, School of Business Law and Taxation, ASB, University of New South Wales, Master of Commercial Law, Macquarie University, BA, Political Science, Thammasat University, Thailand. This article originally appeared in the Thailand and Australia Free trade agreement (TAFTA): The advantage pace of foreign investment of both countries.