Thailand: Forthcoming Regulation To Regulate Digital Platform Services

THAILAND: FORTHCOMING REGULATION TO REGULATE DIGITAL PLATFORM SERVICES

The main purpose of this Draft is to regulate the business of providing digital platform (the "Digital Platform Service") by establishing regime for notifications and certifications for such business operation, along with designating certain duties to be observed by the business operator providing such Digital Platform Service (the "Business Operator")

With the recent approval of the Cabinet on the Draft Royal Decree on the Supervision of Digital Platform Services Subject to Prior Notification (the "Draft Royal Decree"), providers of digital platform services are about to come under the new and potentially extensive regulations and supervisions of the Electronic Transaction Development Agency (the "ETDA").

1. Draft Royal Decree

The Draft Royal Decree was first announced by the ETDA for public hearing on 15 July 2021. After the internal review process within the Ministry of Digital Economy and Society, it was sent to and approved in principle by the Cabinet on 25 October 2021. Currently, it is under review of the Council of State, and would need to be forwarded to the Cabinet for final approval again before becoming effective. The Draft Royal Decree will be issued under the Electronic Transactions Act B.E. 2544 (2001) as amended, with the ETDA being the main regulator under this draft.

The main purpose of this Draft is to regulate the business of providing digital platform (the "Digital Platform Service") by establishing regime for notifications and certifications for such business operation, along with designating certain duties to be observed by the business operator providing such Digital Platform Service (the "Business Operator").

Please note that the content of the Draft Royal Decree as presented in this article is based on the latest draft version available to us, and as this Draft Royal Decree is still in the drafting process, it is subject to future change.

2. Applicability

There are two key aspects to consider regarding the scope of application of this Draft Royal Decree: the nature of the Digital Platform Service to be subject under this Draft Royal Decree, and its extraterritorial effect for Business Operator located outside Thailand.

The Draft Royal Decree will apply to the Digital Platform Service that is in the nature of an intermediary platform that provides space for business operators on the platform (the "Business User") and consumers to connect using computer network¹.

For the purpose of this Draft Royal Decree, the Business User only refers to individuals who offer products, services, or properties to the consumers in commercial or professional manner for the purpose relating to commerce, business, craftmanship, or profession, regardless of whether such Business Users are member to or hold accounts on that platform or not². As such, this Draft Royal Decree would only be applicable to the Digital Platform Services that includes these Business Users in their scope of services, while other digital platforms which provide service exclusively to other kind of business users, such as business users that are company, would not be subject to this Draft Royal Decree.

On the aspect of the extraterritorial effect of this Draft Royal Decree, it is provided that the Draft Royal Decree shall be applicable to the Digital Platform Services intended to be provided to consumers inside Thailand, regardless of where the Business Operators are located.

Business Operators located outside Thailand may be deemed as providing the Digital Platform Service intended for consumers inside Thailand if the services provided are within the nature of the prescribed characteristics, such as, all or part of the services are provided in Thai, or the payment is designated or can be designated to be in Thai Baht currency.³

The Business Operators located outside Thailand that are deemed as providing the Digital Platform Service intended for consumers inside Thailand are required to appoint their representatives residing inside Thailand with no limitation of liability relating to the provision of the Digital Platform Service under this Draft Royal Decree.⁴

3. Outline of Duties for the Business Operator

The most noticeable duty assigned to the Business Operator under this Draft Royal Decree is the duty to notify the ETDA prior to the commencement of its provision of the Digital Platform Service. Other duties include the duty of the Business Operator who provides the Digital Platform Service under certain prescribed characteristics to notify the platform users (i.e. including both Consumers and Business Users) of the prescribed information, specific duties to be designated to large or specific Business Operators, and the duty to notify the ETDA prior to cessation of its Digital Platform Service.

Firstly, prior to its business operation, the Business Operator must notify the ETDA of its intention to provide the Digital Platform Service. Afterward, the certificate of notification receival will be issued to the Business Operator within the date of notification receival and the Business Operator may start providing the Digital Platform Service. It may be worth noting that there is no licensing requirement for the Business Operator which requires specific approval from the ETDA, although the receival of notification may be revoked from the registry later if the notification is found to be incorrect or incomplete. In addition, certain Digital Platform Service may be exempted from this duty as prescribed by the Electronic Transactions Commission (the "Commission").⁵

Secondly, the ETDA has the power to prescribe the characteristics of the Digital Platform Service which must notify the platform users of certain prescribed terms and details. These might include the terms of service, criteria for listing or ranking products or services on the platform, access and usage of the data received from the provision of Digital Platform Service by the Business User, complaint channel and dispute resolution, etc.⁶

In addition, the ETDA, with the approval of the Commission, may prescribe specific duties for the Digital Platform Service deemed as large platform or having specific characteristics.⁷

Business Operators who intend to cease its business of the Digital Platform Service must notify the ETDA for no less than 60 days prior to the date of cessation of its business.⁸

Violation of this Draft Royal Decree may result in the order to cease the provision of Digital Platform Service and the revocation of the violating Business Operators from the notification receival registry.⁹ Moreover, the violating Business Operators may be liable to an imprisonment of up to one year or a fine of up to Baht 100,000 or both.¹⁰

Apart from these duties, it may be worth noting that, for the purpose of providing accommodation for the Business Operator in notifying the ETDA, this Draft Royal Decree also authorizes the ETDA to request to other state entities for the disclosure of or access to the data collected from the Business Operator by such state entities, either by law or on contractual terms.¹¹

4. Effective Date

The Draft Royal Decree will become effective after 180 days from the date of publication in the Government Gazette. The Business Operators who provide Digital Platform Service prior to the effective date have 30 days to comply with the new regulations counting from the effective date and must make notification to the ETDA within these 30 days period.¹²

Disclaimer – The views expressed in this article are the personal views of the authors and are purely informative in nature.