What should a Brokerage Agreement include under Thai law?

1. Definitions and Interpretation
2. Appointment
3. Term
4. Broker's Services
5. Registration of Customers
6. Principal's Rights and Obligations
7. Commission
8. Payment of Commission and Taxes
9. Expenses
10. Warranties
11. Limitation of Liability
12. Confidentiality and Personal Data
13. Anti-Bribery
14. Breach and Termination
15. Consequences of Termination and Protection Period
16. Notices
17. Governing Law and Disputes
18. General

• Thai law distinguishes a broker from an agent. A broker brings the parties together and earns commission only when a contract is concluded as a result of that introduction; if the contract has a condition precedent, commission waits until the condition is fulfilled (Civil and Commercial Code section 845). A broker is presumed to have no authority to receive payment for either party (section 849), and is not liable for a party's failure to perform, unless the broker did not disclose that party's name (section 848).
• An agent can bind the principal (section 797), and a principal may also be bound by someone it allowed to appear as its agent (sections 820–821). So in practice: do not give the Broker company letterhead, stamped quotations or an email address that suggests it is part of your staff, and always have customers pay your own account (Clause 4.5).
• A broker who works for the other side as well, or accepts an improper promise from it, loses the right to commission and expenses (section 847). Clause 4.7 makes the Principal's written consent the test.

• Register every lead by email under Clause 5.1 before negotiating, and keep the Principal's confirmation or the email showing that 5 Business Days passed without a reply (Clause 5.2). In a commission dispute, this record usually decides who introduced the customer.
• A registration lapses if no sale is signed within 12 months (Clause 5.3). Ask for a written extension if a deal is still active.

• This Agreement gives the Broker no authority to act for the Principal, so it is not an appointment of an agent (Instrument 21 of the Stamp Duty Schedule), and no stamp duty is payable on it. If you add authority for the Broker to sign or collect for you, the appointment carries stamp duty of 30 THB (general agency) or 10 THB (a single act), payable by the Principal.
• A power of attorney made in Thailand for someone to sign this Agreement carries stamp duty of 10 THB for a single act or 30 THB for more than one act (Instrument 7).

• Tax invoice: the Broker supplies the service, so a VAT-registered Broker issues the tax invoice and the Principal pays VAT on top of the commission (Clause 8.3). A Broker that is not VAT-registered issues an ordinary invoice or receipt.
• Withholding tax, Thai Broker: a Principal that is a company or partnership normally withholds 3% from commission paid to a broker in Thailand and gives the Broker a withholding tax certificate (Clause 8.4).
• Withholding tax, overseas Broker: commission paid to a broker abroad may be subject to Thai withholding tax at a different rate, which a double tax treaty may reduce or remove. If the service is used in Thailand, the Principal may also have to self-assess and pay Thai VAT on the imported service. Ask your accountant before the first payment, because the Principal is liable if it withholds too little.
• The Commission is paid in the currency of the Sales Contract (Clause 8.2). Keep the exchange rate used for your accounts.

• The signed Agreement, every registration email and confirmation, and the monthly statements (Clause 8.1).
• Each Sales Contract or accepted order with an Introduced Customer, and the customer's payments if commission is paid on payment.
• Emails used as notices, with the header showing the time sent and any bounce message.

• Either Party may end the Agreement on … days' notice without a reason (Clause 14.1). Sales to registered customers signed within … months afterwards still earn commission (Clause 15.2), unless the Principal ended the Agreement for a Serious Breach.
• To terminate for breach, first send a notice describing the breach. The …-day cure period starts on the day after the notice is received, and termination takes effect when the termination notice is received (Clause 14.4).
• If you keep accepting late reports or late payments without objecting, a Thai court may require a fresh deadline before you can terminate. Object in writing each time.

• A company should sign through the director or directors authorised in its latest company affidavit or home-country equivalent, and affix the company seal if its rules require one. An individual should sign in person and attach a copy of the ID card or passport.
• Clause 18.6 allows electronic signatures and signed PDF copies. Keep the final signed file unchanged.

• A Thai court works in Thai. A Party that relies on this Agreement or on English emails in a Thai court must file a Thai translation certified as accurate. Clause 18.7 says the English text prevails, so have the translation checked carefully.
• Against a party with no assets in Thailand, a Thai court judgment may be hard to enforce. An arbitral award made in Bangkok can be enforced in most countries under the New York Convention of 1958.

Compiled from the notes that accompany the English contract templates on this site, published by Phuwara Krobtaku (ภูวรา ครอบตะคุ), Thai attorney-at-law, licence no. 477/2558. The short answer and summary at the top of this page are put together by the site from the template's clause headings and notes. Statutes are quoted only in the official Thai text: Thai is the only official language of Thai legislation, and an unofficial translation can mislead. Article registry OKC-3A6C43. If you reuse this content, please credit the author and link to the original.