What should a Freight Capacity Reservation Agreement include under Thai law?

1. Definitions and Interpretation
2. Reservation and Commitment
3. Bookings
4. Release of Capacity
5. Carrier's Failure to Provide Capacity
6. Unused Capacity Charge
7. Rates and Fuel Adjustment
8. Carriage and Liability for Goods
9. Invoicing and Payment
10. Taxes and Stamp Duty
11. Limitation of Liability
12. Confidentiality
13. Anti-Corruption and Compliance
14. Subcontracting
15. Force Majeure
16. Term and Termination
17. Notices
18. Governing Law and Disputes
19. General

• A contract of carriage for a fee is stamped as a hire of work (Instrument 4 of the Stamp Duty Schedule), on the Contract Value (Clause 10.3). Duty is 1 THB for every 1,000 THB or part of 1,000 THB. On the Contract Value you entered, the duty on the original is the amount the system calculates from the figures entered, and each counterpart carries the amount the system calculates from the figures entered.Because the Rates are in …, convert the Contract Value to Thai Baht at the exchange rate on the date of signing and calculate the duty on the Baht amount. Each counterpart carries 5 THB, or 1 THB if the duty on the original is 5 THB or less.
• The Carrier pays the duty. If the amounts actually received exceed the Contract Value, more duty becomes payable when they are received. If the Contract Value is 1,000,000 THB or more, the duty must be paid in money to the Revenue Department instead of by affixing stamps.
• An unstamped agreement cannot be used as evidence in a Thai civil court until the duty and a surcharge of up to six times the duty are paid (Revenue Code section 118).

• Carriage of goods within Thailand is generally exempt from VAT, and international carriage by sea or air by a Thai carrier may be at 0%. Check the treatment of each Lane with your accountant (Clause 10.1).
• A Thai company or juristic person normally withholds 1% on transport charges paid to a Thai carrier (Revenue Department Order Tor.Por. 4/2528, clause 12/4). Payments to a carrier abroad follow different rules; take advice before the first payment.

• For each Lane and …, you commit to use …% of the Reserved Capacity. For each Unit below that level, you pay …% of the Rate (Clause 6.1). If the Carrier fails to provide booked capacity, the same percentage works in your favour for substitute transport (Clause 5.1).
• Release capacity that you will not need at least … days before the … starts, up to …% (Clause 4). Tell the Carrier at least 48 hours ahead when a planned loading will not happen, so that the capacity can be resold (Clause 6.3).
• Under Thai law, a pre-agreed charge for non-performance can be treated as a penalty, which a court may reduce if it is disproportionate to the real loss (Civil and Commercial Code section 383). Keep the percentage close to the Carrier's real loss after saved costs (Clause 6.2).
• Check each Period statement and dispute errors within 10 Business Days (Clause 6.4).

• Rates move each month with the average Bangkok retail diesel price published by the Energy Policy and Planning Office, using a base price of THB … per litre and a fuel share of …% (Clause 7.2). Save the published figure each month to check the invoices.

• Give written notice of hidden damage within … days after delivery (Clause 8.4). Claims against a carrier for lost, damaged or late goods may become time-barred as soon as one year after delivery, and Thai law does not allow the parties to extend this period by contract.

• A company should sign through the director or directors authorised in its latest company affidavit, with the company seal if the affidavit requires one. For a foreign carrier, ask for a recent certificate of incorporation and evidence of the signatory's authority.
• Keep the signed Agreement, all Bookings and confirmations, release notices, Period statements, invoices and payment slips.
• A Thai court works in Thai. A Party that relies on this Agreement or on English documents in a Thai court must file certified Thai translations.

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-274FD0. If you reuse this content, please credit the author and link to the original.