You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

October 7, 2021

Importers and Customs Consultation: Addressing Duty Disputes Early and Efficiently

Subscribe to Updates

The fast and efficient movement of goods is a hallmark of the modern global supply chain. In fact, it is often an expectation, with contractual commitments dependent on the timely and problem-free delivery of goods to the destination country. If unexpected costs or unreasonable delays occur, importers can find themselves liable to customers or beneficiaries, resulting in reduction or even elimination of anticipated revenue. One area of particular importance for importers is the customs clearance and assessment process, which is often one of the last but most critical phases of the global supply chain.

Importers, regardless of their experience or sophistication, have a duty to understand and comply with all applicable laws and regulations for the importation and classification of goods sent from other countries. While Thailand, like many countries, is a member of the World Trade Organization (WTO) and is obliged to adhere to WTO guidelines for the valuation and classification of goods. It also has its own regulations, policies, and customs laws that provide a legal framework for customs assessment challenges by importers. Often, importers or their agents can effectively process and clear goods with the assigned customs officials without encountering any issues. However, disputes do inevitably arise, often relating to origin, classification, and duty assessment. If not addressed early, a dispute can escalate, leading to seizure of goods, posts of guarantees, final assessments by customs authorities, and even allegations of civil or criminal wrongdoing. At such an advanced stage, it may be too late to engage in consultation to achieve a dispute settlement.

Instead of risking such a predicament, importers seeking to resolve disputes with customs officials should explore pre-assessment consultation opportunities. At this stage, there remains flexibility in approach and time to consult with customs officials, make submissions, and consider a flexible settlement. If this critical time passes and Thai customs issues an official assessment letter, options for an importer who wishes to challenge customs assessment will be severely limited.

In this first article in a two-part series on customs dispute resolution, we focus on pre-assessment consultation procedures and consider how importers can significantly reduce risks and liabilities by taking proactive steps to resolve any issues.

Letter of Assessment

To better understand the benefits of pre-assessment consultation and to appreciate the opportunity available to importers in disagreement with customs authorities, it is first important to understand the implications of an official letter of assessment. Normally, official letters of assessment are issued well after the period of importation and after Thai customs has conducted an initial audit and made duty or classification assessments. If there is a disagreement about this initial (or preliminary) customs assessment, an importer or its representative may defend its position, accept the preliminary assessment, or otherwise reach a negotiated settlement with customs. If no action is taken or a resolution of the dispute is not possible, Thai customs will issue an official letter of assessment.

Once this official assessment letter is issued, discretion in settlement is gone and only the full value of assessment will be accepted. Consultation opportunities in support of the importer’s arguments are no longer available, and the only remaining recourse is an official challenge with the Customs Board of Appeals or with the Thai courts—and only after the importer posts appropriate security based on the official customs assessment. Furthermore, under Thai law there may even be a risk of criminal claims brought by or through the Department of Special Investigation against the importer and its representatives. This risk is significantly lower if a matter is addressed at the pre-assessment stage.

Pre-assessment Consultation

When a dispute arises with Thai customs, it is critically important that the dispute be addressed early, since this provides time to engage customs officials, educate them on the importer’s position, and provide supporting documentation. It is also the only reasonable opportunity to consider an official negotiated settlement with customs. While the law does not provide a specific timeline for this consultation process, it should begin promptly to ensure that Thai customs is engaged and not moving toward issuance of an official assessment letter. If parties are engaged and are making progress in consultation, issuance of an assessment letter is less likely. However, if the law requires filing of a claim within the applicable prescription period for an offense (e.g., 10 years from the date of importation for matters involving duty declaration), customs officials may have no choice but to move ahead with official assessment in order to preserve its right to claim under Thai law.

Consultations with customs officials usually follow an initial audit by the assigned customs inquiry officer. If there are concerns about qualification for duty benefits under free trade agreements or if customs authorities believe there has been a classification error or under-declaration of duty, customs will advise the importer via official notice, often with a request to appear before customs. This is the beginning of the post-dispute consultation process and is an opportunity for an importer or its representative to explain its position and to otherwise convince the customs authority of why there is no violation of customs laws.

Customs authorities might make specific requests for supporting documentation from an importer. Such documentation, if available, might confirm the customs authority’s position or may serve to support an importer’s defense against customs dispute inquiries. It is important that any request for documentation be carefully considered so the importer can make a measured, but responsive, submission. This can both support the importer’s position and demonstrate good faith to the customs authority. This is an important factor in resolution of a dispute, whether through successful proof of the importer’s defense or through discretionary settlement.

Even if the customs authority has not requested information, it may be in the importer’s best interest to submit clarification of its legal position to the assigned customs inquiry officer. This can be anything from issue-based explanations via a simple letter to more detailed position statements explaining the importer’s legal position on valuation or duty exemptions. The level of complexity usually depends on the particulars of the case and customs’ understanding of the issues in dispute. This might involve a single submission or even multiple ones over the period of consultation, supported by in-person discussions on the issues addressed. Through this approach, carefully prepared, good-faith submissions of legitimate legal positions may lead to customs accepting the importer’s declarations. Sometimes, however, it is simply not possible to obtain customs’ acceptance of the importer’s declarations, in which case a focus on possible discretionary settlement may also be considered.

Settlement     

Customs settlement guidelines issued and updated by the director general of Thai Customs in 2017 permit settlement of active customs disputes. They also provide the customs authority with discretion in determining a negotiated settlement, subject to approval by the responsible customs settlement committee. When a dispute with customs cannot be resolved with measured, good-faith consultations and submissions, settlement may be the last viable option before issuance of a formal customs letter of assessment. Settlement at anything less than the full amount of the customs assessment is simply not possible once the customs authority has issued a letter of assessment. By consideration of settlement options at the consultation stage, it may be possible to avert an unfavorable assessment, resolve a dispute, and avoid costly and uncertain litigation with the Customs Board of Appeals or with the Thai court.

The most effective strategy in negotiation typically involves good-faith consultation and submissions in support of a negotiated settlement. Depending on the specifics of a given dispute, this may involve multiple consultations and submissions over time before arriving at a value approved by both the customs inquiry official and the settlement committee. If approved, the settlement represents a final resolution of the dispute.

Conclusion

The efficient movement of commercial goods is a critical component of the modern supply chain, and millions of goods cross borders every day without issue or dispute. When a dispute does arise, however, it can have a financial knock-on effect on multiple contractual players, leading to uncertainty and potential liabilities. For importers faced with customs disputes it is critically important that they and their representatives promptly and strategically assess their legal position and engage in focused consultation efforts with the relevant customs authorities. Depending on the particular case, consultation may lead to resolution of the dispute entirely or to a negotiated settlement, eliminating the uncertainty and cost of protracted litigation of customs claims.

Related Professionals

Practices

Customs and International Trade

Dispute Resolution and Litigation

Location

RELATED INSIGHTS​ 

January 9, 2026
On January 7, 2026, the Central Bank of Myanmar (CBM) announced a further relaxation of foreign exchange regulations through Notification No. 2/2026, with an effective date of January 1, 2026. This notification reduces the mandatory conversion requirement for exporters’ earnings in foreign currency into Myanmar kyat (MMK). Under the new notification, exporters are required to convert only 15 percent of their foreign currency export earnings into MMK at official CBM reference exchange rates, down from the previous required minimum conversion level of 25 percent. The adjustment provides exporters with more flexibility to manage foreign currency, improving liquidity for international transactions and reducing cash flow pressure. However, companies must still comply with the foreign currency conversion procedures and timelines set out in the CBM’s Notification No. 12/2022.
Read More
January 8, 2026
Doing business in Thailand means operating under a strict regulatory framework. From time to time, companies may receive unexpected administrative orders from government authorities that restrict their operations, impose new compliance obligations, or levy fines and penalties. When this happens, a business may challenge the order under Thailand’s administrative law system. The primary concern in pursuing administrative litigation is timing, as strict statutory deadlines apply and missing them can permanently affect a company’s rights. First Step: Administrative Appeal Many companies assume the first step is to immediately bring the matter before the Administrative Court to seek revocation or suspension of the order. Some even attempt to request an interim injunction to stop the order from taking effect. However, Thai law generally requires that the company first challenge the order through an administrative appeal with the same agency that issued it. Only after this process is complete can the matter be taken to court. Seeking an interim injunction at this stage is also not possible. This is because Thai law does not allow a standalone application for an interim injunction; an injunction can only be requested together with the underlying complaint filed with the Administrative Court. Since a court complaint cannot be filed until the administrative appeal process has been exhausted, an injunction is usually not available at the early stage. What Are the Timeframes for Administrative Appeal? Thailand applies a two-stage administrative appeal process. The appeal must first be submitted to the same authority that issued the order, which will review its own decision. If that authority affirms its decision, the appeal is then escalated to the relevant higher authority for further review. In most cases, both stages must be completed before a company is allowed to proceed to court. The timeframe for filing an administrative appeal is very
Read More
December 19, 2025
Prior to the dissolution of the House of Representatives, Thailand’s cabinet approved a draft amendment to the Administrative Procedure Act, following review by the Council of State. If enacted, this reform will fundamentally change how state agencies process business applications and appeals by imposing enforceable timelines and legal consequences for inaction. The draft directly targets a longstanding commercial frustration: applications and appeals that vanish into administrative silence, stalling investment and foreclosing judicial review across sectors ranging from real estate and manufacturing to healthcare and finance. The “Silence Means Yes” Rule for Applications At the core of the reform is a new automatic “approval by implication” for applications subject to statutory processing deadlines. If an official fails to notify an applicant of a decision within the legally prescribed period, the application will be deemed approved as a matter of law. This presumption shifts the costs of delay from businesses to the bureaucracy and gives applicants a definitive legal position once time expires. The mechanism applies to routine licensing and registration matters governed by explicit consideration periods in existing statutes or ministerial regulations. Officials may extend the decision period by up to thirty days, but only if they notify the applicant before the original deadline and substantiate that the delay arises from genuinely exceptional circumstances beyond their control. Certain sensitive applications are expressly excluded from automatic approval, including those that may significantly affect national security or defense, public safety and health, the environment or natural resources, or national cultural heritage. Once the deadline passes without a decision, businesses can proceed with deployment of capital and operations—construction, hiring, procurement, and market entry—without waiting for formal permission that may never arrive. For time-sensitive projects, this materially reduces regulatory timing risk. The “Deemed Rejection” Rule for Appeals The draft introduces a parallel “deemed rejection”
Read More
December 17, 2025
Tilleke & Gibbins has contributed the Thailand chapter to International Trade 2026, published by Chambers and Partners. International Trade 2026 provides an overview of international trade laws and regulations across major jurisdictions. The guide is designed as a practical reference for businesses, in-house counsel, and legal practitioners dealing with cross-border trade, customs, and regulatory compliance. The Thailand chapter examines key aspects of Thailand’s international trade framework, including: WTO membership, plurilateral arrangements, and free trade agreements Customs authorities, enforcement agencies, and customs regulations Trade sanctions regimes and compliance obligations Export controls, restricted persons, and licensing requirements Antidumping, countervailing duties, and safeguard measures Investment security mechanisms and regulatory oversight Subsidy and incentive programs for domestic production Standards, technical requirements, and sanitary and phytosanitary measures Geographical protections and other trade-related regulatory measures The chapter also highlights recent developments and pending regulatory changes affecting trade and investment in Thailand. Chambers’ International Trade 2026 guide brings together contributions from leading law firms worldwide, offering up-to-date, jurisdiction-specific insight into the evolving global trade environment. Tilleke & Gibbins also contributed the Vietnam chapter to International Trade 2026. A PDF of the Thailand chapter can be downloaded through the button below, and the full International Trade 2026 guide is available for free on the Chambers and Partners website.
Read More