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

December 18, 2024

The EU-Thailand Free Trade Agreement

Subscribe to Updates

The EU-Thailand Free Trade Agreement is drawing a lot of interest as the fourth round recently concluded in Bangkok. Despite negotiations starting in 2013, there was a ten-year pause before we saw the first round of negotiations end in September 2023. The initial plan was for four rounds of negotiations, with the free trade agreement (FTA) finalized in 2025. However, following the fourth round it is clear that the negotiations are still ongoing. Now, the question is: how much closer are the EU and Thailand to concluding their FTA?

The EU initially submitted 13 chapter proposals for the FTA, followed by a further 12, and these became the springboard for the negotiations. Given the complexity of agreeing on an accord of this size, there will probably be additional proposals submitted in 2025. These chapters have seen sector-specific negotiation groups formed, and although it has been difficult to truly gauge the status, steady progress has been made in each.

Arguably one of the biggest points of discussion pertains to the customs process for imports and exports. Both sides aim to align their practices in relation to rules of origin and custom rates, with preferential tariff treatments offered to goods originating from Thailand and the EU, as well as talks of eliminating or reducing relevant taxes. The desire for a faster customs clearance can be seen in EU proposals for clearance of goods on arrival. Although there has been progress in agreeing to a more simplified customs process, more work needs to be done before we hear news of the agreed-upon fees and charges, or confirmation of what goods would be allowed temporary admission.

When we consider customs clearance, it is important to also examine what this FTA could mean for rightsholders. One piece of good news is that it appears all three rounds of negotiations surrounding the intellectual property (IP) chapter have been based on the proposal submitted by the EU. While there are no guarantees that the chapter will be identical to the proposal that was submitted, it is likely that the final chapter will at least be formed from the bones of the proposal. For example, this is good news for businesses that have geographical indications on their products, as these (assuming the proposal is accepted) would be protected as long as the protections and marks remain alive in the home jurisdiction.

IP rights aren’t the only thing potentially subject to favorable treatment under the FTA. The same extends to the services and investment chapter. The proposal put forward by the EU is for national treatment for services and service suppliers—something that would be highly welcomed by those in the relevant industry, although not by those offering services such as audiovisual assistance, as that will probably fall outside the scope of the chapter.

With many in-depth discussions completed and many more to go, we are left to wonder when the final agreement will be settled. However, we know that such a large FTA can’t be finalized overnight. As such, we eagerly await the summary of the round-four negotiations and look ahead to what we can expect following round five. Based on what we have already seen, we hope to hear the good news that chapters on IP, transparency and good regulatory practices, and final provisions and exceptions have been agreed upon, as these appear to be the closest to settlement. However, we will wait until the EU publishes their latest summary report before making any promises.

Related Professionals

Practices

Customs and International Trade

Intellectual Property

Location

RELATED INSIGHTS​ 

January 29, 2025
The fourth round of negotiations of the EU-Thailand Free Trade Agreement (FTA) wrapped up in Bangkok in November 2024. Now that the latest summary report is out, it is worth highlighting some of the intellectual property (IP)-related changes we might see once the chapter is complete. Copyright If Thailand were to agree to follow the EU proposal, we would see the term of protection for copyright extended. Currently under Thai law, protection is the life of the author plus fifty years. This is twenty years less than the EU proposal. It seems that copyright is one area the two sides have yet to agree on, and it is no wonder as agreeing to follow Thai law would deprive authors from the EU of an additional twenty years of protection post-death. On the other hand, Thailand agreeing to the EU proposal would likely result in legislative change in the country to align domestic law with the FTA. We may also see more robust and streamlined collective management organizations (CMOs) in Thailand. The current proposal calls for each party to promote cooperation between their CMOs, which would extend to transparency over their running, including revenue and representation agreements. Thailand does currently have CMOs within the territory, and the Department of Intellectual Property (DIP) has a voluntary CMO code. However, it is unclear whether existing practice will be sufficient for EU rightsholders. CMOs have been an area that is difficult to regulate as there has been a balancing act between tightening the examination of reporting and not wanting to limit the freedom of rightsholders and how they commercialize their IP. Trademarks There is a fair amount of overlap between the Trademark Act in Thailand and the EU proposals. However, it is unclear to what degree the existing laws would satisfy the requests
Read More
January 21, 2025
A proposal to establish a specialized Intellectual Property Court in Vietnam has been a topic of significant interest among IP practitioners for the past 20 years. It was thus a major breakthrough when the new Law on the Organization of People’s Courts was ratified in 2024, stipulating in Article 4.1(dd) that the Vietnamese court system would include a specialized first-instance IP Court. The new law took effect on January 1, 2025, replacing the Law on the Organization of People’s Courts of 2014, A groundbreaking law This breakthrough can be viewed from multiple perspectives. First of all, in terms of organization, this is the first time, after numerous considerations, that Vietnam has officially recognized the importance of the IP field and the need to establish a specialized adjudicative body due to the field’s unique nature. The establishment of a specialized first-instance IP Court is expected to lead to fundamental changes in the practice of developing and applying IP law. While the establishment of IP rights such as trademarks, patents, and plant varieties is managed by administrative agencies such as the Intellectual Property Office, the Copyright Office, and the Crop Production Department, which seem unlikely to change their functions and tasks, there could be significant changes in the enforcement of these rights, which has been a persistent issue in Vietnam’s IP law system. Thus far, in practice, the enforcement of IP rights in Vietnam has relied overwhelmingly on administrative measures over civil measures. Civil measures, typically involving court proceedings under which the matter will be submitted to a court for settlement, are not appealing to disputing parties, especially IP rights owners. The absence of a specialized court has led to many IP cases being handled by judges without any knowledge or experience in this specialized field, resulting in confusion, misconceptions about
Read More
January 7, 2025
Myanmar’s Ministry of Commerce (MOC) announced a significant policy change allowing foreign companies incorporated in Myanmar under the Myanmar Companies Law 2017 to export eight categories of locally produced commodities, with effect from December 17, 2024. Notification 93/2024 allows eligible foreign companies—companies with more than 35% of their shares held by foreign entities or individuals—to export, manufacture, or trade the following additional commodities: Value-added meats, fish, and fishery products Value-added agricultural products Pulp and various papers Seeds Refined metals Semifinished or finished horticultural products, including fruits and vegetables Wood-based furniture Products supporting environmental conservation The notification, which was issued under the Export and Import Law 2012, does not set a minimum capital requirement for foreign companies taking advantage of these opportunities. Any type of foreign company can apply to export the eight commodities listed above. Companies permitted or endorsed by the Myanmar Investment Commission (MIC) that wish to engage in these opportunities must also adhere to the rules and regulations set by the MIC. To facilitate the export process, the notification specifies that foreign companies must obtain an export recommendation from the relevant government departments and an export license from the MOC’s Department of Trade for each of these commodities. For more information on this announcement, the relevant licensing authorities for different commodities, or any other aspect of import and export matters in Myanmar, please contact Tilleke & Gibbins at [email protected].
Read More
December 20, 2024
With intellectual property playing an ever-increasing role in economic development, the need to harness, promote, and protect ASEAN innovation remains urgent as integration progresses. Among its objectives, the ASEAN Economic Community aims to transform the region into a hub of innovation and competitiveness and ensure that the region remains an active participant in the international IP community. With ASEAN member states increasing IP generation and further committing to global IP regimes, the region is increasingly looking toward sophisticated IP ownership and holding structures. IP Holding Companies ASEAN-based companies continue to centralize ownership of their IP assets in offshore holding and licensing vehicles—an approach multinational companies headquartered elsewhere have been using for a number of years. IP-intensive companies look to locate their IP portfolios in low-tax jurisdictions with strong IP registration and protection laws. The company then licenses the IP to operating companies in the group or to third-party licensees, franchisees, agents, distributors, and other partners in return for royalties or license fees. These special-purpose vehicles are typically referred to as IP holding companies. IP holding companies are popular because they can help corporations minimize tax, gain tax benefits or concessions, protect IP from bankruptcy or other claims against the parent company, and focus management attention on the IP portfolio as an income generator. Tax and IP Holding Companies Tax is the primary reason most companies park their IP in separate IP holding vehicles. Sometimes, companies choose to establish their IP holding company in a no-tax, low-tax, or preferred-tax jurisdiction close to their home country. The selected jurisdiction should also be a country with a large and well-established tax treaty network. Double taxation treaties are key considerations in jurisdiction shopping. If the IP assets need to be pledged as security for future borrowings or if they are to be included
Read More