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Finally reported: Kasit off to Germany to retrieve royal jet


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a) He didn't pick the strawberries himself. He got fed by his princess. Not the worst way to spend your time.

B) This happened about three weeks ago. Before the plane got grounded. Most papers just write 'recently' so we make the mistake assuming it happened after the plane got grounded.

c) The crown prince is not grounded and most likely he found someone to pay for a private jet back home where everyone gets a Boeing 737 offered as a present. Hint: it's a bad time right now flying your present to germany.

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Hint: it's a bad time right now flying your present to germany.


Or the U.S. The German liquidator has confirmed arbitration award there with no stay on enforcement. Many financial transactions clear through New York, if any Thai transaction are clearing through New York, the Thai government may be in for an unpleasant surprise. This may be why the German administrator sought confirmation of the award in Germany.


He can also enforce the award in Singapore, Hong Kong, Japan or any other of the more than 146 countries that are parties to The New York Convention on Arbitration Awards.


In theory, and in practice with more advanced countries, you only need to establish compliance with the most basic of procedural requirements to enforce an award. You don't need to re-argue or re-litigate the underlying dispute as you do in Thailand. You can almost always enforce while an appeal is appending, and the grounds for a successful appeal are very narrow.


The few countries that thumb their noses at arbitration awards not only harm their reputations, but also undermine their ability to operate in world financial markets. They risk seizure of their assets at all sorts of awkward moments. The world is getting smaller.


Why didn't Thailand just satisfy the award at the outset? This is sheer pig-headed lunacy.

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Companies insist on arbitration clauses not because they do not trust the legal system of a country but rather, in theory at least, arbitration is suppose to be a cheaper and quicker alternative to arrive at a settlement of a dispute. The problem many have with arbitration is neither side is usually happy with the decision, which tends to be an arbitrary compromise that avoids ruling on which party is actually right and instead just ends up saying one party has to pay so much to the other. This case is complicated even more due the politics of the times which is the overriding reason the government (and there has been 4 of them during the claimed period, arbitration proceedings, award and subsequent court battles around the world).


Arbitration panels are not some sort of “impartial international panel†and your reference to such shows your ignorance of how arbitration works.


An arbitration panel is made up three members, one each appointed by the parties and a chairmen that is either mutually agreed or appointed by the ICC court in Paris (sometimes this is the ICC court in the country where the proceedings are being held).


In this case, each party appointed a member and since they could not agree on a chairmen, he was the chairman was appointed.


Note that Thailand has an ICC and in many contracts with arbitration clauses, the proceedings would be held in Thailand under Thai ICC rules


What makes this case so controversial is the claim came about because of the actions of the TRT government in 2004 to not raise the tolls as required by a MOU signed in 1996. Thaksin made huge amount of political hay out of not raising the tolls, he held a press conference at the toll plaza announcing that not only would the tolls not be raised, but they would be lowered until the amount collected by the raise he was reversing was recovered by the motorist.


The other issue is the arbitration action was done under a FTA treaty that TRT signed with Germany in 2002, not under any arbitration clause in the actual contract as there is none that affords the German company such action. The tribunal ruled that only damages incurred after that treaty would be awarded to the “investor†protected by that TRT signed treaty.


So, now you have a minority share holder in the JV that owns the Tollway Concession, who has since sold out and is now claiming for a reasonable rate of return on investment made 8 years before a TRT signed treaty that he is claiming under went into effect. All this done during the TRT administration and now the current government is expected to pay up. Not a pleasant prospect and I’m sure this is just another political hot potato the Democrats are happy to give to the PTP to solve.


I don’t agree that this case highlights any perceived shortcomings in the Thai court’s fairness by the international business community. There is indeed a justifiable perception in the slowness, and resultant expense, of the Thai court system which makes companies doing business here try to get arbitration clauses into contracts and they will accept Thai ICC arbitration.


Your true antagonism to Thais and your ethnocentrism is again revealed despite your attempts to hide it within some pseudo-intellectual mumbo jumbo that so many buy into.



PS - Here's the link to arbitration award.


Fascinating reading if you can read legal language such as this. Once you get past that, it a really interesting story.

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I don’t agree that this case highlights any perceived shortcomings in the Thai court’s fairness by the international business community. There is indeed a justifiable perception in the slowness, and resultant expense, of the Thai court system which makes companies doing business here try to get arbitration clauses into contracts and they will accept Thai ICC arbitration.


So you are saying that the Thai courts are _not_ being seen as more corrupt as for example in Taiwan, Japan or Hongkong? And that Foreigners have in LOS an equal chance to win a case as their local Thai opponents?




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I quote from Flashs first post:

"The action was based on a decision in 2009 of the United Nations Commission on International Trade Law for Thailand to pay Walter Bau more than 30 million for breaching a bilateral investment treaty between Germany and Thailand. The UN court found that the Thai government breached the terms of a toll road concession operated by a venture partly owned by Walter Bau."


It's not a question any more if the thai government owes Walter Bau money, it's a fact.

Also a fact that a change in government does not void any bills. Since 2009 neither did the tahi government pay nor did they (as far as I know) move to change the decision. The thai government just stalled and that lead to current events.

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THE NATION19 July 2011




Plane stupid: the damage is done


by Alexander Mohr



Last Thursday, the Boeing 737 used by HRH Crown Prince Maha Vajiralongkorn was seized at Munich Airport in Germany.


The insolvency administrator for the German company Walter Bau, Werner Schneider, ordered the seizure of the aircraft. However this issue is eventually resolved, the damage to bilateral relations has been done.


The background to this story concerns a contract between the German construction company Dywidag and the Thai government in the 1990s to construct the Don Muang Tollway. The insolvency administrator for the Walter Bau construction group is demanding over ¤30 million from the Thai government because of a payment that was apparently never received in return for Dywidag's work on the 26 kilometre road. Dywidag merged with Walter Bau in 2001. In 2005, Walter Bau went insolvent and was partially acquired by an Austrian company.


After the construction of the highway, a legal row erupted, with the German construction company saying contractual obligations had not been met. After years of negotiations, an international court in Geneva awarded Walter Bau US$42 million (Bt1.26 billion) in compensation, a decision the Thai government rejected.


This contractual dispute has now become political and caused bilateral irritations. It goes without saying that legally binding contracts have to be fulfilled by all parties concerned. This is the fundamental principle of such contracts. However, legal disputes over highly complicated construction contracts such as building highways or other public mega-projects are far from uncommon. Big contracts of this sort between governments and contractors are often disputed, or have to be renegotiated, even after they have been signed and the project completed.


[color:red]However, the seizure of a royal aircraft goes far beyond being a reasonable approach to settle such a dispute.[/color]


There are several question marks over how this issue has been dealt with on the company's side: first of all, the seizure of a plane from a royal fleet is simply not the most straightforward approach.


One cannot help thinking that the insolvency manager went for the most sensational approach. Seizing a plane from the Thai royal fleet guarantees media attention and exposure. It is questionable whether causing bilateral irritation to such an extent is helping to solve the legal issue, which concerns, after all, a private contract between a company and a government.


[color:red]Further, it is surprising that the insolvency manager went for an aircraft under royal service. The initial contract between Walter Bau was with the Thai government. Thailand is a constitutional monarchy in which the government, elected by the Thai people, governs the country. HM the King is the head of state and represents the country. The construction contract was therefore between Thailand and Walter Bau, and not with the Royal Family.[/color]


The approach of the insolvency administrator would only make sense if the plane belonged to the Thai government. But the legal ownership of the plane is far from clear. A simple look at the plane reveals the words "Royal Flight". The plane also carries royal insignias.


But while the identity of the aircraft's owner may remain unclear, the action of seizing a vehicle used by a member of the Royal Family exceeds all bounds of a reasonable approach towards a solution. The damage is done.


The Thai side tried to solve the issue on a political level last week. Foreign Minister Kasit flew to Germany where he met with Cornelia Piper, an under secretary of the German foreign ministry. The German side does not want to intervene in the case and refers to the independence of the judiciary.


A German court subsequently declined the Thai government's request for an injunction to release the plane held at Munich Airport. The judge said the court was not fully convinced the plane was HRH Crown Prince Maha Vajiralongkorn's personal property, as asserted by the lawyer for Thailand.


The Royal Thai Air Force (RTAF) confirmed the Thai government's contention that the RTAF in 2007 presented the Boeing 737 jet to the Prince for his personal use. RTAF spokesman Air Vice Marshal Monthon Satchukorn said last week that there is an official document to prove the presentation. The Foreign Ministry asked for that document to be presented to the German authorities and the RTAF has supplied that document," the spokesman said.


Meanwhile caretaker Prime Minister Abhisit Vejjajiva has tried to take the heat out of the situation by instructing the Thai Aviation Department to probe his suspicion that the German company's objections are based on out-of-date information that the plane is under the supervision of the RTAF. The PM also said that the German government expressed its regret about the case and is cooperating with Thai officials.


It is very likely the dispute will be settled soon. However, the avoidable damage caused to bilateral relations between Germany and Thailand is done, with both the economic and also political ties suffering.





Dr Alexander Mohr is partner for International Relations at the government relations firm Alber & Geiger in Brussels and was lecturer on International Relations at the French university Institut d'Études Politiques de Paris in France.



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Court shown evidence on ownership



A document showing [color:red]the withdrawal of an impounded Boeing 737 from the Defence Ministry's list of aircraft[/color] was among evidence presented to a German court to prove the plane's ownership, an informed source said yesterday.


[color:red]Other papers submitted included the Standard Certificate of Airworthiness, the aircraft registration and a permit to use private aircraft, all signed by HRH the Crown Prince Maha Vajiralong-korn when the Royal Thai Air Force presented the plane to him in 2007 for his personal use, the source said.[/color]


Civil Aviation Department director-general Somchai Chanrod said yesterday that the documents submitted to the court complied with the Convention on International Civil Aviation, or Chicago Convention. He expressed confidence the court would accept the Thai government's sound evidence that the Boeing did not belong to the government.





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