Understanding how Thai law looks at bribery, gift-giving and appropriate controls

Under Thai law, the act of bribery could be a criminal offense.[1] Key principles of the offense are as follows:

1. The act of bribery means to give, offer, or promise to give any property or other benefits.
2. Such benefit or property must be offered to a public official.[2]
3. The benefit or property must be offered to the aforementioned official with the intent to persuade the official to wrongfully perform, not to perform, or delay the performance of any duty of the official’s office.
4. If the offense of bribery is established, the individual found guilty will be subject to an imprisonment sentence not exceeding five years and/or a fine not exceeding THB100,000.

Further observations on the offense:

• Offering a benefit or property to an employee of a private sector is not considered a bribery offense, but may instead be considered a breach of internal policy, and would only lead to, eg, a disciplinary sanction, employment termination, and/or breach of contract.
• If bribery takes place, the intermediary[3] who connects the briber to an official may also be subject to an offense, along with the official.[4]
• If an offense of bribery is committed by an associated person[5] having any relation to a private entity[6] and the bribe was taken for the benefit of such entity, the entity will be subject to a fine of one to two times the damages caused, or the benefit received.
• An entity may have an affirmative defense to an allegation of bribery, if the entity can prove that it had implemented appropriate internal control measures to prevent the commission of bribery.

Appropriate internal control measures

The National Anti-Corruption Commission has issued guidelines for the determination of internal control measures appropriate for legal entities to prevent bribery, as follows:

• strong policy and support from top-level management to fight bribery
• risk assessment to effectively identify and evaluate exposure to bribery
• enhanced and detailed measures for high risk and vulnerable areas
• application of anti-bribery measures to business partners
• accurate books and accounting records
• human resources management policies complementary to anti-bribery measures
• communication mechanisms that encourage reporting of suspicion of bribery andperiodic review and evaluation of anti-bribery prevention measure and their effectiveness.

Giving gifts to public officials

Thai law also regulates the giving of gifts or benefits by any persons to public officials.[7] “Gifts or benefits” includes, but is not limited to, discounts, entertainment, service, meals or the equivalent.

The criteria for a  public official to accept gifts or benefits are as follows:

Giving a gift or benefit, regardless of the value, to a public official is not considered an offense of bribery, unless it is given with an intent to solicit a benefit in kind may be considered an offense of bribery, as discussed above.

Reporting channel for foreign investors

Foreign investors may report[8] the conduct of an official to the Complaint Center for Foreign Investors (CCFI), a report-recipient arm under the Office of Public Sector Anti-Corruption Commission (PACC), when faced with:

1. An official’s failure to comply with the Licensing Facilitation Act[9]
2. An official’s conduct that causes nuisance or damages to the public and/or
3. An official’s conduct that causes severe detriment to government services.

The PACC may take the following actions upon a report:

• Notify the relevant government agency of the report. The government agency will conduct internal investigation on the issue, and notify the outcome to the PACC within 60 days and
• Where action is required, the government agency will notify the PACC of how long the actions will take. If the government agency fails to comply with such timeline without reasonable cause, the PACC shall take further actions as required.

The procedure has yet proven to provide an effective sanction, measure, or relief for the reporting foreign investor. In principle, the CCFI/PACC plays only a liaising role with other government agencies.

Over time, the procedure will likely see further amendments to bolster the CCFI/PACC’s authority.

Find out more about the work of the CCFI and PACC in Thailand and the implications for your business by contacting any of the authors.