Abstract:
Presently, national governments are playing an increasingly important role in international trade and investment. For example, some States seek to strengthen their economy by allowing foreigners an opportunity to invest in public services and facilities traditionally controlled by the State granting in the form of permission or concessions. However, the aforementioned investment is not always successful due to disputes arising from a breach of contract when either party fails to comply with the agreed upon terms. When such a difference occurs, there are four dispute settlement methods currently available to the parties: negotiation, conciliation, arbitration, and judicial redress. Unless the first two methods have proved abortive, the aggrieved party would most likely seek a resolution through negotiation or mediation. Nevertheless, institution of any court proceedings in order to cope with this clash could cause another problem with respect to the reluctance of foreign private sectors to participate in a process which may result in inequitable and biased treatment under the jurisdiction of a domestic State court. In addition, States would be unwilling to subject themselvesto the jurisdiction of any other national court, as this would be deemed as an act tantamount to the surrender of its sovereignty. In light of such issues, the parties may select to resolve their disputes through arbitration, where the arbitrator will render an award which is normally binding on the parties. However, problems may arise precipitated by the losing side denying the effect of an arbitrator's ruling.Through painstaking and exhaustive research, it was discovered that the ambiguity regarding which method will be utilized by Thailand to end disputes and which laws will be used to enforce contracts combine to place a high risk on foreign investors if the State opts for a judicial solution. Even after the proper court maintains jurisdiction over cases regarding the State and applies the principle of public law. Unlike France, Thailand has not clearly established substantive legal system for the resolution of disputes through administrative court. Therefore, Thai judges are unlikely to go beyond the parameters of the Commercial Code when settling a contract dispute. The fear of bids in favor of the State of Thailand, combined with various defects contained in the Arbitration Act B.E. 2530, create an apparent barrier the resolution of to international trade and investment disputes.In order to solve the aforementioned problem, there has been a proposal on the accession of Thailand as a member to the International Center for the Settlement of Investment Disputes between State and Nationals of Other States (ICSID Convention 1966). JCSID is a neutral and independent, international organization whose primary function is to facilitate dispute settlement between parties in discord. The decision of any arbitrator issued in the course of operation of their duty and under the supervision of ICSID is ostensibly equivalent to the final judgment of an administrative court and binds the losing party to the arbitrators decision.To put the above mentioned problems to an end, Thailand must accede to the Convention, as well as enacting and implementing laws in accordance with theConvention. Additionally, Thailand must amend Arbitration Act B.E. 2530, in order to rectify any shortcomings in the text so that the Convention will become developed to the fullest extent as a universal institution encouraging a favorable climate for international investment and will be a center for the resolution of any future regional disputes over trade, investment or production.