How Class Actions Thailand Introduced in 2015 Actually Work
Class actions Thailand law now permits let thousands of small claims combine into a single case — but unlike the U.S., Thai defendants won’t be required to hand over evidence that hurts their own case.“Class actions” are coming to Thailand, and they have the potential to significantly reshape civil litigation and corporate practices in the country.
Class actions are lawsuits that combine the claims of numerous claimants — often in the thousands or more — against one or a few defendants. They are cases that would generally never be brought under ordinary court procedure, either because the number of claimants is too large to manage individually, or because each claim is too small to justify the cost of litigating it alone, or both. Class actions solve both problems by allowing such claims to be consolidated and managed as a single case, creating an aggregate claim large enough to justify the litigation expense.
Typical hypothetical examples might include a bank or telecom provider overcharging each customer an unjustified fee of THB 1,000, or a car manufacturer or pharmaceutical company producing a defective product that harms consumers. Successful class action litigation provides justice to claimants and creates an incentive for responsible corporate behavior that has not previously existed in Thailand.
Thailand is introducing this mechanism through the Act Amending the Civil Procedure Code of Thailand (“CPC”) (No. 26). The Act was published on 8 April 2015 and takes effect on 4 December 2015, adding 49 new sub-sections to the CPC governing class actions. Under the Act, a “Class Action” is a court proceeding in which a Plaintiff pursues their own interests as well as those of others forming a “Class” of similarly situated people. A “Class” is defined, in part, as a group of persons sharing identical rights arising from common issues of fact and law, along with identical characteristics specific to the Class.
To initiate a Class Action, a Plaintiff must file their own case and separately request that the Court certify it as a Class Action for the benefit of other Class Members. The scope of eligible cases is broad, covering torts, breaches of contract, and “any other claims relating to other laws.” Based on the examples the Act provides, it appears the intent is for Class Actions to apply to most, if not all, civil matters — though not to family, intestate succession, criminal, or other matters not traditionally treated as strictly civil.
Once requested, the Court will permit the case to proceed as a Class Action if it finds that:
- The case and underlying allegations are clear and apply equally to the Plaintiff and the Class Members;
- The Plaintiff has demonstrated sufficient, specific, and identical characteristics shared by the Class;
- The number of Class Members is so large that proceeding under ordinary CPC procedure would be unworkable;
- A Class Action would deliver justice more efficiently than ordinary procedure; and
- The Plaintiff has sufficiently shown they are a Class Member meeting the Act’s qualifications, and that the Plaintiff and their lawyer will represent the Class effectively and fairly.
The Act requires that all Class Members be notified of the action by mail, publication, or other media the Court deems appropriate. This notice is essential, since it informs Class Members that — unless they formally opt out — they will be bound by the outcome of the case, whether favorable or not. It also informs them of their rights to participate.
However, while the Act calculates the court filing fee based only on the Plaintiff’s own claim, it also requires the Plaintiff to deposit funds covering the Class Action’s broader court-related expenses. This requirement could become a real obstacle: if a Plaintiff is poorly funded — potentially even as a result of the defendant’s own conduct — and the Class is large, the Plaintiff may be unable to cover the cost of notifying all Class Members. In that scenario, the case would be dismissed without the underlying claims ever being resolved, regardless of their merit.
One feature of the Act that may help address this funding gap is its provision for lawyer compensation. If the Plaintiff prevails, the Court determines the amount payable to the Plaintiff’s lawyer based on the lawyer’s submission of fees and expenses. Where the judgment includes a monetary award, the Court may award the lawyer fees and expenses up to 30% of that award — though the Court may not reimburse costs the lawyer advanced on the Plaintiff’s behalf, such as the Plaintiff’s deposit for court expenses.
It’s plausible that well-funded law firms will step in to finance promising Class Action cases where Plaintiffs themselves cannot. Whether Thai court judgments and the resulting fee structure will justify this kind of pre-financing, however, remains to be seen — particularly in cases where the Plaintiff cannot cover the court’s expenses.
Where the Act is silent, the CPC’s usual procedural rules apply, including its rules on evidence. In Thailand, each party submits evidence independently to support its own case — this is not necessarily how things work elsewhere.
In the United States, for example, where the modern class action originated decades ago, parties — including defendants — must disclose all evidence relevant to a case, even evidence harmful to their own position. Since the maker of a defective product or provider of a deficient service is often the party most likely to possess evidence of that very deficiency, this discovery rule has historically driven many successful class action outcomes against harmful product and service providers in the U.S.
That rule does not apply in Thailand. It remains to be seen how effective Thai Class Actions will prove to be, given that defendants will generally only be required to produce evidence favorable to their own case.
Finally, the Act leaves considerable discretion to the courts through several broad provisions, but it also empowers the President of the Supreme Court of Thailand to issue implementing regulations. We would therefore expect initial regulations detailing the Act’s practical implementation to be issued before its effective date in December 2015.
While there remain open questions about how the Act will function in practice and how effective it will prove at achieving its intended goals, the introduction of this modern legal mechanism should overall be viewed as a positive contribution to litigation, corporate practice, and the public interest in Thailand.
Businesses operating in Thailand should closely monitor how class actions Thailand courts begin certifying develop in practice once the Act takes effect, since the combination of aggregated claims and lawyer contingency-style compensation could meaningfully increase litigation exposure for companies with large customer bases.