Contracts in Thailand

A contract is deemed to be concluded and binding where the offer is accepted and the acceptance is communicated from the offeree to the offeror. It is an exchange of promises between two or more people for a particular purpose to do or not do something as a legally enforceable agreement.

Agreements are made by the parties that describe the privileges, obligations and duties of the parties. A ‘Party’ can mean an individual person, company or corporation. All contracts shall be given in the form of a written document signed by the parties. Please note that no matter what kind of contract you take, having an understanding of contract details is very important because once you have signed the contract, it is lawfully enforceable and you have to abide by what is said in the contract.

For foreigners who wish to enter into the contracts, the agreements are still enforceable in Thailand as long as the purposes are not prohibited by Thai law or impossible or contrary to public orders or good morals. Once a foreigner has already entered into a contract, if there was no mention of which law should govern the contract and if the parties are of the same nationality, the laws of the country of nationality will apply. If the parties are not of the same nationality, the law of the country where the contract has been made will apply. In case a contract has been made between parties at a distance, the country where the contract is deemed to have been made is the country where notice of the acceptance reaches to the offeror. If such a place cannot be determined, the law of the country where the contract is to be performed shall govern.

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