Mahanakorn Partners Group Co

Introduction The electric vehicle (EV) industry is central to the global shift towards sustainable, greener transport, and Thailand's Board of Investment (BOI) is working strategically to establish the country as a key player in the EV supply chain. The recent AION Sourcing Day, in partnership with Chinese EV manufacturer GAC AION, aimed to integrate Thai parts manufacturers into the global EV market, boost domestic production and foster international collaboration. I. Thailand's EV Policy and Boi Incentives The BOI is supporting Thailand’s EV industry through various incentives designed to attract foreign investment and enhance local capabilities to help Thailand to become a regional EV hub while still meeting environmental sustainability goals. Key initiatives include: Corporate Income Tax Exemptions: EV manufacturers and parts producers are eligible for tax holidays of up to 8 years. Import Duty Reductions: Exemptions or reductions are provided for imported machinery and raw materials used in EV production. Infrastructure Development Support: Investments in EV infrastructure, such as charging stations and battery facilities, are actively encouraged. Technological Cooperation: Joint ventures and technology transfer agreements between foreign investors and local manufacturers will be encouraged to strengthen domestic capabilities. These measures are in line with the Thai government’s 30@30 policy, which aims to achieve 30% zero-emission vehicle (ZEV) production by 2030. II. GAC AION’S Role in Thailand GAC AION’s investment in Thailand includes the establishment of a production base in the Amata City Industrial Estate, Rayong Province with an investment of over 5.6 billion baht, aimed at creating an export hub for EVs in the ASEAN region. The company’s phased investment strategy will integrate Thai parts manufacturers into its supply chain and strengthen Thailand’s role as a regional manufacturing hub. It will also align its operations with Thailand's environmental goals by prioritizing the production of ZEVs. AION Sourcing Day and Domestic Integration The event focused on the sourcing of key components such as interior, exterior, electrical, and battery parts. The event sought to generate more than 2.25 billion baht in domestic component purchases, creating substantial opportunities for local manufacturers to join the EV supply chain. GAC AION’s decision to prioritize Thai manufacturers is driven by their high-quality production, cost efficiency through reduced transportation costs and streamlined logistics, and improved after-sales service. This collaboration provides Thai manufacturers with access to GAC AION’s global supply chain, promotes technology transfer to share knowledge through collaboration, and stimulates local economic growth and labor market support. III. Legal and Regulatory Considerations Accessing BOI incentives To access BOI incentives, companies must meet certain compliance requirements: Local Content Requirements: To benefit from tax and duty exemptions, a specified minimum percentage of components must be sourced locally. Environmental Standards: Manufacturing processes must adhere to Thai environmental regulations, including compliance with emission standards and proper waste management practices. Investment Thresholds: Companies must reach specified minimum investment thresholds to qualify for incentives. Promoting Technology Transfer and Intellectual Property Protection In addition, the BOI encourages partnerships between foreign investors and local manufacturers for technology transfer as part of the incentive program. However, the investors must comply with intellectual property (IP) regulations. The key factors to consider are: Licensing Agreements: Establishing fair licensing terms for shared technologies. IP Protection: Safeguarding proprietary technologies while encouraging innovation. Developing local talent for Thailand’s EV sector Thailand’s labor laws mandate prioritizing the hiring and skill development of local workers. To support the EV industry, the government has launched training programs and fostered partnerships with educational institutions to develop a skilled workforce for advanced manufacturing roles. IV. Opportunities and Challenges Opportunities Industry Leadership: Thailand is strategically positioned to emerge as a leader in EV manufacturing and exports within the ASEAN region. Economic Development: Increased investments in EVs and related industries will stimulate GDP growth and create new employment opportunities. Environmental Progress: The shift to ZEVs contributes to reducing greenhouse gas emissions, supporting global sustainability objectives. Challenges Supply Chain Integration: Local manufacturers must achieve global quality standards to effectively participate in the EV supply chain. Regulatory Compliance: Meeting stringent environmental and labor regulations can require significant resources. Global Competition: Thailand faces stiff competition from regional players like Indonesia and Vietnam, which are also seeking to attract EV investment. Conclusion The partnership between the BOI and GAC AION marks a crucial step in Thailand's progress towards establishing itself as a leading EV hub in the region. By incorporating local parts manufacturers into the EV supply chain, this initiative will boost economic development while solidifying Thailand’s standing in the global automotive market. However, realizing these ambitions requires careful management of legal, regulatory, and operational challenges.

Introduction The integration of artificial intelligence (AI) with neurotechnology is driving transformative innovation, but it also poses significant legal and regulatory challenges for businesses operating in the sector. While much attention has been paid to AI-related regulation, healthcare law remains critical in this area, particularly as its legal importance grows in regions such as the US, EU, and clinical centers such as Thailand. As the field of AI neurotechnology advances, companies face critical legal and regulatory hurdles related to data privacy. The following analysis examines the current environment and the key factors that companies need to consider in this dynamic sector. I. Data Privacy in AI Neurotechnology Neurotechnology, from a biomedical standpoint, refers to techniques and tools that create direct links between technical systems - such as electrodes, smart prosthetics, and computers - and the human nervous system. These systems generate highly sensitive data related to an individual's identity, emotions, and thoughts. The incorporation of AI into neurotechnology further intensifies this sensitivity by enabling the extraction, simulation, and manipulation of brain data. Regulatory Landscape Increased awareness of data privacy has led to the development of regulations such as the Health Insurance Portability and Accountability Act (HIPAA) in the United States and the General Data Protection Regulation (GDPR) in the European Union which cover sensitive data, including that generated by AI neurotechnology. Similarly, Thailand's Personal Data Protection Act (PDPA) classifies such biometric data as sensitive, requiring explicit consent for its collection and processing. However, compliance remains a challenge due to different laws in different jurisdictions, including the lack of AI-specific regulations in Thailand. Region Regulations Key Compliance Requirements Relevant Actions for Companies EU GDPR (General Data Protection Regulation) Data subject rights (eg. consent, access, erasure) Data protection by design and by default Accountability and documentation Implement privacy-by-design measures Conduct Data Protection Impact Assessments (DPIAs) Ensure data subject rights are respected US HIPAA (Health Insurance Portability and Accountability Act)CCPA (California Consumer Privacy Act) Secure health data and medical records Provide transparency on data collection Consumer rights to opt-out and deletion Encrypt sensitive health data Create clear privacy notices Implement access control for medical data Thailand PDPA (Personal Data Protection Act) Biometric data is considered a "special category of personal data" Explicit consent required for collection of biometric data Appoint a Data Protection Officer (DPO) Conduct regular audits of data protection practice II. Key Challenges For Companies Data Sensitivity Neurotechnology systems collect deeply personal data, which presents distinct and complex challenges for data protection and privacy. To reduce risk, companies should: Deploy strong data anonymization and encryption measures. Limit data retention durations and promptly delete unnecessary information. Ensure that data use complies with ethical standards and privacy regulations, especially for personal or biometric data. Cross-Jurisdictional Compliance Companies face complexities in complying with different international data protection regulations. In Thailand, the lack of AI-specific legislation adds complexity for neurotechnology companies seeking to comply. Moreover, cases such as Thailand's recent decision to deny copyright registration for AI-generated works due to insufficient human involvement underscore the potential legal challenges associated with AI-generated or modified data. To navigate these, companies should: Develop global compliance strategies. Consult international legal experts in AI, data privacy, and intellectual property. Continually update compliance policies to keep pace with evolving regulations. III. Strategies for Proactive Compliance Engage Legal Experts Monitor evolving legislation such as GDPR, HIPAA and PDPA with professional legal support to ensure cross-jurisdictional compliance. Adopt Privacy-by-Design Build privacy protections into AI neurotechnology systems from the start by: Performing regular security audits to detect and resolve potential vulnerabilities. Using encryption and anonymization to protect sensitive data. Obtaining informed consent with transparent terms and conditions. Creating transparent agreements that outline intellectual property rights for AI-generated output. Providing users with control over data with clear privacy settings. Maintaining detailed records of data processing activities and conducting regular compliance assessments. IV. Outlook On Compliance The fast-paced development of AI neurotechnology requires a proactive and strategic approach to regulatory compliance. Companies must balance innovation with strong privacy safeguards, ensuring the ethical and responsible management of sensitive neurotechnology data. By building strong compliance frameworks and collaborating with legal professionals, companies can lead responsibly in this transformative sector, protecting both individual rights and sensitive data.

Introduction Thailand's Securities and Exchange Commission (SEC) has identified the necessity for a thorough overhaul of its regulatory framework to keep pace with evolving socio-economic conditions, technological progress, and the dynamic nature of private sector innovation. Current laws have faced criticism for their ambiguity, lack of alignment with global standards, and insufficient mechanisms to enforce criminal liability in areas such as securities, derivatives, and digital assets. I. Key Draft Regulations The SEC has drafted four major new regulations to modernize the capital markets framework. Draft Securities and Exchange Act Draft Derivatives Act Draft Trust for Transactions in Capital Market Act Draft Act to Amend the Royal Decree on Digital Asset Business These changes are designed to promote transparency, remove barriers, and establish robust legal mechanisms in line with international standards, benefiting operators, investors, and the public. No. Topic Details 1 Promoting the Digital Capital Market Amendments to fully support electronic processes in the market New regulations for service providers crucial to capital market operations 2 Supervision of Securities and Derivatives Business Operators Enhanced supervision of major shareholders of business operators. New provisions for supervising personnel involved in securities and derivatives businesses. Mandatory announcement of financial statements. Business dissolution procedures in the event of license revocation. 3 Supervision of Secondary Markets and Related Organisations New provisions to reduce restrictions on the establishment and operation of trading centers. Additional regulatory measures to enhance supervision and operational efficiency. New provisions for investments in securities offered by associations. 4 Fundraising and Auditing Firm Supervision Improved regulations for the issuance and offering debt instruments. Clear guidelines on mergers and acquisitions(M&A) Supervision of auditing professionals 5 Low Enforcement and penalties for Non-Compliance Designated authority for SEC officers to investigate specific offenses New measures to align securities 6 Regulatory Bodies under the SEC New requirements and prohibited characteristics for SEC expert committee members Clarification that SEC is not governed by social security laws   Figure 1. Proposed Draft of the Securities and Exchange Act.   No. Topic Details 1 Electronic Processes in the Capital Market New provisions enabling operations and processes to be conducted electronically. Legal recognition of the validity of electronic transactions in the capital market. 2 Supervision of Derivatives Business Operators and Related Entries Revised regulations for supervising derivatives business operators, secondary markets, and associated organisations. Mandatory requirements for derivative advisors to maintain accurate records and disclose operating results and financial status Enhanced supervision of other market participants, including investment advisors, planners, analysts and contract managers 3 Witness Protection Measures Additional safeguard for witness during investigations and evidence collection in criminal cases. Protection from civil and criminal liability, except for individuals directly involved in the wrongdoing 4 Investigate Authority of SEC Officials Authority grated to SEC officials to act as investigative officers for handling specific offenses.   Figure 2.Proposed Draft of the Derivatives Act.   No. Topic Details 1 Electronic Processes in Capital Market Introduction of new provision enabling various operations and processes to be conducted electronically. Legal recognition of the validity of electronic transactions in capital markets 2 Witness Protection Measures Enhanced protections for witnesses during examinations and evidence-gathering processes conducted by authorities in cases involving serious crimes. Witnesses will be granted protections as outlined in relevant laws governing protection in criminal cases. Safeguard against criminal and civil liability for witnesses who provide factual information, evidence, or documentation in good faith to the SEC, with exemptions for individuals directly involved in the offense.   Figure 3.Trust for Transactions in Capital Market Act and Draft Amendment to the Royal Decree on Digital Asset Business.   II. Preparing Businesses For Regulatory transition Adapting to SEC’s proposed regulatory updates requires businesses to take proactive steps to ensure compliance and capitalize on emerging opportunities. Here are key recommendations: 1. Familiarize yourself with the Regulations Thoroughly review the proposed legislation and, if necessary, consult with professionals to fully understand its implications and compliance requirements. 2. Assess Current Practices Conduct a comprehensive evaluation of your existing operations and policies. Identify areas that may need to be adjusted to comply with the upcoming regulations. 3. Train Employees Improve workforce readiness by offering training programs or organizing in-house sessions to ensure employees are equipped to understand and effectively implement the new standards. 4. Engage with Authorities Foster open communication with regulatory bodies to seek clarification, offer feedback, and establish cooperative relationships that support compliance efforts. 5. Monitor Implementation Timelines Stay updated on regulatory timelines, including the effective dates of new provisions, and plan accordingly to ensure changes are implemented on time. 6. Prepare for Enforcement Strengthen your compliance framework by creating a response plan. Maintain detailed records and documentation to demonstrate adherence to the updated regulations during audits or reviews. III. A leap forward for Thailand's Capital Market The SEC’s draft revisions represent a major step toward modernizing Thailand’s capital market. By bridging existing gaps and aligning with international standards, these updates aim to create a more transparent, efficient, and competitive financial ecosystem. Businesses that actively prepare for these changes not only secure compliance but also gain a strategic advantage in navigating an evolving regulatory landscape.

I. INTRODUCTION Thailand’s main legal piece of legislation governing personal data protection is the Personal Data Protection Act B.E. 2555(2012) (“PDPA”). The PDPA bestows power to the Personal Data Protection Committee (PDPC), the key regulator, to enact sub-regulations, including announcements and ministerial regulations, to provide guidelines, requirement and additional details to set Thailand’s standard of personal data protection to be as impressive as its European Model; the GDPR. With a few adjustments, the PDPA was designed to accommodate the Thai environment and to support the country’s stepping into the digital era. The two main types of personal data protected under Thai law includes: General Personal Data (as defined in Section 6 of the PDPA) like names, contact details and similar information – requiring standard protection measures. Sensitive Personal Data (as implied in Section 26 of the PDPA) like health data, religious beliefs – demanding stricter safeguards and explicit legal justification for collection and use II. REGULATORY UPDATES The new announcement in 2022, Announcement Regarding the Criteria for Consideration of Issuing Orders and Administrative Fines ordered by the Expert Committee B.E. 2565 (2022), was enacted by the PDPC to extend the scope of assessing penalties imposed on the data controllers, processors and other individuals committing violation of the PDPA. The key criteria for assessing the extent of the penalty includes: Intent, negligence, or carelessness in preventing data protection failures Severity of the offense and scale of operations of the data processor and data controller Financial impact on the offenders and benefits received as a result of the penalty by the data subjects whose rights have been violated Past offenses and efforts to mitigate the adverse impact on the data subjects after the breaches has occurred. II. RESPONSIBILITIES OF DATA CONTROLLER AND DATA PROCESSOR A data controller is defined as a natural or juristic person with the authority to make decisions regarding the collection, use or disclosure of personal data. A data processor is defined as a natural or juristic person that processes personal data based on the instructions given by the Data Controller. The relationship between the two mentioned positions is via a contractual agreement, whether that be a direct employment contract or an outsourced service agreement. The main duties owed by the Data Controller are as follows: Manage personal data responsibly Collect data based on lawful basis, especially for criminal records with limited permissible circumstances and the subsequent additional obligations imposed on the Data Controller to collect criminal records of data subjects. Ensure that third parties receiving the personal data are processing it sensibly, lawfully and take actions to prevent unauthorized access or use Report to the authorities the data breaches within 72 hours after knowing to the breach Additional obligation to notify affected individuals if high risks are posed Appointment of a Data Protection Officer (DPO) in accordance with the rules and guidelines of the PDPA Maintain Records of Processing Activities (ROPA) ready for inspection by the PDPC (subject to certain exemptions) For international data transfers, the Data Controller must ensure that the destination countries meet Thai PDPA-equivalent data protection standards. Alternatively, Binding Corporate Rules (BCRs) can be used in place for intra-group transfer of personal data. The basic requirements must also be met e.g. lawful basis for collecting personal data, risks assessment and documentations. The main duties owed by the Data Processor are as follows: Implement robust technical and organizational security measures Regularly updating security measures to accommodate technological changes and developments Report to the authorities the data breaches within 72 hours after knowing to the breach Appointment of Data Officer (DPO) in accordance with the rules and guidelines of the PDPA IV. PENALTIES FOR NON-COMPLIANCE The three kinds of penalties a data controller, data processor or other individuals violating the PDPA may be subjected to includes civil, criminal and administrative liabilities. Civil liability – payment of compensation for damages and expenses Criminal liability – imprisonment from 6 months to 1 year, and fine ranging up to 1,000,000 Thai Baht, liability extended to the representatives if offender is a juristic person Administrative liability under the PDPA – fines ranging up to 5,000,000 Thai Baht Landmark case: JIB Thailand JIB, a prominent Thai IT distributor with annual revenues over 6 billion Thai baht, was fined a total of 7 million Thai Baht for violating three key principles of the PDPA, including: Inadequate security measures (stipulated by Section 37(1) of the PDPA) Failure to notify the PDPC promptly (stipulated by Section 37(4))) Delay in appointing a Data Protection Officer (DPO) (stipulated by Section 41 (2)) The penalties do not only include punitive damages, which was charged at the maximum rate specified by the PDPA, but also administrative orders to overhaul its data protection framework within 30 days, to implement enhanced safeguards, and to keep the PDPC updated weekly. JIB has declared via a Facebook post of their commitments and efforts to achieving this. Whilst the penalties are relatively gentle when examining JIB’s revenue and profit margin, it teaches both the business operators the importance of PDPA compliance and the damages it has financially and reputationally once violated. The consumers are also now aware of their rights and will be sure to enforce it when necessary. V. CHALLENGES AND COMMON MISTAKES Simply asking businesses to comply with the PDPA is easier said than done. In fact, business operators have faced many challenges when attempting to align their practices with the standards required by the PDPA. Data mapping is one of the biggest challenges, as businesses, especially large enterprises dealing with large amounts of data, finds it difficult to track the flow of data through their organizations, from input to storage. Resource constraints also prove to be one of the obstacles to compliance as limited budgets, manpower and training efforts are problems commonly faced by companies. Updating the IT system and integrating measures to ensure compliance is also very costly and time-consuming. Common mistakes operators make in relation to the compliance to the PDPA includes poor consent management, lack of documentation to handle data processing, weak access controls and insufficient encryption, and failure to manage the actions of a third-party processor. VI. SUSTAINING COMPLIANCE Whilst difficult, it is legally required for companies to have the measures, systems and training in place in order for processing of personal data to be part of their operation and business practice. Whether it be for marketing purposes or others, companies can take the following steps for long-term compliance: Integrate compliance measures into daily operations Set up an automatic system for repetitive tasks like consent management and data destruction upon request Regular employee training Implementing a centralized data management tool Perform periodic audits and prepare a ready-to-use plan to deal with future breach incidents. VII. CONCLUSION The PDPA is a crucial piece of legislation designed to protect personal and sensitive data in the country data, aligning with global standards set by the GDPR. With updates in recent years, the PDPA now offers clearer guidelines for businesses on how to manage data, including requirements for data controllers and processors to implement robust data protection measures. The regulatory framework not only outlines responsibilities but also imposes penalties for non-compliance, reinforcing the importance of adhering to data protection principles. However, businesses still face significant challenges in achieving full compliance with the PDPA. Common obstacles include resource constraints, the complexity of data mapping, and difficulties in updating IT systems. To ensure sustained compliance, companies must integrate data protection measures into their operations, invest in employee training, and regularly audit their systems. By taking these proactive steps, businesses can minimize the risks associated with data breaches and demonstrate their commitment to safeguarding personal information Therefore, it is crucial for businesses to engage legal consultants and technical experts to assess their current systems for compliance with the PDPA. This evaluation will help identify any gaps and ensure that necessary changes are implemented to meet regulatory requirements. Seeking professional assistance at this stage is essential to mitigate risks and ensure ongoing compliance.

INTRODUCTION Public-Private Partnerships (PPPs) has become an internationally discussed topic as it provides solutions to meet the growing demand for infrastructure development, most prominent in the areas of emerging markets. PPPs allow the public sector to tap into the private sector expertise, innovation and financing capabilities. One of the forms of PPPs are ones structured around availability payment, a model particularly suited for projects where revenue generation is either uncertain or unfeasible. I. AVAILABILITY PAYMENTS IN PPPs Availability payments are a financing model where the private partner is compensated based on the performance of infrastructure assets rather than user-generated revenues like tolls or users’ fees. The structure is most appropriate for projects where revenue generation is either insufficient or unpredictable, but where public access is vital. Availability payment PPPs differs from user-fee based PPPs as the private sector partner does not assume revenue risk by collecting payments directly from users. In an availability payment model: The private sector partner is responsible for designing, building, financing, operation, and maintaining the infrastructure. The public sector partner makes periodic payments depending on the availability and the performance standards, not on the volume of users or toll collection The government retains control over user charges if applicable, but the private partner is incentivized to meet the set quality and service benchmarks. III. ADVANTAGES OF AVALABILITY PAYMENT STRUCTURES The advantages of choosing a PPP structure based on payment structures ae as follows: Risk transfer - Availability payment models effectively transfer design, construction, and operational risks to the private sector. However, the public sector retains control over demand-related risks (e.g., fluctuating toll revenues). This is ideal in cases where the potential for revenue generation is uncertain or unlikely Incentivized performance - Private partners are motivated to meet high standards of quality and operational performance because their payments are directly linked to their ability to meet availability and service requirements. This ensures that the infrastructure is maintained to a high standard. Budget certainty - Availability payments are typically pre-agreed and structured over long-term contracts. This provides the public sector with predictable, long-term budgetary obligations, which are particularly valuable in long-term infrastructure planning. Faster project delivery – due to payments being contingent on the timely completion and operational readiness of the project, private partners have a strong incentive to complete projects on schedule and within budget, speeding up delivery. III. Challenges and considerations for PPPs in Thailand While availability payment PPPs have clear advantages, they are not without challenges: Higher Private Financing Costs Private financing for PPPs typically carries a higher cost than public borrowing. The success of availability payment structures hinges on whether efficiency gains in design, construction, operation, and maintenance outweigh the additional cost of private financing. Risk of Underperformance If the private partner fails to meet availability or performance standards, the public sector may reduce payments or terminate the contract. This risk can be mitigated through rigorous due diligence and well-designed contracts that clearly define performance metrics. Regulatory certainty While the PPP Act lays a solid foundation, regulatory certainty is crucial, especially for long-term contracts. Investors need confidence in Thailand’s legal and regulatory environment to commit to large-scale projects, which requires a stable and predictable policy landscape. Political stability Long-term infrastructure projects, particularly those involving availability payments, are sensitive to changes in government policies. Political stability is pivotal for fostering investor confidence in such projects. Institutional capacity Effective PPPs require strong public sector capacity for contract management and oversight. Thailand must continue to build institutional expertise in managing complex PPP contracts, especially those with availability payment structures. IV. PPPs in Thailand Thailand has increasingly embraced PPPs as a means of addressing its infrastructure needs. The Public-Private Partnership Act B.E. 2562 (2019) provides a legal framework for PPPs, establishing procedures and guidelines for structuring these partnerships. Availability payments could be highly beneficial for several key infrastructure sectors in Thailand, where user fees are not viable, or the revenue is uncertain: Mass transit systems Thailand's growing urban population and expanding mass transit systems make availability payment structures an attractive option. For instance, in Bangkok, where public transportation systems like the Skytrain and MRT are vital but do not generate enough revenue to cover operating costs, availability payment PPPs could enable private partners to manage the construction and operations while the government retains control over fares. Healthcare infrastructure Public healthcare facilities often struggle to generate sufficient revenue through user fees. Availability payments could be used to finance the construction and operation of public hospitals, with payments tied to the availability and performance of these facilities. Educational infrastructure Education infrastructure in rural areas or underserved regions often faces financial constraints. Availability payment frameworks could provide a solution, similar to how the model has been successfully implemented in countries like the UK and Canada for schools and universities. V. BEST PRACTICES FOR STRUCTURING AVAILBILITY PAYMENT PPPS To ensure the success of availability payment PPPs in Thailand, the following best practices should be considered: Clear performance metric – defining clear and measurable performance standards to incentivize private partners to maintain the highest standards of the infrastructure. In-depth Value-for-Money (VfM) analysis – to compare the cost-effectiveness of a public procurement approach versus a PPP. The analysis should include financing costs, efficiency gains, risk transfer, and lifecycle costs. Transparent procurement process – to attract high-quality bids and ensuring the public sector gains the most from the beneficial characteristics of the private sector. Risk allocation – private sector should bear the risks associated with construction and operations, while the public sector retains control over demand and policy-related risks. VI. CONCLUSION As Thailand continues to develop its infrastructure to meet the needs of its rapidly growing economy, PPPs will play an increasingly important role. Availability payment models offer a flexible, performance-based solution to finance and deliver essential infrastructure projects, particularly where revenue generation is uncertain. By leveraging global best practices, conducting thorough VfM analyses, and ensuring a stable regulatory environment, Thailand can attract private investment and successfully implement large-scale infrastructure projects. Availability payment PPPs, when properly structured and implemented, provide a promising pathway to overcoming the financing challenges of infrastructure projects, ensuring that Thailand can continue to grow and prosper in the coming years.

INTRODUCTION Thailand is making a significant improvement in its environmental policy by introducing the key legislations, laying down the foundations for many guidelines and regulations in the near future, with the introduction of the Draft Climate Change Act. The draft consists of 14 chapters and a transitional provision, covering topics like the climate change fund, charter plan, greenhouse has, carbon emissions, carbon tax, carbon credit. With the closing of the public hearing on 21 November 2024, the draft Climate Change signifies Thailand’s commitment to a cleaner future. I. CARBON TAX Amongst other regulated activities, the carbon tax mechanisms, whereby the government collect taxes from businesses and organizations based on the greenhouse gas (GHG) emissions generated by their activities, will be implemented to the fullest extent with clear guidelines stipulated in the draft Climate Change Act. The scope includes industries such as electricity generation, wastewater treatment, waste management, transportation using fossil fuel, raw material sourced from deforestation, and the use of industrial machinery. Carbon tax will be calculated based on the volume of carbon emitted as a result from the entire process, starting with the sourcing of raw materials to deliver to consumers. The gases used in the calculation include carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), and other fluorinated gases. Importance of carbon tax in Thailand Thailand was ranked as the 20th largest emitter of CO2 globally, contributing approximately 327 million metric tons of GHG emissions, or 0.90% of worldwide emissions. Recognizing the urgency of the issue and the oversight of its environmental responsibilities, Thailand has taken proactive steps to address its environmental impact. In 2022, Thailand became the second country after Singapore in Southeast Asia to implement carbon tax regime, adopting the “polluter pays” principle supported by the Organization for Economic Cooperation and Development. Currently, the key regulations governing carbon tax in Thailand includes: Excise Act B.E. 2560 (2017) and its sub-regulations Ministerial Regulation Prescribing the Excise Tax Rate (No.23) B.E. 2565 (2022) – expand carbon tax applications Ministerial Regulation Prescribing the Excise Tariff Rate (No. 37) B.E. 2566 – extended tax reductions for eco-friendly vehicles Carbon tax under the Climate Change Act The Draft Climate Change Act outlines a comprehensive carbon tax framework in Chapter 9 (Sections 99–112). Key provisions include carbon taxes and fees, payments and penalties, deductions and exemptions, refunds, income management and appeals. Therefore, after the Act has come into effect, there will be clear rules, guidelines and requirements regarding carbon tax. No. Carbon emissions from the vehicleTax rate (2026)Tax rate (2030)1>200 grams/kilometer35%38%2151-200 grams/kilometer30%33%3121-150 grams/kilometer25%29%4101-120 grams/kilometer22%26%5<100 grams/kilometer13%15% II. CROSS BORDER ADJUSTMENT MECHANISM (CBAM) The new carbon tax mechanism, expected to be implemented in fiscal year 2025, will align with the Cross-Border Adjustment Mechanism (CBAM) set for 2026. With a proposed central rate of THB 200 per ton of CO₂—lower than the EU’s ETS and Singapore’s carbon tax—the revenue may help offset CBAM fees, preventing double taxation. Payments under this framework can be credited toward CBAM fees starting in 2026. CBAM will be implemented in phases as follows: October 1, 2023: New CBAM regulations cover goods like cement, electricity, steel, fertilizers, aluminum, and hydrogen. Thai businesses must report both direct and indirect emissions. October 1, 2023–December 31, 2025: Transition period for reporting emissions data. December 31, 2024: Thai businesses must register with the CBAM Registry and apply for CBAM Declarant status. January 1, 2026: Full enforcement begins. Importers must purchase CBAM certificates to account for emissions. 2026 Onwards: Thai businesses will submit annual emissions reports verified by EU-accredited bodies. 2034 Onwards: Certification for 100% of embedded emissions will be mandatory. III. IMPACTS ON BUSINESSES AND HOW THEY CAN PREPARE IN ADVANCE Businesses will face increased responsibilities and operational costs. These include adapting production processes to reduce emissions, which may impact efficiency and productivity. Exporters, in particular, will experience a drastic increase in costs due to the CBAM compliance. The investments in emissions-reducing technologies and comprehensive greenhouse gas reporting may act as a strain financially and resource-wise. Additionally, the failure to comply with the requirements set out by the draft Climate Change Act and CBAM entails penalties. For example, failure to adhere to CBAM regulations may subject the business operators to fines ranging from 10 Euros to 50 Euros per ton of carbon. Here are some ways businesses can prepare to accommodate the changes in regulations relating to climate change: Adopting innovative production method – Transitioning to renewable energy and clean-energy machinery Integrate automation technologies – Centralize data collection, production and logistics systems Organizational assessment – Perform self-evaluation on the extent to which its current practices align with GHG reduction goals Being prepared for the GHG reporting obligation – Establish systems to measure and report emissions accurately Compliance with deadlines Staying informed on the latest legal updates IV. CONCLUSION Thailand's draft Climate Change Act marks a significant step toward environmental responsibility, governing carbon emissions through measures like the carbon tax and the Cross-Border Adjustment Mechanism (CBAM). With the carbon tax structure in the draft, business will be required to adapt by adopting greener technologies and improving emissions reporting. The inclusion of a CBAM aligns Thailand with international standards, emphasizing the need for businesses to prepare for compliance, especially the additional reporting and payment obligations. As the Act progresses toward full implementation, it will challenge businesses to reevaluate their operations and embrace sustainability to mitigate operational costs and penalties. However, the ultimate goal is a cleaner and more sustainable future. By laying down clear regulatory frameworks, Thailand not only commits to its environmental obligations but also fosters an environment initiative to green innovation and global cooperation.