Debt recovery in Thailand: a guide for foreign creditors
A foreign supplier or lender owed money by a Thai company usually asks the same questions in the same order: is it too late, what can be claimed, and can we sue from abroad. The answers are in the Civil and Commercial Code, the Civil Procedure Code and the Bankruptcy Act, and several of them are not what people expect.
Published 23 September 2026
Is it too late? Two years, five years or ten
The first thing to establish is the limitation period, because it differs with the kind of debt. A trader's claim for the price of goods delivered or work done has two years under section 193/34(1) of the Civil and Commercial Code, unless the goods or work were for the debtor's own business. Where they were, the two-year period does not apply, and section 193/33(5) gives the claim five years. A foreign supplier selling to a Thai company for its business should therefore not assume that invoices more than two years old are lost. A loan has no special period of its own and falls under section 193/30, which sets ten years. A claim on a dishonoured cheque against the drawer, by contrast, must be brought within one year under section 1002.
What stops the clock
Under section 193/14, limitation is interrupted where the debtor acknowledges the debt in a written acknowledgment, pays part of it, pays interest, gives security, or does anything else that clearly implies acknowledging it; and also where the creditor sues, files a claim in the debtor's bankruptcy, or refers the dispute to arbitration. A part payment made a year ago, or a document in which the debtor accepted the debt, may therefore change the answer to the first question. Those documents are worth finding before anything else is decided.
When the debtor is in default
Section 204 separates two situations. Where the time for payment was fixed by the calendar, such as a stated due date, the debtor is in default as soon as that date passes without payment, and no demand is needed. Where it was not, the debtor is in default once the creditor has demanded payment after the debt fell due. The date of default matters because interest for default runs from it.
What interest can be claimed
On a money debt, section 224 provides for interest during default at the rate in section 7 plus two per cent a year. Section 7 sets three per cent a year, a rate that may be adjusted by royal decree. Where the creditor can claim a higher rate on another lawful ground, such as the contract, that rate continues instead, and interest may not be charged on interest during default. Loans between ordinary persons are also subject to the fifteen per cent ceiling in section 654, and a term fixing more than that is void, as the firm's article on excess interest explains.
Demand letters: one fixes default, two support a bankruptcy petition
Where there is no calendar date, a written demand is what puts the debtor in default. If a bankruptcy petition may follow, the demands are worth planning from the start: section 8(9) of the Bankruptcy Act presumes a debtor insolvent where it has received written demands for payment at least twice, at least thirty days apart, and has not paid. Where the debt is guaranteed, a separate notice is owed to the guarantor in writing within sixty days of the default under section 686 of the Civil and Commercial Code; without it, the guarantor is released from interest, damages and charges arising after that period.
Suing in Thailand from abroad: language and documents
Proceedings in the Thai courts are conducted in Thai under section 46 of the Civil Procedure Code, and where a document filed is in a foreign language, the court orders the party filing it to provide a certified translation of the whole or of its essential parts. A foreign company's contracts, invoices and correspondence therefore need translating when they are filed. Section 47 deals with powers of attorney: where the court has reason to doubt one, or the other side raises a doubt, it may require that a power of attorney made abroad be witnessed by a Thai consul or, where there is no Thai consul, by a notary public or magistrate, together with a certificate from the foreign government that the witness is authorised. Having a power of attorney signed abroad witnessed in one of those ways before it is filed avoids the question arising.
Security for costs
A foreign creditor should expect one application in particular. Under section 253, where the plaintiff has no domicile or place of business in Thailand and no property in Thailand liable to execution, or where there is reason to believe it would avoid paying costs if it lost, the defendant may apply at any time before judgment for an order that the plaintiff deposit money or give security for costs. If the court orders it and the plaintiff does not comply, the case is struck out, unless the defendant asks for it to continue or the order is appealed. Budgeting for that deposit at the outset keeps a claim from stalling part-way.
If the contract has an arbitration clause
Where the contract refers disputes to arbitration and the debtor is sued in court instead, it may apply under section 14 of the Arbitration Act B.E. 2545 (2002), no later than the date of filing its defence, for the case to be struck out so that the dispute goes to arbitration. An award made abroad is enforced in Thailand under section 41 where it falls under a treaty or convention to which Thailand is a party, such as the 1958 New York Convention, and the application must be made within three years of the award becoming enforceable under section 42.
A bankruptcy petition as an alternative
Against a company that cannot pay, a creditor may petition for its bankruptcy instead of suing for judgment. Section 9 of the Bankruptcy Act allows a petition where the debtor is insolvent, where a debtor that is a juristic person owes the petitioning creditor or creditors not less than two million baht, and where the amount of the debt can be determined with certainty, whether it is due now or in the future. Insolvency has to be shown, which is where the presumptions in section 8, including the two demands in section 8(9), come in. Whether a petition serves a creditor better than a claim for judgment depends on the debtor and on the other creditors, and is worth weighing before either is filed.
After judgment
A judgment does not by itself put money in the creditor's hands. Enforcement is a separate stage: the judgment creditor has ten years from the date of the judgment to seek execution under section 274 of the Civil Procedure Code, and once the court has issued a writ of execution, the debtor's assets can be traced, seized and attached. The firm can be instructed for the claim alone, or for enforcement as well, as agreed.
The judgments this rests on
Supreme Court judgment 1772/2542
A foreign arbitral award falling under the 1958 New York Convention, to which Thailand is a party, is recognised and enforced in Thailand; the court may refuse only on the grounds the statute sets.
Questions this raises
Our invoices are more than two years old. Is the claim time-barred?
Not necessarily. The two-year period in section 193/34(1) of the Civil and Commercial Code does not apply where the goods or work were for the debtor's own business; the claim then has five years under section 193/33(5). A part payment or a written acknowledgment of the debt also interrupts limitation under section 193/14.
What interest can we claim on an overdue invoice?
During default, interest at the section 7 rate plus two per cent a year under section 224, or a higher rate where there is another lawful ground for it, such as the contract. Section 7 sets three per cent a year, a rate that may be adjusted by royal decree.
Can a creditor based abroad be ordered to pay money into court?
Yes, where the conditions in section 253 of the Civil Procedure Code are met: no domicile or place of business in Thailand and no property in Thailand liable to execution, or reason to believe costs would not be paid. The court may then order a deposit or security for costs, and the case is struck out if the order is not complied with, unless the defendant asks for it to continue or the order is appealed.
The legislation
- Civil and Commercial Code, sections 193/14, 193/30, 193/33 and 193/34
- Civil and Commercial Code, sections 7, 204 and 224
- Civil and Commercial Code, sections 654, 686 and 1002
- Civil Procedure Code, sections 46, 47, 253 and 274
- Bankruptcy Act B.E. 2483 (1940), sections 8 and 9
- Arbitration Act B.E. 2545 (2002), sections 14, 41 and 42
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