3 April, 2019
After numerous draft revisions to the Electronic Transaction Act B.E. 2544 (2001) ("Previous ETA") since it was approved in principle by the Cabinet in 2015, the latest Amendments to Electronic Transaction Act B.E. … ("New ETA") have finally been endorsed by the National Legislative Assembly in two separate sessions: one in January 2019 for the revisions to e-signatures, e-transactions, and e-service businesses, and another in February 2019 for the new concept of digital ID and the digital ID system. Key amendments are summarized below.
1. E-signature: The New ETA revises one of the criteria for e-signature to include "a procedure which can identify a signature owner and show his or her intention in respect of the message in electronic data." This revision supports practical circumstances such as e-signature made by a signatory in a position of "witness" to the execution of contracts (not as a "party" to the contract himself/herself). The Previous ETA prescribed that criteria for e-signature was that the signatory certified the information contained in such data message as being his own, which was not applicable to this witness scenario, as such witnesses did not certify the content of the contract as being his/her own. That is, he/she just electronically signed the contract in the position of "witness" only (not as a "party" to such contract).
2. An invitation to make an offer: The New ETA has added a new concept of "an invitation to make an offer" made electronically (as opposed to a mere electronic "offer" concept as prescribed in the Previous ETA) for (1) an offer made to a non-specific person which is accessible to the public via an electronic communication, and/or (2) an offer that allows automatic responses by an electronic communication. Traditionally, a contract will be concluded instantly upon receiver's response, however, as a result of this amendment, a contract in such a manner will not be concluded upon the receiver's response. Such response by the receiver is considered an "offer" instead. That is, such contract shall be formed once the sender eventually accepts the receiver's response.
3. Automatic electronic data exchange system ("AEDES"): The New ETA introduces the definition of AEDES and recognizes a contract concluded (1) between an AEDES and human, or (2) between AEDESs themselves. This is to facilitate the conducting of automated electronic transactions, without them being denied merely on the basis that there is no natural person involved in the system.
4. Digital ID and Digital ID system: The Digital ID and Digital ID system were earlier introduced in the Proofing and Authentication of Digital Identity Bill (“Digital ID Bill”), which was approved in principle by the Cabinet in September 2018. Please see our previous alert. Later, such concepts were revised and made part of the New ETA instead. That is, the New ETA recognizes proofing and authentication of digital identity made via electronic means. This allows for the electronic verification of identity, without the need to repetitively and physically undertake the traditional KYC. In a case as prescribed in the New ETA (e.g. necessity for financial and commercial security), a Royal Decree can be issued at a later stage to require the Digital ID system service provider to obtain a prior license before operation.
5. E-service businesses: In the July 2018 draft version of the ETA, a person wishing to conduct “service business relating to electronic transactions” pursuant to the Royal Decree, (i) must have a branch office or representative office in Thailand, or (ii) establish a place of business in Thailand, unless exempted by the Prime Minister with advice of the Electronic Transaction Commission. However, these requirements have been removed from the New ETA. In any event, as the New ETA prescribes that a Royal Decree can be issued to regulate certain "service businesses relating to electronic transactions" and require notification, registration or a license before commencing such businesses, in cases of (i) financial and commercial security; (ii) the credibility and recognition of electronic transactions systems; or (iii) the prevention of damage to the public, this "may" open room for any future requirements in the form of Royal Decree to include a business presence requirement as mentioned in the July 2018 draft ETA. Online service providers, including Over-the-Top (OTT) services, should monitor this development.
As the National Legislative Assembly has already approved and endorsed the New ETA, it will be sent to His Majesty the King for final approval and then published in the Government Gazette. The New ETA will become effective a day after publication in the Government Gazette. While the exact date of publication is not yet known (as of the date of this client alert), it is expected to be published soon.
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