Pursuant to our client alert on Dual-Use Items last year, the Ministry of Commerce (“MOC“) has shifted its focus from revising and updating the Notification Regulating the Dual-Use Items, dated 16 October 2015, previously issued under the existing Export and Import of Goods, Act B.E. 2522 (1979) to the enactment of the new Trade Control on Weapons of Mass Destruction Related Items Act (“WMD Act“). On 30 April 2019, the WMD Act was enacted and announced in the Royal Gazette, and its main provisions will become effective on 1 January 2020.
The WMD Act regulates all items that are related to the spread of weapons of mass destruction (“WMDs”). The regulated items include, WMDs themselves, armaments and dual-use items (“DUI”) as well as tangible and intangible items that could have commercial interest, technology or even software. Controlled activities under the WMD Act not only include export, but also re-export, transshipment, transit, being a brokerage and other actions with the purpose of spreading WMDs.
The MOC is the responsible authority under the WMD Act and has the power to issue subsequent rules and regulations under the WMD Act, including a list of specific items that will be regulated under the WMD Act, controlled activities of each items, and requirements in order to engage in the controlled activities.
It is expected the MOC will subsequently issue a list of goods that are considered DUI, which will be based on the latest EU Dual-Use Item List of 2018. Any person who wishes to engage in the controlled activities for the goods falling under this list will require a license from the MOC (e.g. an export license for export of DUI). In addition, the MOC will issue a second list of goods that require certifications that they are not related in any way to the spread of WMDs, which is based on the latest Harmonized System Codes (“HS Codes“). In the case that the goods fall under this second list, no license (e.g. export license) is required. However, a person will have to make a self-certification to the MOC that their goods under the said HS Code are not DUI – before they can engage in the restricted activities (e.g. export them out of Thailand).
Failure to obtain relevant licenses to engage in the controlled activities may subject the offender to a maximum imprisonment of two years and/or a fine of up to THB 200,000. Additionally, if such offense is committed for the purpose of utilizing items related to the spread of WMDs to cause harm to others or to design, develop, manufacture, use, modify, store, transport WMDs, or utilize such items in any way for the purpose of obtaining WMDs, the maximum imprisonment shall be increased to ten years and a fine of up to THB 1 million. All items relating to such offense will also be confiscated.
Relevant regulations and notifications under the WMD Act are also currently being drafted to ensure that the most important regulations and notifications, especially the rules and regulations regarding steps, procedures and requirements for licenses and self-certification (including an Internal Compliance Program conditions and requirements and their relevant benefits), are issued before its effective date of 1 January 2020.
It is also expected that the MOC will subsequently cancel the Notification Regulating the Dual-Use Items, issued on 16 October 2015 under the existing Export and Import of Goods Act, B.E. 2522 (1979).
We will keep you updated of any significant developments.