Doing business in some countries can involve payment of unofficial “fees” to government officials in order to obtain requisite permissions, licenses, etc. Aside from the unexpected cost these “fees” add to the expense of doing business, payment of such “fees” often violates corporate policies or other nations’ business laws, creating corporate compliance risk.
In Thailand, these “fees” are known as “tea money”. Effective this month, Thailand’s new Licensing Facilitation Act (2015) mandates written procedures and oversight by an enforcement committee intended to preclude payment of “tea money” and other potentially unfair discretionary acts by government officials in transactions with corporations doing business or seeking to do business in Thailand. Actual implementation and enforcement of the Act will be observed by interested parties over the coming months.
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By Duensing Kippen.