Liquidator seizes Royal Thai Air Force plane in Munich
Share this on

Liquidator seizes Royal Thai Air Force plane in Munich

Brief background from International Institute for Sustainable Development:

An ad hoc tribunal under UNCTIRAL Rules has awarded German investor Walter Bau AG more than 30 million Euros in its claim against Thailand over a tollway concession gone sour.

The tribunal found that the failure of Thai authorities to approve toll hikes as contemplated in the concession contract amounted to a violation of the 2002 Germany-Thailand BIT.

Walter Bau, a German company currently in liquidation, invested in a joint venture to construct and operate a tollway from Bangkok to the Dong Muang airport.  The joint venture was to be operated by Don Muang Tollway Co. Limited (DMT) in which the claimant had a 10% stake.

…In its decision dated July 1, 2009, the tribunal limited its inquiry to whether a breach of the 2002 BIT had occurred after that agreement went into force in October of 2004.  In doing so the tribunal rejected arguments by the claimant that a previous 1961 BIT between Germany and Thailand applied, holding that claims under that prior treaty could only be made by Germany as the prior treaty lacked an investor-state arbitration clause. It also denied attempts by the claimant to apply the 2002 BIT to breaches prior to October 2004.

…In the end the tribunal awarded the claimant 29.2 million Euros for the FET breach and 1.98 million Euros in partial costs, plus interest.

BP: A copy of the award is here. International treaty law, yeah! Read the link above for the summary. So in this case the liquidator must have been thinking, how to get the money? Seizing Thai Embassy assets is not easy. What other assets of the Thai government are there? He must have realized that there is a Thai-government owned plane that flies to Germany regularly and particularly Munich.

Financial Times (German) has the story – go to and scroll down or google the term “Der Insolvenzverwalter des ehemaligen deutschen Baukonzerns Walter Bau streitet sich mit Thailand um Millionen” to find the story. Copy and paste text into Google translate and choose your language if you don’t understand German…. Below is a summary of some of the key points from the article:

The liquidator of the former German construction company Walter Bau is in a multi-million dollar dispute with Thailand. To increase the pressure he seized a plane in spectacular action at Munich airport and a spokesman for the Augsburg auditor Werner Schneider confirmed this to Financial Times Germany.

An international arbitration court in Geneva in mid-2009 confirmed the requirement for Thailand to pay and Thailand still has not paid. Therefore, the seizure of the aircraft is being used as leverage. The liquidator had to be very discreet in action so the pilot of the plane was not warned.

BP: It doesn’t take a genius to work out – as the FT German article makes explicitly clear – whose plane this was given the location of Munich and RTAF plane. Talk about leverage. One can imagine the Thai Ambassador in Germany is coming under pressure to sort this problem out so from that perspective the liquidator’s actions will likely work although one would advise him to rethink the idea of a Thai holiday….