The impounded Thai plane is free – but not for free

Originally published at Siam Voices on July 21, 2011

A German court has decided on the fate of a Royal Thai Air Force aircraft, belonging to Crown Prince Maha Vajiralongkorn – or to the Thai government, depending on who you listen to – which was impounded last week by a liquidator for the bankrupt Walter Bau AG construction company. For more background, see Bangkok Pundit‘s posts here and here. From Reuters:

A German court on Wednesday ruled Thailand’s Crown prince would have to pay a 20 million euro deposit ($28.40 million) for the return of his plane, impounded during a long running commercial dispute.

The Landshut court in Bavaria said in a statement on Wednesday the 20 million figure was based on the estimated value of the plane. It said a deposit was necessary as it had not yet decided on the ownership of the plane.

German court wants $28 mln to free Thai prince’s jet“, Reuters, July 20, 2011

AFP further details the verdict:

But a court in nearby Landshut said it had received an assurance under oath from the Thai Department of Civil Aviation’s director that the plane belonged to the prince, not the Thai state, as well as a 2007 registration certificate.

The vice president of the court, Christoph Fellner, said however that since these documents provided only a “presumption of ownership,” 20 million euros ($28.2 million) had to be deposited in the form of a bank guarantee.

“No guarantee means no take-off,” he said. “If everything goes well for the prince and we establish that the aircraft really belongs to him, than he will get his bank guarantee back.”

German court releases Thai prince’s plane“, AFP, July 20, 2011

In a nutshell the court gave the Thai government the benefit of the doubt over the ownership of the plane and if this assurance would be decided as wrong, it will cost the Thais 20 million Euros.

But how do the Thai media outlets report on this, given how gingerly they handled this story in the past week? The Nation goes with the headline “German court releases Thai plane“, Bangkok Post writes “Royal jet released“, which both wrongly imply that the plane can now leave Germany. But the biggest offender is MCOT who went with:

German court rules royal jet doesn’t belong to Thai government: Thai Foreign Ministry (MCOT, July 13, 2011)

But the court said its decision was only preliminary so a bond was requires and 20 million euros (US$28.2 million) must be deposited as a bank guarantee. When the court finally establishes that the aircraft does belong to the Crown Prince, it will return the bond.

A German court on Wednesday ruled that the impounded aircraft used by Thailand’s Crown Prince Maha Vajiralongkorn does not belong to the Thai government and agreed to release it on condition that a 20 million euro (over US$28 million) bank guarantee must be deposited, according to Foreign Ministry’s Information Department deputy director-general Jesda Katavetin. (…)

He said the Thai legal team was working on the details of the ruling and could not reveal the details at the moment, but the ruling could be considered as a successful crucial step for the lawyers. (…)

You couldn’t be further from the truth! That’s what you get when you only speak to government officials: you only get opinion soundbites that aren’t necessarily true – and of course they will try to sell this as a success, which clearly isn’t. This whole piece is only topped by the last paragraph, which basically contradicts the whole article! Even the Thai language media, both press and TV, were more accurate in their reporting.

All in all, this is not to be considered a victory by the Thai side but the final verdict has not been delivered yet – until then, the plane will remain grounded and with it hopefully the rabble rousing by all people involved as well.

[UPDATE] The liquidator Werner Schneider has issued a statement in German through his law firm (PDF here), some excerpts:

“Even though the plane has been released, with the deposit of 20 million Euros we have achieved an important, successful interim result. It will be interesting to see who will pay the security deposit,” says Werner Schneider, liquidator of the WALTER BAU-AG. Eventually, the point of the impoundment was not to turn the Thai plane into account, but to push [the Thais] for the required payments. In the point of view of Schneider, Geiwitz & Partner [the law firm], we have gone one big step ahead. (…)

Schneider sees the responsibility for potential diplomatic disturbances between Thailand and Germany only at the Thai government, because of their refusal to pay. “Thailand violated a bilateral intergovernmental agreement to protect investments for years – without any effective reactions from the [German] Federal Government,” continues Schneider.

From: “Pressemitteilung: Insolvenzverwalter Schneider: Pfändungsaktion war ein Erfolg” (PDF), Kanzlei Schneider, Geiwitz & Partner, July 20, 2011 – translation by me

I think Schneider can now really forget about a holiday to Thailand anytime soon…!

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