Constitutional Court clears 400bn-baht emergency loan decree

Thailand’s Constitutional Court has ruled that the government’s 400-billion-baht emergency loan decree is constitutional, allowing the administration to move ahead with borrowing aimed at cushioning energy-related shocks and supporting the country’s transition towards cleaner energy.

The court delivered its ruling on July 9, 2026, after opposition MPs sought a constitutional review of the decree, arguing that the borrowing plan may have bypassed the normal budget process and may not meet the conditions required for an emergency decree under Section 172 of the Constitution.

The challenge was led by opposition figures including Natthaphong Ruengpanyawut, a party-list MP and leader of the People’s Party, and Korn Chatikavanij, a party-list MP and deputy leader of the Democrat Party. The Seri Ruam Thai Party also joined the petition process through House Speaker Sophon Saram, who forwarded the matter to the Constitutional Court.

Under Section 172, the Cabinet may issue an emergency decree only in urgent and unavoidable circumstances involving national security, public safety, economic security or public disaster.

A total of 133 MPs, not fewer than one-fifth of the existing members of the House of Representatives, signed a submission asking the House speaker to refer the case to the court under Section 173. They argued that the decree authorising the Finance Ministry to borrow to address the impact of the energy crisis and support Thailand’s energy transition did not comply with Section 172.

The decree was drawn up against the backdrop of conflict in the Middle East, which the government says has affected energy security and stability. Thailand relies heavily on imported energy, making the country vulnerable to rising energy costs, higher production expenses and wider pressure on households, farmers and businesses.

The 400-billion-baht borrowing plan is divided into two equal parts.

The first 200 billion baht is intended for immediate relief measures. These include the Thai Chuay Thai Plus 60/40 scheme, additional support for state welfare cardholders by raising monthly assistance from 300 baht to 1,000 baht per person, and measures to help farmers and SMEs reduce production costs and maintain business stability.

The second 200 billion baht is aimed at restructuring Thailand’s energy system for the future. It covers clean-energy projects, support for renewable power generation to reduce dependence on fossil fuels, the electric-vehicle ecosystem, the expansion of EV charging stations nationwide, carbon credit-related income opportunities and green skills development for the workforce.

In its ruling, the Constitutional Court separated the decree into two key parts and considered whether each portion met the constitutional requirements for an emergency decree under Section 172, paragraph one.

The first part concerned the use of loan funds to help people, farmers and business operators affected by the energy crisis. The court ruled unanimously that this section complied with the Constitution. The judges found that the measure fell within the scope of urgent action linked to economic security, as the decree was intended to cushion the impact of volatile energy prices on households, agricultural producers and businesses.

The unanimous ruling covered Section 5, paragraph one of the decree, specifically the provision stating that money borrowed under the decree may be used “to assist people, farmers and business operators affected by the energy crisis”. This portion relates to immediate relief measures, including support for living costs, production costs and short-term economic stability.

The second part concerned the use of loan funds to promote energy efficiency and support Thailand’s transition away from fossil fuels towards renewable and alternative energy technologies. This portion was more contentious, with the court ruling by a 7:2 majority that it also complied with Section 172.

The majority held that the energy-transition section could be treated as part of the country’s response to the energy crisis because it was designed to strengthen long-term energy security and reduce vulnerability to future shocks. The provision covers support for the public sector, private sector, communities and the general public, as well as skills development and innovation related to energy transition.

The seven judges in the majority were Nakharin Mektrairat, Udom Sittiwirattham, Wirun Saengthian, Noppadon Theppitak, Bunjongsak Wongprachaya, Sumet Roykulcharoen and Sarawut Songsivilai.

However, two judges dissented on the energy-transition portion. Jiraniti Havanon and Udom Rathamarit took the view that the second part of the decree did not meet the constitutional test under Section 172.

Their dissent focused on the provision allowing loan funds to be used for energy-efficiency promotion, the shift from fossil fuels to renewable and alternative energy, and related skills and innovation development. They also disagreed with the attached programme plan allocating 200 billion baht to those objectives, viewing that portion as outside the scope of emergency decree conditions.

The court’s decision means the entire decree survives the constitutional challenge. The government can therefore proceed with the 400-billion-baht borrowing plan, including both the 200-billion-baht immediate relief package and the 200-billion-baht energy-transition programme.

The Constitutional Court’s announcement also stated that it considered seven cases at its meeting on July 9. Among the other matters was a petition by Natthakan Sutthiphanwihan asking the court to rule under Section 213 on issues related to the Senate selection process.

That petition challenged the Election Commission’s handling of candidate qualification checks, the certification process for Senate applicants and the rules allowing candidates to select among themselves within groups. The petitioner argued that the process lacked credibility, fairness and transparency and did not reflect the intent of Section 107 of the Constitution.

The court found that the same matter had previously been brought before the Court of Justice and the Administrative Court. Since other courts had already issued final judgments or orders, the case fell within judicial proceedings that had already reached finality.