The ICAO, a United Nations agency, issued Thailand a warning in March after an audit raised questions about its ability to oversee airlines under its jurisdiction, giving the country 90 days to address its concerns.
On Thursday it amended its online Safety Audit Information
, issuing Thailand a red flag for failing to adequately deal with the situation within that time frame.
In addition to Thailand, only 12 other nations are red flagged by the ICAO --- Angola, Botswana, Djibouti, Eritrea, Georgia, Haiti, Kazakhstan, Lebanon, Malawi, Nepal, Sierra Leone and Uruguay.
In response to the red flag, flag carrier Thai Airways issued a statement saying that it operates with the highest safety standards.
"A significant safety concern does not necessarily indicate a particular safety deficiency in the air navigation service providers, airlines (air operators), aircraft or aerodrome; but, rather, indicates that the State is not providing sufficient safety oversight to ensure the effective implementation of applicable ICAO Standards," said Charamporn Jotikasthira, president of the airline.
The Thailand Transport Ministry did not immediately respond to a CNN request for comment.
Alan Polivnick, a partner at global law firm Watson Farley & Williams, which specializes in aviation matters, says the biggest issue is how other countries will respond to the red flag.
"If you look at all the other countries that have red flags, Thailand is the only one other than Nepal in this region, and there will be concerns raised about this," he says.
Staff shortages raise alarm
In March, the ICAO's warning led several countries in the region to issue a ban on new flights from Thailand and increase scrutiny of its planes.
"We've already had Korea, China and Japan place restrictions on new Thai flights
. Singapore, Australia and the EU ordered enhanced inspections," says Polivnick.
"Whether this will prompt them to call for further inspections or create further restrictions on Thai airlines remains to be seen, but there's nothing to stop them from doing that. It's within each country's power to do that."
Polivnick says it's the regulator -- not individual airlines -- that the ICAO is looking at.
During its audit earlier this year, the ICAO raised issues relating to the Department of Civil Aviation's (DCA) ability to supervise airline operators and operations due to a shortage of staff.
"If you look at the growth in airlines and airline operators in Thailand over the last 10-15 years, the number of people in the DCA supervising and dealing with applications hasn't changed much," says Polivnick.
ICAO spokesman Philbin Anthony told CNN that Thailand appeared to be taking the issue seriously.
He said the country's deputy prime minister, Prawit Wongsuwan, had traveled to the Montreal-headquartered ICAO to "stress his country's commitment at the highest level, to continue to address this matter."
He added: "We continue to work collaboratively with Thailand to help it achieve that goal."