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Threat of TOT, CAT suits alarms mobile firms [Bangkok Post, Thailand]
(Bangkok Post (Thailand) Via Acquire Media NewsEdge) Nov. 20--Mobile phone operators have warned the government of repercussions if state telecom enterprises follow its advice to pursue legal action to recover 138 billion baht in damages suffered from concession amendments with operators over the past several years.
The Finance Ministry proposed that the cabinet recommend legal action to address the heavy damages suffered by TOT Plc and CAT Telecom from nine concession amendments.
True Corp vice-chairman Athueck Asvanont said he did not understand why the government was suddenly seeking to clarify the status of past amendments to the concessions of the three mobile operators.
The Council of State, the government's legal adviser, ruled two years ago that the amendments did not comply with Article 22 of the 1992 Public-Private Joint Venture Law, which covers agreements with a value of more than 1 billion baht.
The private sector alone should not be blamed, as the state telecom enterprises were contracted parties, he said.
The concessions of the three operators were different, he added. The legal interpretation of Article 22 had been sought for amendments to contracts with Advanced Info Service and DTAC, the first- and second-ranked operators.
He said amendments were made on several points, including revenue sharing and extension of concession years.
If the Council of State rules that any amendments violated the law, it would still be up to the cabinet to decide whether to pursue a legal remedy since the council is only an adviser.
In the case of True, he said, if a ruling came out that its concession was flawed from the start, then it would only mean such an agreement had no legal commitment from the beginning.
In this case, the government would be in trouble with the operator, he said.
If it were determined that True Move operated under an invalid concession from the beginning, "then we will recall all our assets transferred to CAT Telecom under the build-transfer-operate concession and recall all our paid revenue shares in the past", said Mr Athueck.
If the government insisted on such a ruling, he warned, the company was ready to cease operations and the government would have to be held responsible for the troubles of True's customers.
"Reviving such matters might be a routine job for the government, but it only creates headaches for the industry at a time when the future of 3G still remains unresolved," he added, referring to uncertainty about licences for new mobile broadband technology.
AIS chief executive Wichian Mektrakarn said that if the cabinet decided the private sector had to repay money for damage caused by lost revenue shares, it would be unacceptable and the company would seek legal channels to defend itself.
The Finance Ministry estimated damages to TOT of 87.39 billion baht resulting from the amendment of the AIS concession.
CAT Telecom is estimated to have suffered 50.64 billion baht in damages through four concessions, including 20.4 billion under its operating agreement with DTAC.
To see more of the Bangkok Post, or to subscribe to the newspaper, go to http://www.bangkokpost.com.
Copyright (c) 2009, Bangkok Post, Thailand
Distributed by McClatchy-Tribune Information Services.
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