TOT Doubts Court Case Against AIS

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TOT doubts court case against AIS

By Usanee Mongkolporn

The Nation

TOT executives are doubtful that the state agency can press charges against Advanced Info Service (AIS) regarding controversial amendments to concession deals and telecom excise tax.

Doubt lingers even though TOT has demanded damages from AIS to the tune of more than Bt74 billion.

A TOT executive, who asked not to be named, said the agency had taken the telecom excise claim to an arbitration panel, leading some executives to believe it could not press the same charge in court.

A CAT Telecom executive, also requesting anonymity, said that unlike TOT, CAT had not notified its concession holders that it would bring the telecom excise case to court if they failed to pay the damages. This was because CAT had already brought the claim to the arbitration panel.

By threatening to take AIS to court, TOT is believed to be trying to show it has taken serious action against the company. Otherwise it may be open to a charge of negligence of duty.

The first TOT committee set up to deal with the issue concluded that TOT could not bring the excise case to court and would have to wait for the arbitration panel to complete its work.

However, on January 5, that committee was replaced. The new committee concluded that TOT could take all the cases against AIS to court.

The Information and Communications Technology Ministry ordered TOT to claim damages from AIS on the concession amendments and telecom excise at the Civil Court. TOT is expected to claim that AIS has acquired profits through inappropriate means due to the amendments.

TOT has notified AIS of its claim for damages of about Bt74 billion in connection with the sixth and seventh concession amendments and the telecom excise. The cases were cited in last February's Supreme Court ruling to seize assets of former prime minister Thaksin Shinawatra.

Yesterday AIS reacted to the damage claim in a filing to the Stock Exchange of Thailand. It will also send a letter refusing the claim to TOT.

The Thaksin administration imposed the telecom excise tax in 2003. Under the measure, fixed-line and cellular operators had to pay 2 per cent and 10 per cent of concession fees respectively to the Excise Department and the remaining sum to TOT or CAT. This financially cost both state agencies, which previously received the full concession fee amount.

The Surayud Chulanont government reduced the excise rate to zero in 2007.

The sixth concession amendment, made in 2001, set TOT's prepaid revenue share to a flat 20 per cent to the end of the concession period. Before the change, AIS would have had to pay 25 per cent of prepaid revenue to TOT until 2005, rising to 30 per cent until 2015.

The seventh amendment allowed AIS to deduct the cost of roaming fees from gross revenue before calculating the concession fees to pay to TOT.

AIS claimed the Supreme Court ruling had no binding effect on AIS, since neither TOT nor AIS was a party in the Thaksin case.

It added that the ruling did not revoke the sixth and seven concession amendments, which remain valid. Thus AIS claims it is not obliged to share any additional revenue as demanded by TOT.

AIS added that TOT's claim over the telecom excise was a duplication of a claim pending in the arbitration process.

AIS said it had not been contacted by TOT, the ICT Ministry or any other state authority to negotiate over the concession amendments.

The Cabinet this week approved an ICT Ministry plan to set up a committee to request all concession holders rectify their concession amendments. The committee will report the results to the Cabinet within 15 days.

-- The Nation 2011-02-04