Thailand's NACC Seeks New Rules On Contracts To Hold Ministers, Officials Responsible

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NACC seeks new rules on contracts to hold ministers, officials responsible

By Piyanart Srivalo

The Nation

The National Anti-Corruption Commission (NACC) is urging for a set of new rules which will hold ministers, officials and officers of all levels at all government units and state enterprises involved in the drafting, revision or interpretation of any state contracts which result in damage to the Kingdom.

A 6-page recommendation is expected to land at the Cabinet's meeting this Tuesday, as the NACC exercises its power under the National Anti-Corruption Act's Article 19 (8) to come up with a suggestion to prevent and suppress corruption.

In the report signed by president Panthep Klanarongran and obtained by The Nation, Prime Minister Abhisit Vejjajiva on January 20 put a note at the end, saying "Submit this report for the Cabinet's consideration and keep ... informed on the progress."

In the document, NACC noted that the Cabinet should review the process of state contract drafting, revision and interpretation, as many cases result in "direct and indirect repurcussions to the public and affect foreign investment, but none of involved officials were held responsible for the damage. This would plug the corruption opportunities.'

It said all state contracts worth Bt500 million or more should fall into the new set of rules. "In all damage cases, there must be someone held reponsible...to prevent damage to the government units and state enterprises."

It said there must be an investigation into all contracts not signed accordingly to the formal rules or the formats approved by the Attorney General's Office and cause serious damage. Then, disciplinary, criminal and civil actions must be launched to all involved, from ministers, agency chiefs, and officers in the lower levels. It also urged all contract revisions be approved by the Attorney General's Office.

Culprits must also be searched for in the case of contract revision without the office's approval or the units' ignorance to fight for the national interests, or the attempt to interpret the contracts for the benefits of private companies.

For a transparency purpose, NACC suggested all meetings concerning contract drafting or revision be recorded in full and stored as evidence. All draft contracts and annexes must be made public on the Internet. Whenever any potential damage should occur, the particular units must report to the Finance Ministry and the Auditor General's Office. Then, the Finance Ministry must ask for the Cabinet's approval for an investigation and actions against all involved.

The suggestion does not concern state-owned financial institutions.

It is raised at the time when several state enterprises are striking contracts which may violate the laws and cause damage. CAT Telecom recently signed deals with True Corp, despite the absence of some details. TOT auctioned 3G projects despite lingering legal cases by some telecom companies.

Both were also at the centre of the authorities' pressure for damage worth over Bt200 billion from private telecom companies, following the amendments to concessions.

Advanced Info Service is now rejecting the payment claim of over Bt73 billion, saying that such amendments were approved by TOT.

So far, none of the agencies' directors, officials or officers have been implicated in involving with the concession amendments.

The NACC report highlighted six cases which have caused Thailand a fortune.

Two involved TOT, two involved the Expressway Authority of Thailand, and one each concerned the Marine Department and the Government Lottery Office.

In the fibre-optic contract between TOT and Com-Link in 1990s, both agreed to revise the contract in 1990s concerning the scale of completed tasks but none of the agreement was officially inserted into the original contract.

When a dispute flared up in 1994 over revenue-sharing, TOT had to share the revenue based on the entire service spots cited in the original contract. TOT eventually had to pay Bt4 billion to Com-Link. To NACC, this contract was struck to let TOT taken advantage of by the concessionaire.

Concerning TOT's contract with Jasmine Submarine Telecommunications on the submarine cable project, when it came to revenue sharing the agency also based the calculation on the entire number of completed circuits which resulted in higher-than-actual revenue for Jasmine.

Concerning Marine Department's US$49.4 million ship building contract to US manufacturer Ellicott Machine Corp, the department paid upfront fee and payment for parts without any clause in the contract to guarantee product delivery. At a point, the department took delivery of power generating machine but book them as main ship machine which was of greater value. Then, the deparment endorsed the payments before the actual delivery of ships.

NACC's case highlights also involved the contracts between the Government Lottery Office and Jaco and Expressway Authority of Thailand's contracts with BBCD Joint Venture and Bangkok Expressway. It also mentioned the State Railway of Thailand's land leases as well as the Public Relations Department's radio station concessions.

-- The Nation 2011-02-07

[Spee]

"TOT auctioned 3G projects despite lingering legal cases by some telecom companies."

Speaking of 3G, looks like more extended delay due to bureacracy and related factors:

http://www.telecomasia.net/node/20393?section=THAILAND+FOCUS&utm_source=lyris&utm_medium=newsletter&utm_campaign=top10AN