TOT may seek Bt60 bn payout from AIS over 'amendments'

[webfact]

TOT may seek Bt60 bn payout from AIS over 'amendments'
USANEE MONGKOLPORN
THE NATION

BANGKOK: -- THE TOT BOARD is expected to consider seeking compensation from Advanced Info Service (AIS) over past amendments to the company's concession agreement, said a source in the state agency.

The compensation is expected to be worth Bt60 billion. The TOT board convened on the case yesterday evening.

The Cabinet on Tuesday gave its approval for the Information |and Communications Technology Ministry to urge TOT to seek the compensation.

AIS said in a filing to the Stock Exchange of Thailand yesterday that it had not received any notification from TOT or any other state agencies that such compensation was being sought.

"AIS has fully complied with the terms of its agreement with TOT. The amendments were in compliance with the law and the practice of other operators' conduct with the state agencies," it said.

AIS's share price yesterday dropped 1.67 per cent to close at Bt236.

The TOT board last month acknowledged the conclusion of the public-private joint-venture panel that the six amendments made to the AIS concession in the past were unlawful and that the state telecom agency should seek compensation.

This public-private joint-venture panel was founded under the Article 43 of the 2013 Public-Private Joint Venture Act.

According to a preliminary estimate, the damages from the second through seventh amendments were Bt59 billion, of which Bt49 billion resulted from the sixth amendment and Bt9.6 billion from the seventh.

TOT granted a 25-year concession to AIS, which will expire on September 30. The state agency amended the concession several times. The highlighted one is the sixth amendment in May 2001 during the Thaksin Shinawatra administration when TOT lowered the concession fee for AIS's prepaid service from 25-35 per cent to a flat 20 per cent until the end of the concession.

Under the seventh amendment in 2002, TOT allowed AIS to deduct the roaming fees paid to its subsidiary Digital Phone Co from the calculation of the AIS concession fee.

These two cases were cited by the Supreme Court in its 2010 ruling finding Thaksin guilty of abuse of power. AIS is the flagship of InTouch Holdings, formerly known as Shin Corp, which was founded by the Shinawatra family. The conclusion of the Article 43 panel is in line with the conclusion of a similar panel founded under Article 22 of a similar, earlier law. The attempt to clear up the AIS concession-amendment problem has dragged on for years. After the court ruling against Thaksin, the Article 22 panel was set up under the Abhisit Vejjajiva administration to rectify the concession amendments and seek compensation from AIS. But still nothing happened until the present ICT Ministry urged TOT to consider the Article 43 panel's conclusion.

Meanwhile, the TOT board has considered AIS's proposal to be TOT's business partner for its mobile-phone service.

AIS reportedly indicated to TOT that the state agency would gain Bt4.5 billion per year from the partnership over a 10-year period.

Source: http://www.nationmultimedia.com/business/TOT-may-seek-Bt60-bn-payout-from-AIS-over-amendmen-30268942.html


-- The Nation 2015-09-17

[Pib]

All I can say is TOT (a semi govt agency) and AIS executives signed previous agreements...so if the current TOT executives don't like the past agreements then they just need to go cry to mommy. But I expect this is just to put more pressure on the Shinawatra family, right or wrong.

[scorecard]

All I can say is TOT (a semi govt agency) and AIS executives signed previous agreements...so if the current TOT executives don't like the past agreements then they just need to go cry to mommy. But I expect this is just to put more pressure on the Shinawatra family, right or wrong.

You make it sound so simple, how convenient.

Perhaps there was a certain period of time when many officials of

many state agencies were very frightened to not sign as instructed.

[DKUNPUTAF713]

I don't think the Shinawatra family has any current connection with AIS!

I could be in error though!.

[Pib]

I don't think the Shinawatra family has any current connection with AIS!

I could be in error though!.

No they don't "now"...but they did in the past as Thaksin Shinawatra basically founded what is the current day AIS. And once he came into power I expect amendments to govt concessions/contracts became much easier.

Note the AIS beginnings in this Wikipedia article: https://en.wikipedia.org/wiki/Thaksin_Shinawatra

Edited September 17, 2015 by Pib

[ezzra]

Seek and you shall find....

[laocowboy2]

All I can say is TOT (a semi govt agency) and AIS executives signed previous agreements...so if the current TOT executives don't like the past agreements then they just need to go cry to mommy. But I expect this is just to put more pressure on the Shinawatra family, right or wrong.

The family doesn't own AIS any more. I believe it is largely government of Singapore. Good one - trying to shake down the Singaporeans for USD2 billion for something that pre-dated their purchase. Good luck with that - and there are Thai assets in Singapore which would be vulnerable to a bit of tit-for-tat.

Edited September 17, 2015 by laocowboy2

[wordchild]

AIS is effectively owned/controlled by Temasek ,the investment arm of the Govt of Singapore, via 1) its majority shareholding in Intouch which owns around 40% of AIS.and in addition to this, 2) Temasek is also the largest shareholder (at around 50%) in Singtel which, in turn, is also a significant direct shareholder of AIS (c 20%) in its own right. it is pretty clear that Singtel,s long term aim is to have complete ownership and/or control of AIS and this will no doubt be gifted to them, by Temasek, at the right price (and time!) ie when the junta allows it.

Edited September 17, 2015 by wordchild

[wordchild]

Sorry I meant Temasek has a major (40% or so) shareholding in Intouch it does not have a majority shareholding.

Edited September 17, 2015 by wordchild