[the nation] This week's moves in the matter of illegal amendments to telecom concessions and the huge sums in compensation said to be due to state agencies have thrown an already complex situation into even deeper confusion.
TOT's board decided on Monday not to claim damages from amendments to the concession of Advanced Info Service (AIS), said to total Bt74 billion.
However, the government may not be able to let the case go easily. Ultimately, it may seek channels through which to claim damages. Otherwise, it may risk facing charges of dereliction of duty.
The TOT board's decision followed many years of examining amendments to its concessions and charges from various state agencies over the allegedly illegal nature of amendments in the case of AIS's concession.
The agency's board reasoned that the issue would end up in the hands of an ICT Ministry panel founded to negotiate with all concession holders over compensation for losses suffered by state agencies because of allegedly illegal amendments to their concessions.
ICT Minister Chuti Krairiksh said yesterday he would not intervene in the board's decision. However, his ministry knew how it would proceed in the case.
A source said the ministry was waiting for its committee founded to negotiate compensation claims with concession holders to wrap up the talks. Then the committee will submit the results to the Cabinet for consideration.
If the concession holders decline to pay compensation, the Cabinet could order TOT and CAT to cancel the concession amendments and claim damages in the Civil and Criminal Courts.
A TOT source said that after an examination of the case and consultation with legal experts, TOT decided it had only a slim chance of winning a damages claim against AIS. It would be hard to find clear-cut evidence that AIS had colluded with former prime minister Thaksin Shinawatra to reap benefits from his policies.
Therefore, the source said, it was judged better to let the ICT Ministry panel proceed with talks with all concession holders and submit the result to the Cabinet.
AIS recently denied the damages claims in a statement to the Stock Exchange of Thailand. It said it had done everything in compliance with the law, regulations and its concession.
Chuti said yesterday he did not understand why the TOT board felt afraid of losing the case to AIS. He said he would continue to protect the state's interests or he would risk facing charges of negligence of duty under Article 157 of criminal law.
Chuti denied that the claims of damages against the concession holders were aimed at pressuring them to pay kickbacks to the Democrat Party. While the concession holders want to see the damages claims settled by arbitration panels, Chuti said he wanted the cases to go straight to court.
Last week, TOT also asked the Finance Ministry to consider paying damages for TOT's losses of telecom excise. CAT Telecom did the same by filing a damages claim at the Central Administrative Court.
A Finance Ministry source said that if the ministry agreed that changes to the telecom excise had cost the state agencies, then it would bring a charge against the Thaksin cabinet on its own.
The Thaksin cabinet imposed the telecom excise in 2003 to allow fixed-line and cellular-concession holders to subtract 2 per cent and 10 per cent respectively from their concession fees and pay it to the Excise Department. The balance of the fees then went to TOT or CAT. Both state agencies claim this arrangement hurt them financially. The Surayud government abolished the telecom excise in 2007.
Chronology: The concession problem saga
May 2007 - The Council of State rules that some telecom concession amendments did not comply with the 1992 Public-Private Joint Venture Act. This leads to the appointment of state-private committees under the 1992 law to probe the amendments.
2008 - TOT and CAT Telecom approaches arbitration panels to claim damages from the concession holders in connection with the Thaksin Shinawatra government's move in 2003 to let concession holders deduct telecom excise from their concession fee.
November 2009: The Finance Ministry's State Enterprise Policy Office (Sepo) discloses that the allegedly unlawful concession amendments cost TOT a cumulative Bt87 billion and CAT more than Bt50 billion.
December 2009: The committees of TOT and CAT during the tenure of ICT Minister Ranongrak Suwanchawee conclude that none of the concession amendments financially damaged state coffers, and on the contrary boosted state revenue and assets to the tune of at least Bt100 billion.
February 26, 2010: The Supreme Court rules in the assets-seizure case against Thaksin.
November 19, 2010: ICT Minister Chuti Krairiksh sends letters to TOT and CAT to take steps to protect their interests in connection with the Supreme Court's ruling on the Thaksin case.
January 31, 2011: TOT notifies all telecom operators to compensate for damages caused by the concession amendments, telecom excise, and access charge to the tune of more than Bt214 billion.
February 1, 2011: Singapore Telecom senior executives hold discussions with Prime Minister Abhisit Vejjajiva on the telecom policy ahead of the Cabinet meeting on the same day. The cabinet approves the ICT Ministry's proposal to set up a panel to seek proposals from the concession holders on how to pay the compensation.
February 4, 2011 - AIS sends a letter to the homes of all 12 TOT board directors and the acting president, urging TOT to withdraw by February 9 its notification of the damage claim. If not, AIS might consider bringing civil and criminal charges against TOT and each individual responsible for the notification to protect its interests.
February 11, 2011: AIS takes its dispute with TOT to the arbitration panel after TOT declines to withdraw the notification claiming damages.
February 22, 2011: Three of the 12 TOT board directors resign from their posts.
February 23, 2011: ICT Minister Chuti sends a letter to TOT and CAT, urging them to protect their interest in connection with the Thaksin case. Two more TOT directors resign from their posts.
February 25, 2011: TOT and CAT claim damages from the Finance Ministry over losses caused by their concession holders deducting telecom excise from the concession fees.
February 28, 2011: TOT's board decides not to claim damages from AIS over the concession amendments, letting the ICT Ministry panel decide the issue.
Stand-off forces govt to consider options