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NEWS UPDATES Asean Affairs        3  February 2011

Compromise key to untangle Thai telecom dispute

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The government committee tasked with resolving telecommunications contract amendment disputes may be preparing to compromise with private operators rather than seek the full amount of compensation demanded.

Mobile operators have also expressed confidence the state agencies that allowed the concession amendments will take responsibility as well.

Jirawan Boonperm, the permanent secretary for the Information and Communications Technology ministry and chairwoman of the four-member committee, said negotiations could end with operators not having to pay TOT full compensation.

"If they [private mobile operators] come up with a solution acceptable to all parties, a settlement can be made," she said.

The committee, which was decreed by the cabinet on Tuesday, will hold talks with executives of Advanced Info Service, Total Access Communication and True Corporation about solving the problems stemming from past amendments to their contracts.

However, a source at one mobile company said arbitration would likely be required to help settle the dispute unless the government has the authority unilaterally to rule the amendments void. A final decision on the negotiations will be made by the cabinet.

One executive said that even if the committee could scrutinise all of the details in the amended contracts within the 15-day limit set by cabinet, whether the dispute can be settled by that deadline is uncertain.

Also, government demands that concession holders return to the original terms will only lead to other problems, as the current terms have been used for years and already affected the companies' business, policy and investment plans.

"The private companies' stance is the contract amendments were not done by them, but rather state agencies. So if the government wants someone to take responsibility for this, it should be whoever allowed the amendments to be made in the first place," said the executive.

Suphachai Chearavanont, the chief executive of True Corporation, expressed concern about TOT's request for a telecom excise tax payment of 1.4 billion baht from his company for fixed-line business. Under the amendments, operators' revenue sharing with the state could be considered excise tax.

The other issue is TOT's request for 35 billion baht in compensation for access charge fees from True Move. Its concession is owned by CAT Telecom, who failed to pay access charge to TOT.

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