OMG! OAG wants 411 on CAT, TOT 3G deals, PDQ

23 Feb 2011

Thailand’s Office of the Auditor-General (OAG) has requested clarification from state-owned telcos CAT Telecom and TOT on recent 3G expansion deals to address concerns that they could violate the Trade Competition Act of 1999, the Bangkok Post reports. Pisit Leelavachiropas, the OAG’s acting governor, said the contract signed by True Move – the new operator of the Hutch network – with CAT allowing it to roll out and operate 3G HSPA services may fall foul of the Act if the lease is aimed at only one company while shutting out all others. The OAG earlier sent a letter to the CAT board and ICT Minister Juti Krairiksh asking 14 key questions including why the state telecom enterprise ‘hastily’ signed the contract with True without determining a frequency price or laying out clear details. As no response has been received so far, another letter will be sent, Mr Pisit told a seminar on Monday at the offices of the National Broadcasting and Telecommunications Commission. Mr Pisit said the 14-year retail and wholesale contracts of True subsidiaries Real Move and Real Future fall under the category of concession contracts and therefore may also violate the 1992 Public-Private Joint Venture Act and frequency allocation regulations. ‘The deal highlights the ineffectiveness of the Public-Private Joint Venture Act and violates the law,’ he said. Under the main contract, CAT has not calculated the value of frequencies on top of the takeover price for Hutch – previously a CDMA-based joint venture between Hong Kong’s Hutchison Telecommunications International and CAT. Mr Pisit said the OAG will this week call for clarification from TOT and the ICT minister as to why the state enterprise’s specifications seem to have been designed for only a certain bidder.

Meanwhile, the Post writes that the investigation into TOT’s recent dealings comes amid complaints that the preliminary screening process for last month’s auction of a nationwide 3G network expansion contract lacked transparency. Ericsson of Sweden and ZTE of China were unhappy to be prohibited from entering the final stage of the auction, which was won by a consortium of Samart, fellow Thai group Loxley, Finland-based Nokia Siemens Networks and China’s Huawei Technologies. Mr Pisit said the OAG will consider whether the process violated the Trade Competition Act. ‘If we find any irregularities in the True-Hutch deal or the TOT 3G projects that damage the government, we’ll forward the case to the National Anti-Corruption Commission for further scrutiny,’ he declared.

Thailand, CAT Telecom, Hutch (Thailand), TOT, True Move