TOT Plc has been urged to notify its concessionaire Advanced Info Service Plc (AIS) by tomorrow that it will seek compensation of 70 billion baht on the amendments of its mobile prepaid revenue-sharing concession.
The suggestion was made by Information and Communication Technology (ICT) Minister Uttama Savanayana. However, he admitted he still believed the controversial dispute between TOT and AIS would almost certainly end up in court.
After discussions with TOT's executives yesterday, he urged the state telecom to start proceeding with the legal process to settle its prepaid concession with AIS.
TOT last week asked the Office of the Attorney General how to handle the case. Last Tuesday, the cabinet wanted TOT to clarify any damages related to the amendments and determine how much AIS would have to compensate.
Mr Uttama said TOT should send notice to AIS by tomorrow to ensure it started the legal process before its 2G concession expired the same day.
"We [the ICT Ministry and TOT] have no choice but have to comply with the cabinet's command," he said.
TOT, which granted the concession to AIS in 1990, has amended the concession seven times, making changes such as extending the concession period to 25 years from 20 years and reducing the amount of prepaid revenue AIS must share with TOT.
The most significant amendment came in 2001, when TOT changed the revenuesharing payments for prepaid services to a flat rate of 20% a month through the remainder of the concession compared with the original revenue-sharing payments of 15% from 1991-95, 20% from 1996-2000, 25% from 2001-05 and 30% from 2006-15.
In February 2006, the Supreme Court confiscated assets from prime minister Thaksin Shinawatra after finding him guilty of abusing his power to benefit companies he owned. The amendments to the AIS concession were cited.
AIS's prepaid concession amendments came under scrutiny during two different governments, but both governments set up legal panels that concluded there had been no damage from them.
Mr Uttama said to avoid any legal backlash from Section 157 of the Criminal Code for negligence of duty, TOT had no choice but to take legal action against AIS.
"It's too early to say who will win this case in court," he said.
Mr Uttama said he had no idea how his ministry would deal with amendments to other mobile prepaid revenue-sharing concessions between CAT Telecom and its concessionaires Total Access Communication Plc (DTAC) and True Move.
A high-ranking AIS source said if the court ruled the company had to pay compensation to TOT, AIS would appeal to the Central Administrative Court.
"We'll ask the court to consider the concession amendments of DTAC and True Move as well," the source said.
Somprasong Boonyachai, group chairman of InTouch Holdings Plc, AIS's parent company, said AIS's amendments were legal. They were jointly made with TOT and are legitimate.
The amendments enabled AIS to cut its mobile tariff rates greatly, particularly for prepaid users, resulting in a boom in the prepaid market.