Telecoms body cuts type-3 licence fee

The Nation (23 November 2007)

The national telecom regulator yesterday approved lowering the type-3 licence fee to 2.5 per cent from the present 3 per cent of the licensee's revenue, due to the expected negative economic outlook next year.

However, a telecom analyst at one foreign brokerage house said he was disappointed with only a slight reduction, saying the National Telecommunica-tions Commission (NTC) should cut the fee to 1 per cent to reduce the licensees' burden.

NTC secretary-general Suranan Wongvithayakamjorn said the fee reduction would take effect early next year.

The type-3 licence is for applicants with their own large networks whose competition widely impacts mass consumers.

Suranan added that the fee reduction would not affect the NTC's financial status. The licensing body expects total regulatory fees - licence and phone-number fees - of around Bt2.8 billion this year, he said.

He said the NTC has yet to set a plan to cut the other regulatory fee.

The foreign brokerage-house analyst said the NTC should bring down the overall regulatory fee to the lowest level to enable telecom firms to pass on the benefits to consumers in the form of service-fee discounts.

"Don't forget that the NTC's purpose in collecting fees is to run its operation, not to generate revenue for the government. Therefore, it has no need to seek a huge regulatory fee," he said.
Suranan said the NTC will consider further cuts every year.

Wichian Mektrakarn,president of Advanced Info Service (AIS), said it is good thing that the NTC has cut the fee.

TOT and CAT Telecom are among the holders of type-3-licences.

Meanwhile, the licensing body's board has permitted True International Communications and Jastel Network to operate international data communications on a trial basis for another three months.

It also granted a licence to Jasmine Telecom System to operate 10,000 public telephones nationwide. The company will spend Bt165 million on developing the service over the next three years.

Shin unloads all shares in Capital OK

The Nation (22 November 2007)

Shin Corp on Tuesday signed a share-purchase agreement with Acap Advisory and Orix to sell all shares in its personal-loan provider, Capital OK, to the two companies.

In a filing with the Stock Exchange of Thailand yesterday, Shin said 74,999,994 shares were sold, representing 99.99 per cent of Capital OK's registered and paid-up capital.

The transaction is worth Bt290 million for the shares alone or Bt990 million if the value of a Bt700-million loan granted to Capital OK by Shin is included.

After the transaction, Acap will own 50.99 per cent of Capital OK, and ORIX will own the rest. Shin expects to receive Bt990 million in cash from the deal no later than December 14.

Orix is an integrated financial-services group based in Japan with assets of US$70 billion (Bt2.37 trillion).

The two purchasers are responsible for securing sources of funding to repay the loan to Shin. If they are unable to find funding in time, the transaction will be cancelled.

Acap and Orix announced last month that they would take over the entire stake of debts in Capital OK from Shin for Bt990 million.

The divestment of Capital OK is in line with the plan of Temasek Holdings- controlled Shin to focus solely on the telecom business, Advanced Info Service.

OAG to probe NTC's spending abroad

The Nation (22 November 2007)

The Office of the Auditor-General (OAG) is reinvestigating expenditures on foreign study tours by the National Telecommunications Commission (NTC) in its 2006 budget following complaints about the high amount, a source at the national telecom regulator said.

The source said the OAG renewed its investigation recently after having already completed its routine scrutiny of the NTC's 2006 budget. "The OAG has asked for more information on the overseas study tour expenses of the commissioners and their staff," the source said.

Asked about the matter, NTC secretary-general Suranan Wongvithayakamjorn said the OAG's examination of the NTC's expenditure was nothing unusual. The telecom licensing body set aside a budget for overseas study tours and training of Bt70 million each for last year and this year.

Meanwhile, chairman Choochart Phromprasid said the NTC had earlier expected to receive total regulatory revenue of Bt3 billion this year, but its two major licensees - TOT and CAT Telecom - have yet to pay overdue fees of around Bt1 billion.

Excluding this amount, the telecom regulator expects to have Bt800 million of unspent revenue this year.

Choochart said part of this amount would be put into regulatory funds and part of it to finance the administration of its key institutions, including the Telecommunications Research and Industrial Institute and the Telecom Consumer Protection Institute (TCPI).

The TCPI yesterday appointed Prawit Leesataponwongsa as its first chairman. Prawit was on the social committee of the National Economic and Social Advisory Council.

Don't take candy from candidates

The Nation (22 November 2007)

The ICT Expo 2007 successfully wrapped up on Tuesday, with students and parents and kids filling up the exhibition hall during the four-day event.

It must have been a good day for Choochart Phromprasid, chairman of the National Telecommunications Commission (NTC), for it's known that the old man has a soft spot for kids.
At the NTC booth on Tuesday, Choochart took photos with guests. But when he saw some kids, he wanted a photograph with them. He turned his back to the NTC booth so that the passers-by could join the photo session. But that meant he was being photographed in front of CAT Telecom's booth.

An idea popped up: he asked the group to stand in front of the NTC booth and take more photos. Posing beside him was a little girl who came with her mother. Choochart was delighted and chit-chatted with the girl in a friendly way that only made other telecom operators jealous. At the end, he said: "Here, Uncle will give you some money."

The girl's mother was surprised, asking people who was this old man. She had a reason to do so. As the election is approaching, people giving out money can easily be deemed as MP candidates. Who else would give Bt1,000 to a girl he had just met? Nimit goes all coy on media

"It's not easy to run a PR company" is probably the ultimate answer that Nimit … , 124 Communications, would have liked to give at yesterday's press conference.

Yesterday, his company assisted … in publicising his plan to develop a theme park and a residential development project.

But the developer did not want to divulge many details. The press release contained only brief information on the new projects. The executive, …, was also rather reserved.

Nimit must have thought that reporters would not be satisfied with the answers. Standing next to …, he helped answer nearly every question. One was the exact value of the development projects and when the residential project is expected to be sold out. While … did not give a round figure on the value, Nimit said it's beyond Bt10 billion. Of the sales period, he said within a month while … was reluctant to be specific.

Nimit turned off his microphone only when reporters asked if they could quote him or … in their articles.

He was a figure of sympathy, standing in the middle of his clients and reporters and trying to impress both sides.

Companies set to meet tougher tax collector

Bangkok Post (21 November 2007)

Stricter audits and enforcement next yearPrivate companies should prepare for tougher tax collection by the Revenue Department, say tax experts. Thavorn Rujivanarom, lead partner of PricewaterhouseCoopers Legal & Tax Consultants, said the Revenue Department would press on to collect taxes from private companies this year after tax receipts last year were below officials' projections.

This year, the department hopes to collect 1.208 trillion baht in taxes from all sources. Last year, the total tax collected was 1.119 trillion baht, below its target of 1.14 trillion.

''The Revenue Department has been imposing a tougher tax collection policy, especially on companies. ... Tax officers will use every means they have, from an operation visit to auditing and a change of tax law to favour the state,'' he said.

Tax audits would be more aggressive and companies would have to appeal cases related to tax payments.

In cases requiring interpretation of the tax law, Somboon Weerawutiwong, a PWC partner, said the rulings would favour the government rather than private companies.

''Tax officers are very careful and strict. They were accused of favouring big companies and costing the state a lot of money in the past, especially in the controversial case of share sales by Shin Corp to Temasek and the Ample Rich share transfer case,'' he said.

Both legal experts suggested that companies prepare sufficient documents for tax officers when they conduct an audit.

Mr Thavorn noted that the Revenue Department has changed its policy related to tax collection on projects that have been awarded tax privileges by the Board of Investment.

In the past, each company was able to report losses on a project-by-project basis and carry accumulated losses as a tax shield for five years.

But the new policy states that if a company has many BoI-approved projects, it must offset profits and losses among all projects first before reporting total profits.

The new ruling has increased the tax bill for many companies and some who disagreed with this method have appealed to the Finance Ministry's special committee related to laws and legislation, he said.

Mr Thavorn said the Revenue Department was closely monitoring the automobile, banking and finance industries. It is trying to link its information database with the other agencies such as the Port Authority of Thailand and the Commerce Ministry to cross check whether companies pay taxes.

''Some rulings and law interpretations in the past can be changed now. This has caused many companies a lot of confusion,'' he said.

Mr Thavorn said the Revenue Department should change its mindset, and help companies expand, which in turn would help boost tax revenues.

Work practices and legal interpretations used by different tax officers and offices throughout the country should also be made uniform, he added.

Mr Thavorn said Thailand should have a clear tax policy to attract foreign investors. This would also help increase competitiveness of companies.

Thailand's 30% corporate income tax is higher than other countries in Asia. Vietnam charges 28%, Malaysia 27%, Singapore 20% and Hong Kong 17.5%.

''I think foreign investors can stay with tougher laws and regulations but the rules must be clear so that they will can forecast risk and return,'' Mr Thavorn said.

''Enforcement must be consistent as well as foreign investors don't want to deal with uncertainty.''

Salary increases projected at 7%

Bangkok Post (21 November 2007)

Local employees are likely to see an average salary increase of 7% this year, up slightly from 6.9% last year.

According to a survey by The Hay Group, the stronger baht has negatively affected manufacturing but has been positive for the oil and gas sector. Manufacturing workers can hope for an average raise of 5.6% while those in the energy sector can look forward to 8.5%.

Hay surveyed 117 companies responsible for almost 100,000 jobs across Thailand. It covered nine industries including energy, chemicals, retail, finance and banking, fast-moving consumer goods, professional services and more.

Boonlerd Viboonkiat, Hay's country manager, said nearly 70% of the respondents were foreign-owned companies while the remaining 30% were local ones.

The survey revealed that blue-collar workers can expect to see their salaries rise by 6.7% and middle and senior management by 7%. Employees in consumer products can hope for 7.4%, retail business 6.4% and chemicals 6%.

Overall, employees are likely to receive a bonus of 2.6 months' salary, which is lower than last year's 2.8 months and 3.3 months in 2005.

Employee turnover has also climbed this year to 9.3%, compared to 7.9% in 2006. The retail sector holds the highest employee turnover rate of 16.6%.

The average starting salary of new graduates ranges from 14,268 baht in banking to 19,173 baht in engineering.

TOT requests collaboration

The Nation (21 November 2007)

In a U-turn, TOT has asked to collaborate with private telecom operators, to solve the conflicts they have had with the state agency and become its partners in a plan to become a "national network provider".

The state agency yesterday called an urgent meeting with four major telecom operators - Advanced Info Service (AIS), Total Access Communication (DTAC), True, and TT&T - to inform them what is on its mind.

TOT has had disputes with True due to their competition in the same field, as well as with DTAC and True Move over access charges. Last week, it filed civil suits against DTAC and True Move, demanding a combined Bt14 billion in overdue access charges.

TOT chairman Saprang Kalayanamitr said all parties should join in a bid to solve the conflicts with the state agency.

"Whatever problems we can clear up among us, we should do so right now," he said.

But he denied TOT had considered withdrawing the civil suit against DTAC and True Move.

TOT also asked the four telecom operators to be partners in its plan to become a national network provider. It has set up a committee chaired by board director ML Anuporn Kashemsant to work out further details and the business model of the project with the telecom operators.

Their first meeting on the matter is scheduled for November 29. The committee will also ask CAT Telecom to join the project. TOT also plans to ask the four telecom operators to sign a project partnership deal with TOT in the future.

True CEO Supachai Chearavanont said his company was willing to support the project, which would benefit the country, but that more details of the project needed to be worked out.