True-CAT 3G Uncertainty Continues

The National Broadcasting and Telecommunications Commission (NBTC) issued an order on 20 June 2012 requiring amendment to CAT’s 3G network contracts with True Corporation on six issues within 30 days to accord with Section 46 of the Frequency Allocation Act of 2010. The 20 June order followed the decision of an NBTC sub-committee on 6 June that the 3G marketing partnership between CAT Telecom and True violates Thailand’s Frequency Allocation Act, as reported here.

The NBTC’s predecessor, the National Telecommunications Commission (NTC), also ordered revision of the CAT-True 3G contracts back on 28 September 2011.


However, to date CAT and True still appear far from reaching agreement over how to amend the 3G contracts to comply with the NBTC order.


CAT's chief executive officer, Kitisak Sriprasert, spoke earlier this month of finalising its plan for "taking care of True customers after the concessions expire (in September 2013) by the end of August 2012, as reported here. Kitisak said that CAT had informed the NBTC that it needs "one more month to wrap up the talks on the matter".


However, CAT has taken the position that the existing 3G network contracts with True should be scrapped "to avoid a possible legal backlash", as reported here, which True's chief executive Suphachai Chearavanont rejected, saying "We're determined to amend the six issues to comply with the order by the NBTC and not scrap the existing contracts and draft new ones to replace them." Mr. Suphachai stressed that the NBTC ordered CAT and True to amend six issues in the contracts, not change them entirely.


Ultimately, if CAT and True are unable to reach agreement over the amendment of the 3G contracts, NBTC could revoke CAT's 3G license, which would have massive implications for True and its customers, as well as CAT itself.