THAILAND: iTV braces for court's final ruling
Telecommunications expert predicts iTV Plc will return to being in state control
Wednesday, December 13, 2006
By Nattaya Chetchotiros
A leading telecoms expert yesterday expressed confidence that iTV Plc would "sooner or later" return to being an asset fully owned by the state as the Supreme Administrative Court prepared to give the final verdict on the concession conflict. The Supreme Administrative Court will today decide whether or not to uphold the Central Administrative Court's May 9 verdict which overruled an arbitration panel's 2004 order to lower iTV's concession fee and allow it to boost the proportion of its entertainment content.
Somkiat Tangkitvanich, a research director at the Thailand Development Research Institute (TDRI), said he believed the television station would eventually be taken over by the government no matter what today's verdict is.
Mr Somkiat expected the concession contract between iTV and the Prime Minister's Office to be revamped after today's verdict.
"The best way is for the government to let iTV be an independent television station just as it was originally intended to be. The concession fee must not be that high," he added.
Alternatively, he said, the government could cancel the concession contract and let a new station operator be selected through a bidding process.
The owner and status of the station would be changed, but all station employees would keep their jobs, he said.
"But if the government wants iTV to be a commercial station, it should delist iTV from the stock market and make the TV station a public station owned by the people," he added.
Mr Somkiat envisions iTV as a state-owned, yet independent, TV station offering news and content full of substance.
If the Supreme Administrative Court overrules the arbitration panel's ruling, then iTV will be obliged to pay more than 100 billion baht in fines and interest to the PM's Office, according to the original concession contract terms.
Anxious iTV staff who fear their station would be shut down due to a hefty fine have put up a fight by re-running award-winning programmes to remind the public of its broadcasting achievements.
Ajsha Suwonpakprak, director of the station's news department, said no business could cope with a penalty of more than 100 billion baht.
All iTV employees are very worried about their own and the station's future as top executives have yet to inform them about the company's prospects.
"I believe they [top executives] are waiting for the court verdict as well," said Mr Ajsha.
Mr Ajsha added that iTV does not deserve a daily fine of 100 million baht since the concession fee for a 30-year contract amounts to just 20 billion baht.
Chulayut Hiranyawasit, PM's Office permanent secretary, said if the Supreme Administrative Court overrules the arbitration panel's decision, his office will ask the Office of the Attorney-General to quantify the actual fine iTV is liable for.
A source in the Office of the Attorney-General said the fine estimated by the PM's Office is excessive.
"No one wants to say anything, though, for fear of criticism that they are not protecting the interests of the state," the source said.
The PM's Office on Nov 6 estimated that iTV was liable to pay a daily fine of 100 million baht for the period from April 1, 2004 to May 9 this year. The fine altogether amounted to 94.06 billion baht with 76 billion baht interest.
The concession row between iTV and the PM's Office erupted back in 1999 when the station sought compensation from the PM's Office for allowing a new media outlet to operate commercially in such a way that adversely affected iTV's financial situation.
On Jan 30, 2004, an arbitration panel on the case ruled the PM's Office must pay 20 million baht in compensation to iTV and iTV should pay a much lower concession fee while being allowed to increase the proportion of its entertainment content from 30% to 50%.
The PM's Office then asked the Central Administrative Court to overrule the arbitration panel's order. The court overruled the order, and iTV appealed the case to the Supreme Administrative Court.
Date Posted: 12/12/2006