ANTITRUST ACTION

The Trade Competition Board (TCB) will forward its unfair trade charges against AP Honda, the local distributor of Honda motorcycles, to prosecutors before the statute of limitations expires in April.

Santichai Santawanpas, deputy director-general of the Foreign Trade Department, said detailed investigation results about the marathon charge will be put before a TCB meeting chaired by Commerce Minister Boonsong Teriyapirom on Thursday.

The case against AP Honda, based on distributors' complaints, dates back to 2003, when the TCB ruled the company violated Section 29 of the Trade Competition Act by indirectly forcing its agents to distribute only Honda motorcycles. AP Honda, which had a 70% market share, tended to block agents from selling other brands, distributors said. The TCB sent its findings to the court, but prosecutors declined to press the case and asked for more information.

The article prohibits business operators from engaging in unfair practices that destroy, damage, block or limit the operations of rivals or force rivals to give up their businesses. Violations are punishable by jail terms of up to three years and/or fines up to 6 million baht.

The statute of limitations is 10 years, and it will expire for this case in April of this year.

"The prosecutors will be asked to press ahead with lawsuits against the local motorcycle market leader immediately, ahead of the expiry of the statue of limitations," said Mr Santichai. "If the prosecutors do nothing or decline to press ahead with the lawsuits, that will be tantamount to saying the TCB's efforts for 10 years were useless. It would negatively affect confidence in the effectiveness of Thai legislation."

He said the Trade Competition Act may need to be amended to ensure real enforcement, particularly the time frame for investigations and the statute of limitations.

Mr Santichai said the TCB's next meeting will also review the progress in investigating complaints of unfair trade practices against Thai Beverage Plc (ThaiBev), the brewer of Archa beer.

Distributors of Singha beer and its producer, Boon Rawd Brewery, claim wholesalers wanting to buy ThaiBev's liquor products must also buy Archa beer. Boon Rawd also complained that Archa undercut its prices by selling at below cost.

A subcommittee has already been set up to investigate the complaints, which have been ongoing for five or six years, he said.

The Act has been in effect since 1999 without a single case being concluded or any punishment enforced. Critics note problems include unclear definitions of market dominance, business amalgamation, unfair trade practices and uncertain penalties.