Activists want court to stop True-DTAC merger

Activists want court to stop True-DTAC merger

Consumer group and Move Forward Party say telecom regulator has failed to protect consumers

Consumer advocates picket as they demand the NBTC reject the True-DTAC merger deal at the head office of the telecom regulator on Thursday. (Photo: Apichart Jinakul)
Consumer advocates picket as they demand the NBTC reject the True-DTAC merger deal at the head office of the telecom regulator on Thursday. (Photo: Apichart Jinakul)

Consumer activists and the Move Forward Party will ask the Administrative Court and the National Anti-Corruption Commission (NACC) to object to the planned merger between the telecom operators True Corporation and Total Access Communication (DTAC).

The Thailand Consumers Council (TCC) said on Friday that it was disappointed with the decision by the National Broadcasting and Telecommunications Commission (NBTC) to merely acknowledge the planned merger and not to exercise its power.

The board of the telecom regulator has been divided over whether it has the legal authority to block a merger, or whether it can only set certain conditions, as it has done in the True-DTAC case.

The NBTC failed to protect consumers, said the council, which has warned about the risk of a telecom duopoly in the country.

The council said it would seek an Administrative Court injunction against the merger and ask the court to rule on the issue. It would ask the NACC to investigate whether there was any malfeasance by the NBTC.

Sirikunya Tansakun, deputy leader of the opposition Move Forward Party, said the NBTC had failed to exercise its power to protect consumers and prevent monopoly. The party, she said, would join consumers’ organisations in petitions to the Administrative Court and the NACC.

If the True-DTAC merger goes ahead, it would create the country’s largest mobile operator with a market share of about 56%, versus 44% for the current market leader, Advanced Info Service Plc (AIS).

Reports commissioned by the NBTC that have not been made public, but have been seen by Reuters, recommended that merger be “prohibited” because it was not in the country’s interest.

Findings by the UK-based consultancy SCF Associates say the merger could lead to a decline in GDP growth of 0.6% to 1.5% in five years due to lower investments, a slower rollout of 5G technology and widening the digital divide.

The reports added that findings may change with additional research.

AIS, True and DTAC did not respond to a request for comment.

In a statement earlier this week, DTAC said “the new company will protect customer data, respect privacy, and have the highest priority on cybersecurity”. 

The NBTC has tied the merger to a number of conditions to protect consumer interests and ensure fair competition in the industry. Its board outlined five areas of concern including service rates, market obstruction, quality of service, spectrum holding and shared infrastructure, and the country’s digital divide.

“The next step in the merger is for DTAC and True to discuss these conditions with the NBTC. If the merged entity accepts the conditions, the merger will proceed and the tender offer process can start within a month from today,” said Phatipak Navawatana, an analyst Krungsri Securities. “The merger is expected to be completed by the end of the year.”

The new entity will be listed on the Stock Exchange of Thailand, the companies have said. The Charoen Pokphand Group, the parent of True, would own 29% of the merged entity, DTAC parent Telenor of Norway would hold 27% and China Mobile would have 10.4%, with the rest being held by minority holders. 

True shares closed down 10 satang on Friday on the Stock Exchange of Thailand at 5.00 baht, in trade worth 620 million baht. DTAC shares were unchanged at 46 baht, in turnover worth 540 million baht.

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