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Chinese fruit dealers squeeze Thai traders out of market

Durian is a favourite in China, making up 41% of Thai fruit exports to the country in 2014. Pawat Laopaisarntaksin

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Govt takes action after Chinese traders squeeze out Thai fruit firms. Foreign business act changes to be made in some sectors.

FOREIGN BUSINESS ACT & AGRICULTURE

Chinese fruit dealers squeeze Thai traders out of Thai fruit market

3/03/2016
Phusadee Arunmas

The Commerce Ministry is taking steps to improve law enforcement in the agricultural sector to address the issue of nominees of foreign companies infringing on local businesses protected by the Foreign Business Act (FBA).

The move comes in response to complaints from Thai business operators who have felt the pinch from the influx of foreign firms doing business protected by the FBA.

These foreign firms doing business in Thailand typically use Thai nominees to make it look like they are Thai-owned and operated.

In recent years Chinese traders have entered Thailand to operate fruit wholesaling businesses in provinces such as Chanthaburi and Chiang Mai, which produce fruits such as the durian and longan.

FRUIT  FOR EXPORT ONLY

Sales of fruit to export markets is the only kind of business that foreign fruit traders are legally allowed to do in Thailand.

However, many foreign fruit traders sell products locally also, which is prohibited under the 1999 Foreign Business Act (FBA).

Thailand exported 12.6 billion baht worth of fruit to China in 2014, up from 4.42 billion in 2007.

In Chanthaburi alone, there are about 100 fruit wholesale operations, but 60% are owned by foreigners or have Thai people as nominee owners.

A number of foreigners also operate restaurants without obtaining permission from the Commerce Ministry.

This has prompted the ministry to take measures to ensure the FBA is enforced.

Deputy Commerce Minister Suvit Maesincee also said Thailand would take into account all related laws and regulations governing fruit and vegetable trading -- such as the Foreign Business Act, the Price of Goods and Services Act and agriculture-related acts -- to prevent traders with "unknown backgrounds and sources" from contacting fruit farmers directly and handling their own business instead of going through Thai brokers.

CHANTHABURI MODEL TO DEAL WITH INFLUX OF FOREIGN TRADERS

In a move to tackle the influx of foreign traders, mainly from China, who talk directly to farmers at Thai orchards and export directly to China, the Commerce Ministry yesterday launched the so-called "Chanthaburi model".

Under the scheme, Chinese traders who want to buy fruit directly from farmers in Chanthaburi province are required to register with the Agriculture Department. The produce they buy must pass good agricultural practice (GAP) standards.

The purchase contract also must be conducted in a manner fair to Thai farmers.

To buy and sell in the domestic market, they must first seek approval from the Commerce Ministry, as the practice is regarded as retailing and wholesaling in the annexes of List 3 (see below).

FREEING UP SOME BUSINESSES FOR FOREIGN COMPETITION

Thailand is on course to free up certain kinds of business for foreigners, especially in those sectors where Thai operators are able to compete with foreigners.

Some businesses listed on the annexes for List 3 of the FBA will be considered for removal.

Several public hearings have been held in recent months with operators in sectors that are deemed ready for competition.

LIST 3 OF FOREIGN BUSINESS ACT (FBA)

List 3 is a group of businesses in which Thais are deemed not ready to compete with foreigners.

Foreigners seeking to engage in List 3 activities are required to apply for and obtain a special foreign business licence before beginning operations.

The government was considering allowing 10-11 sectors to have foreign investment.

These sectors include leasing, loan finance, representative offices, regional offices and businesses that operate as partners or under government contracts.

The government earlier agreed to liberalise foreign investment in four other businesses: commercial banks, representative offices of foreign banks, life insurance and non-life insurance.

http://www.bangkokpost.com/business/news/884012/clampdown-planned-on-fruit-dealers

http://www.bangkokpost.com/business/news/879672/ministry-to-clamp-down-on-illegal-foreign-traders

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Vocabulary:

Act : a law passed by a country’s government - กฎหมาย

address : to try to deal with a problem or question - จัดการกับปัญหา

agricultural (adj): of the science or practice of farming - ที่เกี่ยวกับเกษตรกรรม

allow : to let somebody/something do something; to let something happen or be done - อนุญาต, ยอมรับ

annex (noun): a section of extra information that is added to something - ภาคผนวก

approval : official permission - การอนุมัต

background (adj): of the general situation in which something happens - บื้องหลัง, หลังฉาก

broker : a person or company who arranges something such as a deal, agreement, a job, etc. - นายหน้า

Commerce Ministry : the Thai government ministry focusing on internal and external tarde, ensuring free and fair trade and protecting consumers - กระทรวงพาณิชย์

compete : to try to be more successful or better than somebody else who is trying to do the same as you - แข่งขัน

complaint : when someone says that something is wrong or not satisfactory - การบ่น, ข้อที่ไม่พอใจ

conduct : to carry out — - ดำเนิน

contact (noun): having communication with someone - การติดต่อ การสัมผัส

deemed : considered - เห็นว่า ถือว่า

deputy : a person whose rank is immediately below that of the leader of an organisation - รอง

directly (adv): in a direct line or manner; immediately - โดยตรง, ทันที

domestic : inside the country being talked about - ภายในประเทศ

enforce  : to make sure laws are obeyed - บังคับให้ใช้, บังคับให้ทำ, ใช้กำลังบังคับให้ปฏิบัติตาม

ensure : to make certain that something happens or is done - ให้การยืนยัน, รับรอง, ให้ความมั่นใจ

export : the selling and transporting of goods to another country - สินค้าออก, การส่งสินค้าออกไปต่างประเทศ

felt the pinch : to be negatively affected by something - มีปัญหาเรื่องการขาดแคลนบางสิ่งบางอย่าง

firm : a business or company - บริษัท

govern : to control the way that things happen - ควบคุม, บังคับ, ครอบงำ

handle : to deal with a situation, a person, an area of work or a strong emotion - ควบคุม, ปฏิบัติ,จัดการ

improve : to make better - ทำให้ดีขึ้น

influx : a large number of people or things coming in to a place - การหลั่งไหล การไหลบ่า  (เข้าไปยังที่ใดที่หนึ่ง)

infringe : to break a law or rule; to limit somebody's legal rights - ฝ่าฝืน, ละเมิด

infringe on : to take away some of a person’s rights or to limit their freedom - ล่วงละเมิด, ละเมิด

issue : a subject that people discuss or argue about - ประเด็น

law enforcement : the process of making sure that people obey the law - การบังคับใช้กฎหมาย

legally : correct according to the law - ตามกฎหมาย

local (adjective): in this country (Thailand) -

locally : in or related to the area that you live, or to the particular area that you are talking about - ในท้องถิ่น, ในประเทศ

manner : way - ลักษณะท่าทาง, กิริยาท่าทาง, วิธีการ

measure : a firm action taken to solve a problem or stop a dangerous unpleasant situation - มาตราการ

ministry : a government department that has a particular area of responsibility - กระทรวง

move (noun): action -

nominee : a legal arrangement whereby investments are held by a a person or company on behalf of the real owner - ผู้รับถือหุ้นให้บุคคลอื่นที่ไม่ต้องการจะเปิดเผยตัวตน

obtain : to get something that you want or need, especially by going through a process that is difficult - ได้มา, ได้รับ

on course : going in the right direction -

operate : to carry out an activity like running a business - ดำเนินการ

operator (noun): a person or company that runs a business - ผู้ดำเนินกิจการทางธุรกิจ, ผู้ประกอบธุรกิจ

orchard : an area of land where fruit trees are grown - สวนหรือแปลงผลไม้

permission : allowing someone to do something - การอนุญาต,การอนุมัติ,การยินยอม

practice : a way of doing something - การปฏิบัติ

produce : things that have been made or grown, especially things connected with farming - ผลผลิต, ผลิตผล

prohibit : to officially stop something from being done, especially by making it illegal - มีคำสั่ง)ห้าม

prompt : to cause someone to take action - กระตุ้น

public hearing : an official meeting at which the facts about a situation, etc. are discussed with members of the public taking part - ประชาพิจารณ์

purchase : the process of buying something - การซื้อ

recent : happening or starting a short time ago - เร็วๆ นี้

register : to put your name and other information on an official list in order to be allowed to do something, e.g., vote, study, stay in a hotel etc - ลงทะเบียน

regulations : official rules that control the way that things are done - ระเบียบปฏิบัติ

removal : taking something away - การเอาออกจาก

response : a reaction to something that has happened or been said - การตอบสนอง

retail : to sell directly to the public for their own use - ขายปลีก

scheme : a plan that is developed by a government or large organisation in order to provide a particular service for people - แผนการ โครงการ

sector : a part of a country’s economic or business activity - ภาค (เศรษฐกิจ)

sector : a part of a country’s economy or business activity - ภาคเศรษฐกิจของประเทศ

source : the place something comes from or starts at, or the cause of something - แหล่ง, แหล่งกำเนิด

standards : a level of quality that is normal or acceptable for a particular person or in a particular situation - มาตรฐาน, บรรทัดฐาน

tackle : to make an organised and determined attempt to deal with a problem - จัดการกับปัญหา

take into account : to consider; to think carefully about the various factors involved before making a decision or developing an opinion - พิจารณา, คิดอย่างละเอียด

taking steps to : taking some action to achieve some goal or solve some problem -

trade : the buying and selling of goods and services - การค้าขาย

trader : someone who buys and sells things - ผู้ค้า

unknown (adj.): someone who you do not know who they are; unfamiliar - ที่ไม่รู้, ที่ไม่เป็นเป็นรู้จัก

wholesale : relating to the business of selling large quantities of goods, especially to people who are going to sell them in a shop - ขายส่ง

wholesaling : relating to the business of selling large quantities of goods, especially to people who are going to sell them in a shop - ขายส่ง

worth : having a value in money, etc - มีค่า, มีมูลค่า

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