AoT urged to split duty-free concessions

AoT urged to split duty-free concessions

Worawoot: Calls for ToR revision
Worawoot: Calls for ToR revision

A group of Thai retailers has threatened to team up with leading foreign duty-free shop operators to protest against the Airports of Thailand's (AoT) controversial terms of reference (ToR) for the duty-free shop concession, which appear to encourage unfair competition.

Worawoot Ounjai, Thai Retailers Association (TRA)'s president, said on Wednesday the recent announcement by the AoT to merge permits for duty-free operations in four airports into a single concession as "monopolistic".

The association also repeated its call for the embattled AoT to revise its ToR to ensure fairness and transparency in the process.

The association recommends the AoT split the concessions based on product categories, and split the operations into three different concessions -- one for Suvarnabhumi airport, one for Phuket airport, and another for both Chiang Mai and Hat Yai airports.

The association also urged the bidding process to be thoroughly evaluated, with equal weight placed on technical complexity, as well as financial returns.

Furthermore, the AoT should disclose data pertaining to the value of total sales, the nationalities of the buyers and the type of items they are purchasing, which is considered standard practice in other international airports such as Hong Kong, South Korea, and Singapore, Mr Worawoot said.

For large-scale bids, he said, bidders should be given at least 60-90 days to prepare.

"As a listed company, the AoT should pay more attention to good governance and set a good example for other government agencies," he said.

In addition to coming up with suggestions for the management of duty-free operations, the association also called on authorities to clarify whether the bidding process for the concession falls under the recently amended Public-Private Partnership (PPP) law.

Mr Worawoot also urged the next government to pay close attention to the issue as duty-free operations are significant sources of income for the country.

Separately, Prime Minister Prayut Chan-o-cha said on Wednesday the duty-free shop bids should take into account three conditions -- entrepreneurs' competence, consumer benefits and contribution to the country's revenue stream. He also said the government will go ahead with its plan to open the bidding process, before pledging that no decisions "will be made in favour of certain parties".

Authorities are currently trying to resolve the controversy surrounding the duty-free concession bid, so that businesses and consumers can reap benefits from the new management model.

Last Friday, the Transport Ministry put the brakes on the AoT's plan to auction of the duty-free operations for the four airports under a single concession after Gen Prayut raised concerns about a monopoly.

"As a state enterprise under the ministry, the AoT is required to address all concerns," Transport Minister Arkhom Termpittayapaisith said.

The auction will be postponed until the AoT can assure that merging the concessions does not violate the amended PPP act.

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