The impending Charoen Pokphand Group's Tesco buyout will be explained by the companies to the House Committee on Commerce and Intellectual Property on Wednesday.
Representatives of Tesco Plc and the CP Group will disclose details of the acquisition deal at the committee's invitation, said Sirikanya Tansakun, chairwoman of the committee.
Earlier, the committee invited Somsak Kiatchailak, secretary-general of the Office of Trade Competition Commission (OTCC), to testify about the matter.
The government's competition watchdog early last month approved the Group's US$10.6-billion acquisition of the British supermarket's Thai operations. The deal would see CP acquire 86.9% of Tesco's Thai operations and 100% of the UK retailer's Malaysian business, prospects that many say give the company an unfair hold on the retail sector in Thailand.
It was reported on Dec 9 that Britain's biggest retailer, Tesco Plc, expects to complete the US$10.6 billion (318 billion baht) sale of its Asian businesses to CP Group on Dec 18, paving the way for a return of £5 billion (199 billion baht) to shareholders. Tesco agreed to sell its businesses in Thailand and Malaysia to CP Group in March.
CP Group is satisfied with the formal notice of approval from the OTCC, sources say. Several trade commissioners have warned the controversial acquisition of Tesco by CP Group could leave lasting damage on the economy.
Santichai Santawanpas, commissioner of the Office of Trade Competition Commission (OTCC) and the office's spokesman, one of the three minority members who voted against the CP-Tesco deal, said the merger could allow monopolies to flourish.
He said companies that are already manufacturers of raw and processed food have the potential to dominate a market once they venture into wholesale and retail businesses.
Under the deal, CP would acquire 86.9% of Tesco's Thai operations and 100% of the UK retailer's Malaysian business. As CP already owns the country's 7-Eleven concession and Makro cash-and-carry stores, all of which operate in the market sector, the CP-Tesco deal is seen as strengthening CP's position.
However, the commission has imposed seven measures and conditions for CP to follow to alleviate possible impacts. Among them is a three-year ban on another acquisition in the modern trade sector, excluding e-commerce.
CP All, the retail subsidiary of CP, and Ek-Chai Distribution System, which operates Tesco Lotus Express, are also required to increase sale volumes of agricultural and community products supplied by SMEs or Otop products by at least 10% on the previous year for five consecutive years.
Yesterday, Ms Sirikanya said the committee has formed a panel to monitor the impact of the deal.
The committee also said the Trade Competition Act, despite having been revised, was flawed and suggested it be amended particularly in the make-up of the panel to select OTCC members.
She said the selection panel is full of bureaucrats and representatives of the chambers of commerce and industry councils. However, it lacks commissioners with a working background in consumer protection.
The OTCC rulings should also be open for scrutiny by the public. The maximum 90-day period for following up should be extended to 180 days especially in high-value cases.
Sakon Varunyuwatana, chairman of the OTCC, said the trade competition commissioners were drafting their individual rulings in the Tesco-CP case, as required by the revised Trade Competition Act. However, the law does not set a drafting deadline.
"But as commissioners we have all agreed the written ruling should be completed soon, recognising that society is keeping watch of the issue."
A source in the OTCC said the rulings could be unveiled this week.