Sitthichai's stance follows a letter from the Office of the Auditor-General asking that the deal be reviewed because of suspicions that it does not comply with regulations governing joint businesses between the state and private sectors. The board of CAT Telecom, a state agency, recently sought the Council of State ruling on whether the deal with Hutchison complies with the regulations after a board member raised questions on the issue.

Hutchison-CAT is a 75:25 joint venture between Hutchison Telecom and CAT. CAT has awarded Hutchison-CAT a contract to market a Code Division Multiple Access (CDMA) 2000 1-x broadband cellular service in 25 provinces. The service runs on a network leased by Hutchison-CAT from a firm called BFKT, which is a wholly owned subsidiary of Hutchison Telecom.

"If the Council of State rules that the deal is not in line with the regulations, I will take full action to find out who's responsible for the mistake," Sitthichai said.

Currently, Hutchison-CAT has about 750,000 subscribers. Under the marketing deal between CAT Telecom and Hutchison-CAT, the latter will pay a minimum of Bt7.9 billion to the state agency over the 15-year contract period.

CAT granted the deal to Hutchison-CAT in 2000. Hutchison-CAT launched the service in 2003 and it has already generated Bt3 billion in revenue for the state agency.

The auditor general's letter informed the ICT ministry that it was also investigating a decision by CAT's board against fining Chinese telecom equipment supplier Huawei Technologies for failing to deliver on schedule to CAT the first phase of the CDMA network in another 51 provinces.

Huawei was contracted to hand over the first phase of the network on January 26 this year, after installing it and testing it jointly with CAT.

On January 17, CAT said that even though Huawei had completed installing the first phase of the network, neither Huawei nor CAT had started testing it, due mainly to heavy flooding in the North and South late last year.

Huawei has since handed over the first-phase network to CAT and is installing the remaining 800 base stations in the project's second phase in 51 provinces.

CAT is currently negotiating with Hutchison-CAT to jointly provide a CDMA cellular service across the whole country via their two separate networks, one covering 25 provinces and the other 51 provinces.

Sitthichai said he had already asked the ministry's legal unit to see if there are any laws giving the minister more power to intervene in all the projects.

Telecom Reporters

The Nation