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Published on November 13, 2007

The Commerce Ministry will forward the country's first Retail Business Act for National Legislative Assembly (NLA) consideration tomorrow in a bid to pass the law within the current government's term.

The Act will be a priority for the NLA, because the government wants to ensure it is implemented before it leaves office, Skol Harnsuthivarin, secretary to the commerce minister, said yesterday.

Skol also hit back at an executive from Thailand's largest retailer, Tesco Lotus, who said the Act would be inefficient in operating the retail sector.

Skol said the government had considered the Act very carefully. It would protect consumers from unfair dominance by giant retailers and prevent some retailers from monopolising the market by offering short-term low prices to attract customers.

The Act will ensure that the country's retail industry is not monopolised by only one giant company in the long term, he said.

Meanwhile, to ensure that small retailers will be protected from the giants, the Commerce Ministry is meeting today with 100 retail and wholesale operators to revise its retail guidelines.

Internal Trade Department director-general Yangyong Phuangrach said the ministry found that the current regulations were inefficient in controlling the retail giants.

"The ministry must revise the current guidelines, to help protect small retailers and create fair regulations for all relevant sectors," he said.

The guidelines will be part of the Retail Business Act. They have been in effect since October 12, 2006, and will be integrated into the new law, because the government wants to protect small operators with limited bargaining power against big retailers that may force them to sell products at very low prices.

Under the guidelines, eight regulations have been created to protect manufacturers and suppliers from the giants.

They cover price dumping, collection of entrance fees, unfair product-return policies, using unfair trading contracts, forcing suppliers or retailers to purchase or pay for special costs, unfair use of a supplier's workforce, forcing manufacturers or retailers to promote house brands and refusing to purchase all or some made-to-order products.

Yangyong said the ministry would concentrate on revising the guidelines by creating tighter regulations to protect consumers from extravagant advertising and unfair promotions.

Segsarn Trai-Ukos, corporate affairs and business development director at CenCar, the operator of Carrefour in Thailand, said his company fully supported the Retail Business Act and the guidelines in ensuring fair practice for both giant and small retailers.

"The head office also agreed to follow this Act, because we've foreseen it will create room for all players rather than block foreign operators like some may fear," he said.

Segsarn said his firm had agreed with the ministry to revise its retail guidelines, such as by having a specific period for discount promotions.

Petchanet Pratruangkrai

The Nation