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Published on December 1, 2007

The Supreme Administrative Court will make a landmark ruling on December 14 that could cause PTT to be delisted from the Stock Exchange of Thailand if its privatisation is found to be unlawful.

The court yesterday heard the testimonies given by PTT and the consumer groups who filed the case against the privatisation.

Presiding judge Jaran Hatthakam heard the evidence given by PTT president Prasert Bunsumpun, who verbally defended the privatisation process as transparent. The consumer groups claimed that the privatisation was unlawful because it eliminated the state's control and bargaining power over PTT, which was against the law governing PTT.

The court refused to give any opinion ahead of the hearing, which was conducted behind closed doors at the request of PTT.

Prasert said after the 45-minute hearing that PTT had explained to the court the nature of its business to make its point that the privatisation had been done transparently.

Asked if PTT would win, he said: "I have no idea, and I can't answer. We have given all information to the Court on how the PTT privatisation has benefited the public. Now it depends on the judge."

Saree Ongsomwang, on behalf of the Foundation for Consumers, which filed the case, said: "The foundation still believes that the unlawful privatisation has greatly benefited PTT executives who have PTT shares. PTT shares rose rapidly from the date we filed the case. They were Bt35 a share on August, 31, 2006. They then rose to Bt440. This money went into the pockets of a select group of politicians and others, even though PTT is a national asset."

The Foundation for Consumers filed a complaint with the Supreme Administrative Court on August 31, 2006. That complaint named the Cabinet, the prime minister and the energy minister at the time as respondents and sought a court order revoking the 2001 Royal Decree Determining the Powers, Rights and Benefits of PTT Plc and 2001 Royal Decree Determining the Time for Repealing Laws Governing the Petroleum Authority of Thailand.

In front of the Court yesterday, around 20 people from the consumer groups held a banner reading: "People want to see PTT returned to the country's assets."

The groups argued that the decrees were unlawful as they breached the law that states that the objective of the control of oil and gas prices is to ensure national security and the common interest.

Nakorn Chompoochat, the lawyer for the consumer groups, said yesterday they had reaffirmed their points to the court. The PTT, meanwhile, cited the legitimacy of the royal degree governing privatisation and also the future burden if PTT had to be delisted, such as the large amount of money needed to buy back PTT shares from the current shareholders.

Nakorn said: "The claim over the future damage to PTT executives was irrelevant to the issue of the unlawful royal degree to privatise the PTT. They tried to convince the judges that if the court ruled justly, the decision would damage PTT. Nonetheless, I believe the court will rule based on the factual information."

Some businessmen earlier argued the delisting would affect foreign-investor confidence in the Thai market.

Rossana Tositrakul, a director of the Federation of Consumer Organisations, said that she disagreed with PTT's argument, which claimed the delisting of PTT would affect investor confidence, as unreasonable because PTT was held by "nominee" families with political connections.

The groups filed the case last year after they successfully called on the court to nullify the two decrees that supported the privatisation of the Electricity Generating Authority of Thailand (Egat). Caretaker Prime Minister Thaksin Shinawatra, the Cabinet and Energy Minister Viset Choopiban were highlighted as defendants.

The petitioners also said some part of PTT's land was a national asset and should not have been privatised. They said the privatisation had created a private monopoly of the oil and gas industry and that the government had failed to establish an efficient regulatory framework, putting nation and consumers at a disadvantage.

The respondents said that if PTT had to be delisted it would create confusion among the public and damage the economy and the confidence of foreigners investing in the Thai market.

Business Reporters

The Nation