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A source said TOT had already notified SIM, which has agreed to withdraw the civil lawsuit against TOT once it receives the sum from the state agency. However, SIM executives could not be reached to confirm the report.

SIM filed a civil lawsuit against TOT and CAT Telecom, both shareholders of Thai Mobile, last December to claim outstanding fees of Bt1.115 billion. SIM also demanded another Bt1.533 billion in damages, including interest on the outstanding amount.

SIM stopped providing services to Thai Mobile last June after it decided to stop waiting for overdue bills. TOT said some contract conditions were "unfair", especially the fixed-rate billing.

According to the contract, which expired last October, SIM was charging each subscriber a service fee of Bt80 per month or a minimum of Bt10 million.

The billing fee was set at a flat rate of Bt1.8 billion for the life of the contract, which expires next year. As of June, at which time SIM had stopped providing the service, Thai Mobile had paid Bt600 million of the total.

Thai Mobile commenced service in 2003 and hired SIM in 2002 to handle customer service, billing and distributing numbers to dealers. TOT shut down Thai Mobile on Tuesday as a step toward the development of its third-generation mobile broadband service.