FOREIGN FIRMS FACE SCRUTINY

       The telecom regulator is drafting regulations to prevent much-disputed foreign dominance of the industry, but some telecom companies can breathe a sigh of relief as the new regulations will not be applied to the planned auction of 3G cellular licences.
       Under the new regulations, the National Telecommunications Commission will check whether the combined direct and indirect holdings of foreign investors in a telecom company reach the legal limit of 49 per cent, or if the voting rights of foreign shareholders, or their representatives, exceed their actual stakes.
       NTC deputy-secretary general Praset Apipunya said yesterday that all prospective bidders for the new 3G licences would be informed that the upcoming regulations would still apply to them after the 3G auction.
       The NTC reported on the draft regulations for foreign dominance to Prime Minister Abhisit Vejjajiva during the meeting of economic ministries yesterday to discuss the country's 3G wireless broadband development policy.
       Praset said the NTC had recently approved further work on the draft, which determines what constitutes foreign dominance and how to resolve such situations, after its development had been suspended.
       Foreign ownership of telecom companies - particularly Advanced Info Service(AIS) and Total Access Communication(DTAC) - has been in public focus.

       MAJOR STAKES
       Singapore's Temasek Holdings, through Cedar Holdings and Aspen Holdings, owns 96 per cent of Shin Corp, the holding company for AIS.
       Telenor Asia, an arm of Norway's Telenor, as of May, dircetly owned 34.98 per cent of DTAC. Its 49 per cent-owned Thai Telco Holdings owns 29.89 per cent of DTAC.
       Representatives of TOT, CAT Telecom, the NTC and the Information and Communications Technology Ministry also joined the economic ministers' meeting to explain their 3G plans.
       The Council of Economic Ministers meeting also discussed the foreign ownership issue.
       The members asked the NTC to make sure that its auction terms and conditions are fair and comply with all laws that control alien shareholdings in Thai firms, said Puttipong Punnakan, vice minister to the PM's Office.
       They also asked the NTC to proceed cautionsly with its plan to auction the 3G licences, which will use the 2.1GHz spectrum.
       The meeting also ordered the ICT Ministry to adjust the strategies of TOT and CAT to be in line with planned market liberalisation and the awarding of 3G-2.1GHz licences. The auction will open the way for more 3G players besides TOT and CAT.
       TOT will kick off its 3G-2.1GHz service in greater Bangkok on December 3 and plans to roll out a nationwide 3G network next year at a cost of about Bt20 billion.
       CAT already provides a 3G service via its Code Division Multiple Access(CDMA) 2000 1-x cellular network in 51 provinces. The NTC will next Thursday announce the starting bids for the auction, NTC secretary-general Suranan Wongvihayakamjorn said.
       The NTC will hold its second public hearing on the auction 5 and will also consult with the Council of State soon on whether it has full authority to auction the new spectrum licences.
       The NTC hopes to hold the auction in December.