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Thai telco regulator faces lawsuit for double taxation law

Satellite operators in Thailand are threatening to sue the National Broadcasting and Telecommunications Commission over its proposal for a new taxation regulation.
Written by Liau Yun Qing, Contributor

The Satellite Television Association (STA) of Thailand is opposing a proposed new regulation by National Broadcasting and Telecommunications Commission (NBTC) which will implement a double tax, and plans to bring the regulator to court.

Bangkok Post reported Friday the STA was preparing a petition for the Administrative Court against a new NBTC regulation which will charge a 2 percent licensing fee on satellite TV operators' annual revenue and another 2 percent universal service obligation (USO) tax on the same revenue. According to a report Friday on The Nation, the NBTC had finished drafting the new regulation which will go to public hearing on Dec. 27.

Bangkok Post cited STA chairman Niphon Naksompop as saying: "This regulation violates the law. It should be scrapped as the rates are too high for operators... A final decision on whether to file the petition will be made this month."

The English daily reported satellite TV operators generate a monthly revenue ranging from 1 million to 10 million baht (US$32,563 to US$325,627), with profit margins of 5 to 10 percent. In 2011, as many as 52 companies entered the Thai local satellite TV market, it added.

STA Secretary Pongchai Shanmartkit said the fees could create a barrier to entry for new market players, as small and midsize operators may find it difficult to survive in the market which will likely be controlled by the existing 10 large providers.

In November, two of Thailand's three telcos threatened to sue NBTC if the regulator further delayed issuing 3G licenses in the country. The regulator raised 41.6 billion baht (US$1.4 billion) from the spectrum auction which was held in October, but had not released the 15-year licenses because the Thai court had yet to rule if the auction was valid.

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