Question as to whether duty-free shops come under PPP Act after PM raised monopoly concerns
King Power’s duty-free shop at Suvarnabhumi airport. The Thai Retailers Association is prepared to protest AoT’s terms of reference for duty-free shops.
A working panel has been set up by the government to consider whether the bidding process for the duty-free shop concession falls under the Public-Private Partnership (PPP) Act.
The working panel will also look into whether the auction for non-duty-free commercial operations at Suvarnabhumi, Phuket, Hat Yai and Chiang Mai airports will come under the newly amended PPP Act.
The PPP Committee meeting, chaired by Prime Minister Prayut Chan-o-cha, agreed to set up the working panel to study the issue after continued controversy surrounding the concession bid.
In the middle of this month, the Transport Ministry halted an Airports of Thailand (AoT) plan to auction a single concession to run duty-free shops at the four airports after the prime minister raised concerns that the business would be a monopoly.
A source from Government House requesting anonymity said the working panel, chaired by the attorney-general, was ordered to finish the study and report to the PPP Committee as soon as possible.
The source said that if the auction is found to be subject to the PPP law, an ad hoc committee must be established to supervise the auction.
Friday’s meeting was the first under the PPP Act of 2019, which was approved by the National Legislative Assembly on Jan 31.
Last week, the Thai Retailers Association (TRA) threatened to team up with leading foreign duty-free shop operators to protest against AoT’s terms of reference (ToR) for the duty-free shop concession, which appear to encourage unfair competition.
The TRA also repeated its call for AoT to revise its ToR to ensure fairness and transparency.
The association recommends AoT split the concessions based on product categories and split the operations into three different concessions: one for Suvarnabhumi airport, one for Phuket airport and another for both Chiang Mai and Hat Yai airports.
The TRA also urged the bidding process to be thoroughly evaluated, with equal weight placed on technical complexity and financial returns.
Furthermore, AoT should disclose data pertaining to the value of total sales, the nationalities of the buyers and the type of items they are purchasing, as is standard practice at international airports serving Hong Kong, South Korea and Singapore, the TRA said.
For large-scale bids, bidders should be given at least 60-90 days to prepare, the association suggested.
The association urged the next government to pay close attention to the issue because duty-free operations are a significant source of income for the country.
“AoT should pay more attention to good governance and set a good example for other government agencies,” said TRA president Worawoot Ounjai.
Source: Bangkok Post