True Corp to Appeal $124.3 Million Arbitration Ruling in Telecom Dispute

True Corporation has announced its intent to challenge a recent ruling by the Central Administrative Court in Thailand, which dismissed the company’s appeal against an arbitration decision that requires it to pay THB4 billion (approximately $124.3 million) plus interest to National Telecom (NT). This significant legal development highlights a long-standing dispute in Thailand’s evolving telecommunications industry and sets the stage for further legal actions in the Supreme Administrative Court.

The Background of the Dispute

The case dates back to alleged additional interconnection fees claimed by CAT Telecom, which later merged with another entity to form the state-owned National Telecom (NT). In October 2019, CAT telecom initiated arbitration proceedings at the Thailand Arbitration Centre, demanding payments from True for what it cited as due interconnection charges. The arbitration panel ruled in CAT’s favor, sparking the legal journey that has now prompted involvement from higher courts. Importantly, the court has refined some details of the judgment, including adjustments to the initially high-interest rates set in the arbitration decision.

Details of the Court Judgment

Among the key amendments made by the court to the original arbitration ruling is the revision of the interest rate associated with the disputed payment. The interest rate, initially deemed too high, was lowered to 7.5% for the period from November 2012 to April 2021. From April 2021 onward, the rate was further reduced to 5% until the debt is paid in full. Despite these adjustments, True Corp has expressed strong disagreement with the judgment and is prepared to escalate the matter by filing an additional appeal to the Supreme Administrative Court within the stipulated 30-day period.

Future Implications for Thailand’s Telecom Sector

This case underscores the complexities of regulatory and interconnection fee disputes in the competitive telecom markets of Thailand. The merger of CAT Telecom and TOT to form National Telecom in 2021 added a new dynamic to legacy agreements and financial obligations, such as those under debate in this case. While True Corp has stressed that the current judgment doesn’t enforce any immediate payment, the eventual decision by the Supreme Administrative Court could set precedent for future disputes in the region’s telecommunications sector. Telecom operators and stakeholders are closely monitoring the developments for their potential impact on business operations and regulatory frameworks.

Overall, this ongoing legal battle serves as a reminder of the intricate balance between regulatory compliance and maintaining business relationships in the telecom industry. As True Corp embarks on the next phase of its legal challenge, the industry watches with anticipation to see how Thailand’s administrative courts address this large-scale dispute.