Thailand Law Journal 2009 Spring Issue 1 Volume 12

In addition, Authorization Directive imposes a supplementary scheme of “general authorization” to support the technological neutrality. General authorizations allow any undertaking to build networks and offer services, subject only to general conditions that are more readily changed and adapted than the previous system of individual licenses.⁸⁸ NRAs can only limit the number of operators in a market when there are scarce resources at stake, notably radio spectrum or numbering ranges.⁸⁹ Moreover, there has been a fundamental shift of spectrum management to a situation where it needs a coherent policy approach, driven by social and economic objectives, in order for transitioning to digital television.⁹⁰ Universal Service Directive also provided that Member States shall ensure the interoperability of the consumer digital television equipment.⁹¹ Also, the secondary trading of spectrum has been initiated and be expected to lead to more flexibility in accessing radio spectrum. With respect to spectrum, this will depart from technology constraints and develop a regulatory approach which allowing operators to sell unwanted radio frequency to each other, thus reducing the risk to operators of buying the right to use radio frequency and further encouraging new operators to enter the market.⁹²

In sum, the EU telecommunications have made a significant transitioning step to electronic communications in order to cope with technological advancement. It is also an aim to transition to general competition, but dealing with internal market harmonization simultaneously. In a prospect of interconnection, the new framework will impose obligations only when necessary procedures to analyze the market have been completed, with a result that will lead to ineffective competition. There is no further substantive provision on the issue. It is focused on procedures and collaborations between its organizations. Its transitioning seems not to be unfolded to general competition in very soon. Rather, the EU electronic communications will prepare Member States and organizations in line with market-based approach, and be able to further transition to general competition of EU internal market.

It could now be noted that EU electronic communications framework is strong in term of its prescriptive principles with objectives for liberalizing and harmonizing the internal market. Those organizations prescribed by the framework have recently established and functioned its role; however, they are not truly new organizations in the truly new system. Therefore, those organizations are well functioning. Actually, the EU systems have been developed as a part of underlying principle of internal market in order to promote competition. Member States and relevant organizations have gradually evolved since The Treaty of Rome (1957). Therefore, they are well-positioned, in transitioning towards general competition of internal market, due to their considerable experiences and collective will.

3. A Case Study of Thailand

To provide overview information of Thailand, the total population is now about 62 millions in 513,115.02 square kilometers of total area. GDP is about 4,688 billions baht⁹³ and 2,759 GDP per capita in 2005. Average GDP growth is about 5.0% per year.⁹⁴Specifically in the sector of telecommunications, it enjoys the continually growth in the number of cellular mobile phone subscribers and internet users. With a very high growth of both subscribers and service coverage in 2001-2003, operators moved very quickly to reap the greatest rewards⁹⁵ even when the regulatory environment is still unclear. Following will describe Thailand’s characteristics in telecommunication industry in order to subsequently conclude that there is an opportunity for frog-leaping towards general competition with a light-handed approach.

3.1 Industry Overview and the Phasing-in

Similar to most countries, the telecommunication industry in Thailand began with its arising infrastructures provided solely by the government. It was regarded as the wise and advanced initiation of the country since the Ministry of Defense had imported the telegraph and telephone technology to accommodate its administration; then they decided to provide these services to citizens. The government began to provide telegraph and telephone services by establishing the Telegraph Department in 1884.⁹⁶ It was not considered a form of monopoly because the government was the only potential capital holder being able to fund, build, and operate telegraph and telephone services. The only consideration was how can a nation raise funds and provide adequate infrastructures in a least-developed country - needless to say about its deficit in technology research and development.

This was the beginning of the first phase; the government provided nationwide communications via monopoly regime. They enacted laws concerning wire and wireless technologies including Radio Telegraphy Act of 1914⁹⁷, Telegraphy and Telephony Act of 1934⁹⁸, Radio Communications Act of 1935⁹⁹, Radio Communications Act of 1955¹⁰⁰, and Radio and Television Broadcasting Act of 1955.¹⁰¹ After providing telegraphy and telephony services for 70 years, the government introduced a state-owned enterprise, namely “Telephone Organization of Thailand” (TOT) in 1954¹⁰² to provide a nationwide and a monopolized telephone service. In addition, the Communication Authority of Thailand (CAT) was established to provide all kinds of telecommunication services and related services other than telephone services in 1976.¹⁰³ However, it was a general understanding that TOT served for domestic telecommunications; while CAT served for international telecommunications, which reflected from the viewpoint of technologies before the age of the computer networking and the internet.

The industry was introduced to the second phase of indirect competition. According to its monopoly market, the government granted concessions and gave rises to private telecommunication companies via its telecommunication agencies. There is a range and complexity of the concessions granted to private companies by various governmental agencies over the years. It is noted that it was not expecting for competition in this phase. Those private companies have been entitled to enjoy monopoly power of their agencies in return to sizeable investments into telecommunication infrastructures. There have been one fixed line telephone concession for the metropolitan area and another concession for provincial areas. In addition, there has been a mobile telephone concession for each frequency band, a concession of satellite communication, a concession of optical network, etc. Every concession has been done under the Build-Transfer-Operate scheme. However, according to applications of technologies, those private companies have marketed their businesses overlapping each other; the competition has been said to be introduced indirectly.

88 Directive 2002/20/EC, Article 3(1)
89 Directive 2002/20/EC, Article 3(3)
90 Reding, Viviane. “Reaping the full benefits of a more coherent European approach to spectrum management”. Remark at European Spectrum Management Conference-Brussels, <http://ec.europa.eu/commission_barroso/ reding/docs/speeches/esmc_20060329.pdf>, 29 March 2006
91 Directive 2002/22/EC, Article 24.
92 Liikanen, Erkki. “Mobile Communications and the EU’s New Regulatory Framework”. Remark at IFT World Mobile Communications Conference-London, <http://europa.eu/rapid/pressReleasesAction.do?reference= SPEECH/04/232&format=PDF&aged=1&language=EN&guiLanguage=en>, 10 May 2004
93 Ministry of Finance, “Economic Data”, <http://www2.mof.go.th/econ_data.htm#thai_glance>
94 Telenor, infra note 116
95 Sriswasdi, Rachaneekorn, “A report on the Thai market for Wireless Telecommunications”, International Market Research - Wireless Telecommunications, <http://strategis.ic.gc.ca/epic/ site/imrri.nsf/en/ gr113839e.html>
96 The Act establishing the Telegraph Department of 1884, under the reign of King Chulalongkorn (Rama V)
97 The Act was aimed to give the Post and Telegraph Department (PTD) monopoly power over radio telegraphy and radio telephony businesses, as amended 1921 and 1930.
98 The Act was aimed to give the Post and Telegraph Department (PTD) monopoly power over telegraphy, and telephony businesses, as amended 1974.
99 The Act was aimed to control private radio communications and broadcasting businesses by licensing regime, as amended 1938, 1940, 1942, 1948, and 1954.
100 The Act was aimed to regulate public and private radio communications businesses by licensing regime which is an end of radio communication monopoly, as amended 1961 and 1990.
101 The Act was aimed to regulate radio and television broadcasting businesses including cable television by licensing regime which is an end of broadcasting monopoly, as amended 1959, 1978, 1987.
102 The Act establishing “Telephone Organization of Thailand” (TOT) of 1954, which aimed to provide monopoly telephone services as a separated business organization from the Department of Post and Telegraphy, under supervision of the Ministry of Transportation. (TOT’s coverage was limited to metropolitan area: Bangkok and vicinities, at the beginning, and then be expanded to nationwide.)
103 The Act establishing “The Communication Authority of Thailand” (CAT) of 1976, which aimed to provide all kinds of postal and telecommunication services as a separated business organization from the Department of Post and Telegraphy, under supervision of the Ministry of Transportation.

This article is published with the kind permission of Piyabutr Bunaramrueang, Professor of Law at the School of Law, University of the Thai Chamber of Commerce. This article was presented at the 2007 ALIN International Academic Conference at Chulalongkorn University. Except where otherwise noted, content on this site is licensed under a Creative Commons Attribution 3.0 License, <http://cc.in.th/wiki/by_f>