The National Broadcasting and Telecommunications Commission submitted for the junta’s consideration yesterday the pros and cons on the AWN proposal to the NBTC’s telecom committee on Monday that it award a 900-megahertz licence to AWN. The company says it is willing to pay Bt75.654 billion for the slot, the same price that Jas Mobile Broadband quoted to win this band at an auction last December.

Prayut said the government’s decision on this case would be based on the country’s interest and legal principles. The government will assign the Council of State and Deputy Prime Minister Wissanu Krea-ngam to look into the matter.

Wissanu said AWN would have to be held responsible for the compensation if it makes the request to buy the licence but later changes its mind.

AWN, a subsidiary of Advanced Info Service (AIS), proposed to the telecom regulator on Monday that it award a 900MHz licence to AWN, which is willing to pay Bt75.654 billion for the band. If the NBTC agrees to the proposal, AWN will hold a shareholders’ meeting to ask for approval to buy the licence, but it could take two months to arrange such a meeting.

AIS’s share price yesterday plunged 6.86 per cent to close at Bt163. Investors are evidently concerned that the telecom giant’s earnings could be affected if it really buys the licence at such hefty price.

The NBTC called in AIS chief executive officer Somchai Lertsutiwong yesterday to talk about the compensation AIS would have to pay if it later decides not to buy the licence after all.

According to Total Access Communication CEO Lars Norling, DTAC currently has a very strong spectrum portfolio of 50MHz and it is confident about getting the bandwidth it needs to serve customers by 2018.

“On AWN’s willingness to pay Jas’s price for the 900MHz slot, we haven’t seen the alleged letter. DTAC will have to discuss this with its board before commenting,” he said.

At the December auction, Jas and True Corp subsidiary TrueMove H Universal Communication (TUC) each won a slot on the 900MHz band. But Jas defaulted on the initial instalment of the upfront fee, prompting the NBTC to plan a second auction for that slot.

AWN and DTAC TriNet of DTAC were the unsuccessful bidders in the December auction.

The NBTC members also approved the rules of the new auction yesterday, voting 5-3 to ban TUC from taking part in this new round of bidding to prevent the possibility of the company monopolising the market for fourth-generation wireless broadband.

Two commissioners were absent from the meeting yesterday.

The vote overturned the telecom committee’s previous resolution that TUC could join the auction.

A majority of the commissioners also approved the minimum starting bid of Bt75.65 billion. The bidders can raise the price by Bt152 million per round. The auction is to be held on June 24.

True has insisted that it would have to be compensated if the final bid in this new auction is lower than what Jas offered in December

The NBTC’s telecom committee yesterday did not consider the request. It just approved the draft rules and schedule for the second auction of a 900-megahertz licence, a committee source said.

AIS submitted the request in a confidential urgent letter to the NBTC on Wednesday, indicating that it was willing to pay a fee for using the 900MHz spectrum during this extended remedy period.

The fee would be based on the final bid that Jas Mobile Broadband made to win the 900MHz licence – Bt75.65 billion – in the first auction last December.

AIS had operated its 2G service on this 900MHz spectrum before the NBTC reclaimed it for auction. Jas Mobile won this slot but failed to pay the first instalment of the upfront licence fee.

AIS has 8.4 million subscribers, of whom 8 million are from its subsidiary Advanced Wireless Network but still roam with AIS’s 900MHz network.

AIS has claimed that it now uses only 5MHz of the 900MHz spectrum out of the total 10MHz, so it will pay for only 5MHz.

Meanwhile, the telecom committee proposed a minimum starting bid for the new auction of Bt75.65 billion, said Takorn Tantasit, secretary-general of the NBTC.

Under the proposed auction rules, each bidder can raise the price by Bt152 million for each round until the bidding ends at the same price that Jas Mobile missed paying.

The NBTC will also require bidders to place a bank guarantee for 5 per cent of the minimum bid, or Bt3.78 billion, prior to the auction, as opposed to lodging Bt644 million in cash as in the first auction.

If the winning bidder fails to make the first payment it will be fined Bt11.35 billion or 15 per cent of the starting bid.

If the winner fails to fulfil the initial payment condition on time, the licence will be awarded to the second-highest bidder.

If there is only one bidder, the auction will still go ahead, as the starting price is already high.

The draft rule for the auction bans Jas from entering this bid.

The telecom committee will submit the proposed auction rules for the NBTC’s consideration on Tuesday, and will hold a public hearing on April 22.

Auction participants will be invited from May 13 to June 12, with prospective bidders submitting documents on June 14.

The NBTC will hold the auction on June 24.

The NBTC will call a meeting with Pete Bodharamik, chief executive officer of Jasmine International, on Tuesday to ask for his explanation of Jas Mobile Broadband’s failure to make the initial upfront licence payment by the March 21 deadline, Takorn said.

The commission will ask for more information from Pete on the company’s preparation to bid for the licence and if Jasmine had set a budget for this.

It will examine the stock trading of executives and board directors of Jasmine group.

Its probe will focus on whether Jas actually intended to bid for the licence and will see if there is evidence that Jas really sought financial support from banks for its bid.

The panel will ascertain the |possible damage to NBTC from this case and see if it could affect Jasmine’s businesses that hold NBTC licences.

A National Broadcasting and Telecommunications Commission source said that the clause may be scrapped because the potential starting bid price for the new auction was already high at more than Bt75.6 billion.

That was the price Jas Mobile Broadband quoted to win the licence in December but then forfeited it after failing to pay for the initial licence upfront fee by last Monday’s deadline

“One difference between the first 900MHz auction and this upcoming one is the first one focused on promoting price competition with a starting price of Bt12.88 billion, while for this new one the possible starting price is already high,” the source said.

Telecom commissioner Pravit Leestapornvongsa said that some key rules the telecom committee had to consider carefully included the possibility of the auction continuing even if there were only one bidder.

However, Pravit said allowing that to happen must be contingent on the auction rules clearly stating that an acceptable price must be achieved.

If there were no auction, the telecom committee would keep the licence for one year at least, according to its previous resolution. But Pravit is doubtful whether this resolution might affect the NBTC’s plan to claim damages from Jas Mobile.

If the NBTC does not hold the new auction, it would have no auction costs or related costs to refer to in order to claim damages from Jas. If the auction is held and the final price is lower than Jas’ bid, the watchdog might be able to claim this price difference from Jas.

It is highly likely that there will be only three bidders – Advanced Info Service, Total Access Communication, and True Corp. However DTAC said that if the starting bid price for this new round were Bt75 billion, it probably would not participate.

DTAC is opposed to the telecom committee’s resolution to allow TrueMove H Universal Communication, which won the other 900MHz slot in December, to take part in this new bidding.

AIS is interested in joining the new auction but the final decision on that rests with its board. True is keeping mum on whether it will enter the fray.

The telecom committee has set up a working group to draft the new auction rules for the possible starting licence price of Bt75.654 billion. The auction is expected to take place on June 24.

The NBTC earlier resolved to hold a new auction for Jas’s 900MHz band with a starting price of Bt75.65 billion.

The other 900MHz licence winner, True Move H Universal Communication (TUC), may take part in the re-auction. If there is no interest in the band, the NBTC will keep it for at least one year.

A source from AIS said the telecom giant was keen to take part in the re-auction but it had to consider the terms and conditions of the auction first.

Lars Norling, chief executive of Total Access Communication (DTAC), said that this was an unfortunate and unprecedented situation that called for a well-thought-out and fair solution for all involved parties.

If a re-auction must take place, it’s DTAC view that there should be a new auction of this Jas 900MHz-band based on the original criteria and reserve price of Bt16.080 billion (this applies if there are fewer than three bidders) set by the NBTC. Only then can the true value of the spectrum be determined, he said.

Jas Mobile Broadband (JASMBB) of Jasmine International, one of the two 900MHz licence winners, yesterday did not show up to pay the instalment after the deadline yesterday at 4.30pm.

Its failure to pay the instalment suggested that there is no new player in the market to compete with the three incumbent players.

Jas’s share price yesterday closed at Bt3.68, up 2.79 per cent from last Friday, while that of Advanced Info Service (AIS) closed at Bt177, up 3.51 per cent.

DTAC’s share price closed at Bt42.25, up 5.62 per cent, and True Corp closed at Bt8, up 1.91 per cent.

A Jas source said the company had tried its best to fulfil the payment conditions but declined to elaborate.

The telecom committee acknowledged the Jas case yesterday and will convene tomorrow on how to proceed next, including confiscating Jas’s cashier cheque of Bt644 million placed before the auction, and to evaluate the possible damages from the case.

“In this Jas case, we consider it a sensitive issue that we have to consider in all aspects, including the legal one and the country’s interest. We’ll consider more details on Wednesday,” telecom committee chairman Settapong Malisuwan said yesterday.

It is too soon to specify the damage from the case, Settapong added. He added that the committee has done its best in this case.

After tomorrow’s meeting, the committee will also present the conclusion to its legal subcommittee to consider what to proceed next.

NBTC secretary-general Takorn Tantasith yesterday said the watchdog might hold the re-auction in four months.

The committee has also informed Prime Minister General Prayut Chan-o-cha on the Jas case.

Takorn added that besides the option of the re-auction, another option is that the NBTC will propose to the junta that AIS, which proposed the second-highest price among four bidders, would be called to ask if the company is interested in buying this licence for Bt75.65 billion. If not, the watchdog will make the same proposal to DTAC.

Takorn said the NBTC had to consult with the junta on this second option.

The NBTC held the auction of two lots of 900MHz licences last December. AIS competed for the second spectrum lot by bidding Bt75.976 billion but was outbid by True Corp, which offered Bt76.298 billion.

As the auction ended, DTAC competed with JASMBB for the first spectrum lot by bidding Bt70.180 billion but it lost the bid to JASMBB.