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13 April 2002

Pantip Crackdown Eases

Observer reports indicate that the trade in pirated software at Thailand's notorious Pantip Plaza is getting back to pre-crackdown levels as of Early April. Previously, Pantip was the subject of a major crackdown that some believed heralded the end of an era for the pirate market extravaganza at Pantip.

Current market rates for pirated CD's are VCD, 180 baht for an MP3 foreign music CD, and 250 baht for a movie on DVD. CD's and DVD's are normally stored in an outside location and delivered after the purchase.

In February, a crackdown programme on piracy was launched in a conjunction with various intellectual property right representatives and recording firms.

Other malls subject to the crackdown and on the hit list are Mahboonkrong shopping centre, IT Mall, Khlong Thom and Saphan Lek markets.


22 March 2002

Tightening of Food Import Regulations

Commerce Minister has declared his intentions to impose further health assurances on food imports pursuant to a recent cabinet discussion occurring March 2002. Spokesperson form the Ministry declared that the tightening of restrictions was not in retaliation for the European Union's increased scrutiny of food imports from Thailand.

Recently EU authorities increased its scrutiny of Thailand poultry and shrimps citing concerns over food additives. Thailand is a major supplier of food products to the EU and Thailand imports up to 72,000 tons of skimmed milk form the EU. The EU now bans the use of various chemicals in their food imports, the majority of these chemicals being antibiotics, some of which have been linked to cancer.


14 March 2002

Revenue Department To Audit Loss Reports in Companies

Companies which have reported losses over two years but have declined to claim an entitled exemption will be audited according to Revenue Department officials.

Some of these companies may be suspected of manipulating its accounts to avoid taxes.

The fact that a company reported losses but elected not to claim an entitled exemption may be attributed to wanting to avoid the scrutiny that a claimed exemption would normally entail.

Previously, a decision by a company not to elect a claimed refund would not alert the tax officials because such an exemption would generally only benefit the taxpayer. However, with Thailand experience its sixth year of budget deficits, new methods and tighter controls are being introduced.

In contradistinction to the hard-line presented in the call for audits, the Tax Department is taking other measures to improve the positive perception of the tax department including attempting to accelerate the Value Added Tax refund process.


13 March 2002

TAMC Progress Stalled by Disputes

Failure to meet stated objectives this month, the Thai Asset Management Corporation (TAMC) has blamed disagreements with creditor banks and the restructuring framework itself as the principle cause for the delay. Delays in establishing a restructuring procedure between multi-creditor loans were cited as the principle cause for the disagreements leading to the delays.

Despite the current situation, the TAMC has expressed confidence that the TAMC will ultimately meets its long-term objectives

According to spokespersons at the TAMC, the agency had, as of 11 March 2002, restructured 50.13 billion baht in debt, an increase of 6.9 billion from the end of January. Its previously announced goals however were to restructure 100 billion bath in loans by the end of the first quarter. Causes loans by the end of the first quarter.

Since October of 2001, the TAMC has accomplished the transfers of 698.4 billion bath in non-performing loans from private and state banks.

Restructured loans have been handled by settlement through cash payments in 14 % of the cases, 13% by collateral transfers, and 25% by extending payment terms, 10% by debt to equity swaps and 29% involved "haircuts", 2% involved liquidations.

A framework for dealing with the multi-creditor loans is expected to be established within the second quarter and spokesperson have announced that they are committed to restructuring over 500 billion bath worth of assets.

The TAMC was created last year with the intent of bypassing lengthy bankruptcy procedures and get creditors and borrowers at the bargaining quickly.


6 March 2002

Bankruptcy Reform

The Cabinet approved a series of reforms to the Bankruptcy Act. Changes include a reduced fees to be paid for bankruptcy and debt restructuring case administrators. The new "cap" on these professional fees will be 3 % down of the assets value down from the former amount of 5 %. This measure is intended to increase returns to creditors. In those cases where assets have been seized but have not yet been sold, fees will be reduced to 2%


3 March 2002

Leases for Foreigners May Be Extended

A draft amendment that would allow foreigners to lease commercial and industrial real property for an extended time is before the Cabinet this week. The bill would enlarge the time for which foreigners may lease land. Currently Land Department regulations state that the maximum lease for commercial and industrial property by foreigners is 50 years. The bill would propose a longer period of up to 100 years and grant certain overseeing duties to the Land Department. Implementation of the proposed law would also be subject to Land Department regulations.

Although the current law limits leases on commercial and industrial property to 50 years, a right to renewal of up to 50 years is allowed, Minimal investment of 20 million baht is required for plots of land smaller than 10 rai. A100 million baht investment is required for plots of land larger than 100 rai. All project sties to such land leases must be officially approved.

Battle Against Piracy

Ministry of Commerce spearheaded its new anti-piracy campaign by hosting a ceremony at Pantip Plaza, a local mall well known for its computer products. Subsequent to the ceremony police raided a warehouse and machinery alleged to be used in counterfeiting operations was seized.

Stall owners at the Mall have agreed to seize from selling pirated articles of software and it is widely believed that the wild west days of Pantip Plaza are fading into the sunset. The mall owner has reportedly signed an agreement with software producers to market legitimate software in Pantip.

Thailand has come under increasing pressure from its international trading partners to crack down on the trade in counterfeited software.


28 February 2002

Ministry Announces Amended Garment Act

The Commerce Ministry announced that it had submitted draft of the New Garment Act to the Minister and that the new may be approved within a month. The new Act will prohibit the transfer of export quotas, which, it is hoped will exclude brokers of quotas from the market and place quotas in the hands of real exporters. If the exporter cannot meet the quota requirements the remaining quota would be returned to the department for redistribution.


1 February 2002

Property Fund Rules Relaxed

In order to promote investment the Finance Ministry has proposed changes to the laws regulating property funds. Proposals include the removal of the maximum limit on individual investors previously set at 10%. However the limitation on related parties and property owners holding no more than 33% will remain.

Property funds will also be permitted to invest in non completed projects provide that they are 80% completed. Property assessment, which under the old rules was required every six months, will be required only once a year. Voting procedures were also amended so that a majority vote will require 75% of the fund holders attending the meeting.


29 January 2002

New Plans for Good Corporate Governance

The Commerce Minister announced new plans for enforcing a new era of good corporate governance. Among the changes proposed was a broadening of the powers of the Securities and Exchange Commission to enforce company regulations.

The moves are aimed at improving investor confidence and strengthening the tax base.

The Commerce Ministry revealed statistics that out of 580,000 registered firms, half have not filed balance sheets or tax records and only 120,000 of these companies reported any tax payments.


15 January 2002

Thailand-US Double Taxation Treaty Extended

The Thailand-US Double Taxation Treaty contains a provisions that requires a diplomatic note concerning the exchange of information between the principals. Pursuant to said provision, the Thai government has issued a note signed by the Prime Minister. Without the issuance of said diplomatic note the Treaty would expire in 2003.

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