EARTH Thailand

IEAT seeks legal advice: Extent of Map Ta Phut curbs unclear

Bangkok Post 03 October 2009

The government agency in charge of the Map Ta Phut industrial area hopes to obtain a legal interpretation within the next week of a court ruling that has halted 76 industrial projects at the complex in Rayong province.

The Industrial Estate Authority of Thailand (IEAT) will seek advice from the Office of the Attorney General on whether industries at the estate in fact need to halt construction, said Monta Pranootnarapal, the IEAT governor.

"We need an interpretation ... if 60 ongoing projects under our authority can go on or need to stop everything right away," Mrs Monta said yesterday.

Prime Minister Abhisit Vejjajiva has asked the Industry Ministry to file an appeal to the Supreme Administrative Court of Tuesday's ruling.

The Administrative Court ruling suspended operating permits for 76 projects, based on Section 67 of the 2007 Constitution, which addresses the impact of industries on communities. Section 67 calls for an independent body to approve all projects' environment impact assessment (EIA) and health impact assessment (HIA) reports, but that body has not been formed yet.

The government and private sector have expressed concern about the severe damage delays could cause to project operators, and to the investment climate.

The court ruling would also affect IEAT's revenue, especially utilities income, and less income means less government revenue, Mrs Montha said. As a result, she added, the agency would have to tighten spending.

The Joint Standing Committee on Commerce, Industry and Banking (JSCIB) met yesterday with representatives of six affected industries: petrochemicals, oil refining, chemicals, power producers, plastic and steel industries.

Santi Vilassakdanont, the chairman of the Federation of Thai Industries (FTI), said participants planned to go ahead with an appeal. It would be based on the contention that the affected projects were not included in a list of eight harmful industries prepared by the Industry Ministry.

As well, he said, they would ask for a court order easing the terms of the ruling, given the high economic losses.

Mr Santi said up to 100,000 people faced unemployment and companies would face heavy compensation costs.

As well, he said, the financial status of some companies could be questioned by creditors at a time when the poor economy has made lenders cautious.

Finally, projects that have orders in hand could face compensation costs if they cannot deliver goods under the contracts, with some are worried about their inventories of materials for producing goods.

Payungsak Chartsutipol, an FTI deputy chairman, said foreign chambers of commerce had started to express their concern over the impact of the ruling on investment sentiment.

"Japanese and United States [business leaders] have sent official inquiries as they have started to worry over the impact it will have on the national investment environment. The incident increases the risk of doing business in Thailand and we want this deadlock to be over as soon as possible," Mr Payungsak said.

Nandor von der Luehe, chairman of the Joint Foreign Chambers of Commerce of Thailand (JFCCT), said that while members respected the law and supported environment conservation, investors also needed a level of fairness, predictability, defined rules of law and consistency in setting up and operating businesses in Thailand.

"At the same time we have to realise that Thai as much as foreign investors consider the ruling an obstacle to investment," he said. "We are particularly concerned that it might lead to projects not being able to make their contractual committed commercial operations date or that project financing might be withdrawn due to the uncertainties. We hope and support that the government is appealing the ruling and that a satisfactory solution can be found."