On November 17, 2006 TrueMove notified CAT and TOT informing them that it would cease paying access charges on the basis that the rate and collection of access charges under the agreement were contrary to the law. TrueMove also asked TOT to enter an IC agreement in compliance with the law, or to temporarily apply the provisional rate announced by the NTC, while negotiations on an agreement with TOT proceeded. As a result of the cessation of access charge payments by TrueMove, on November 23, 2006, TOT issued a letter stating that TrueMove was not entitled to connect its network with TOT’s because it was not a telecommunications licensee, as granted by the NTC, and did not have its own telecommunications network. TOT also disputed that the AC agreement violated any law and that the rate and collection of access charge under the Access Charge Agreement continued to apply. However, TrueMove considers that TOT’s claim is not in line with the Telecommunication Act B.E. 2544. In addition, TOT has threatened not to integrate TrueMove’s 1.5 million new phone numbers, allocated by the NTC to its system, meaning that TOT subscribers would not be able to call TrueMove subscribers with those 1.5 million phone numbers. TrueMove filed a lawsuit with the Central Administrative Court requesting an injunction and on January 26, 2007 the Court granted an injunction ordering TOT to include new TrueMove numbers and data translation on its network so that subscribers of TOT and TrueMove could communicate with each other. This was in line with the NTC’s regulation and public interest. On January 30, 2007, TOT appealed the injunction to the Supreme Administrative Court, which later confirmed the Central Administrative Court’s ruling. However, since March 2, 2007, TOT was forced to make a permanent connection to new TrueMove numbers following the Administrative Court injunction. On February 26, 2009 the Central Administrative Court finally ruled that TOT must make the connection permanent and compensate TrueMove Baht 1,000,000 as claimed. TOT subsequently appealed this decision to the Supreme Administrative Court with the final verdict still pending as of the time of writing. In addition, on October 9, 2009, the Central Administrative Court ruled against TOT in its dispute with the NTC who ordered TOT to allow 1.5 million new DTAC and TrueMove numbers to connect to its network. TOT also appealed this case to the upper court. On March 2, 2010, TrueMove submitted information to the Supreme Administrative Court to support the NTC’s order. Therefore, the rulings on the two cases as mentioned herein are still not final. In June 2007, TrueMove brought the said issue to the NTC’s Dispute Resolution Committee. On November 28, 2007 the NTC issued its final decision, confirming that TrueMove has the same rights, duties and responsibilities in relation to the interconnection regime as the licensee (who has been granted the NTC’s license). The NTC unanimously ordered TOT to negotiate with TrueMove on the IC agreement. On June 23, 2008 TOT agreed to negotiate with TrueMove concerning IC on the condition that the agreement will only cover new numbers issued by the NTC. TrueMove agreed with this proposal but negotiations have yet to be concluded. With regards to the old numbers, TrueMove is still in dispute and is awaiting the court ruling. On November 16, 2007 TOT filed a lawsuit against TrueMove with the Civil Court, claiming violation of the AC Agreement and requesting access charge payments of Baht 4,508.1 million with related interest and valueadded tax. On September 16, 2009, it was ruled that the case was not under Civil Court jurisdiction and thus dismissed from the Civil Court. Therefore at the time of writing the case is not yet final. If we are not successful in resolving this issue in our favor, in addition to a penalty equal to 100 percent of any access charges CAT may have paid to TOT on our account and interest thereon, we may be required to pay both new interconnection charges as well as existing access charges, which will result in a material increase in our costs. If a final court order requires TrueMove to pay access charges it would record additional expense and be liable to accrue additional access charges of Baht 9,144.1 million (or Baht 6,827.3 million, net of revenue sharing paid to CAT) for the period from November 18, 2006 to December 31, 2008; Baht 5,447.7 million (or Baht 4,071.7 million, net of revenue sharing to CAT) for the year ended December 31, 2009 (see details in Note 42.2 to the Consolidated and Company Financial Statements for the year ended 31 December, 2009).
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