AoT won’t scrap King Power contract

Agency president not axed, Wissanu insists

The Airports of Thailand (AoT) has insisted it will not scrap its existing contract with King Power Group, the country’s largest duty-free operator.

AoT president Nitinai Sirisamatthakarn made the remarks in response to reports that he might be removed from office if he did not terminate the contract.

He said that the proposal to end the contract with King Power was made by a National Reform Steering Assembly (NRSA) committee at a meeting on April 25, chaired by Deputy Prime Minister Wissanu Krea-ngam.

Present at the meeting were representatives from the Office of the AuditorGeneral, the Customs Department, the Revenue Department, the AoT and the Transport Ministry, the NRSA committee and the Public Sector Anti-Corruption Commission.

Mr Wissanu met the agencies to discuss matters relating to duty-free pick-up counters at airports after the State Audit Commission asked the AoT to explain its plan to allow other private operators, including South Korea’s Lotte Duty Free, to rent space at Suvarnabhumi airport for commercial purposes.

The AoT was required to give a reply within 60 days or by the end of this month.

At the meeting, the NRSA came up with five proposals including dismissing the AoT president and AoT board and revoking the contract with King Power, Mr Nitinai said.

However, the meeting did not reach any conclusion on the matter as Mr Wissanu only wanted to listen to opinions from those present, Mr Nitinai said.

He insisted that AoT has to stand by the existing contract with King Power, and said the termination of the contract was only a proposal raised by the NRSA committee.

As the contract is still in effect, any companies that want to use space at Suvarnabhumi have to contact King Power, Mr Nitinai said.

He added that AoT is preparing to call a bid late this year to choose a new operator to manage commercial space and dutyfree shops at Suvarnabhumi before the contract with King Power expires in 2020.

King Power is the sole concessionaire at the city’s major two airports — Suvarnabhumi and Don Mueang.

King Power’s contract for Suvarnabhumi is scheduled to expire on Sept 27, 2020 while the contract for Don Mueang airport will run out on Sept 30, 2022.

AoT is also estimating if the value of the new investment will be more than one billion baht, which would mean it would have to undergo the processes involved in the 2013 Act on Private Investments in State Undertakings.

A new concessionaire will be picked to manage the airport’s passenger terminal space covering about 20,000 square metres, as well as the new 10,000-square-metre satellite terminal which is expected to be completed in 2019 and to be opened in 2020, Mr Nitinai said.

Under the new contract, the new concessionaire will also be required to allow other duty-free companies to share the space and it will be left to the concessionaire and other other pick-up counter operators to decide on how to manage their space, Mr Nitinai said.

Meanwhile, Mr Wissanu brushed aside reports that the AoT president would be removed from office at the suggestion of the NRSA committee on anti-corruption.

Mr Wissanu said Prime Minister Prayut Chan-o-cha had assigned him to look into the matter. He then called the meeting and reported the outcome to the premier. Mr Wissanu insisted no one had been dismissed.