The 2006 sale of the Shinawatra family's share of Shin Corporation to Temasek Holdings caused great controversy in Thailand. The sale was in response to long-standing criticisms that the Shinawatra family's holdings created a conflict of interest for Thai Prime Minister Thaksin Shinawatra. Criticisms of the sale focused on the allegations by Thaksin and a compliant government that the transaction was exempt from capital gains tax (as per Revenue Department and Stock Exchange of Thailand regulations - later determined by Thai courts not to be legal), the fact that the Thai company was sold to a Singaporean company, and the fact that the Thai law regarding foreign investments in the telecom sector had been amended just prior to the sale (although the amendment had been proposed since 2001). Thaksin's sale also impacted holdings, among other parties, of the Crown Property Bureau that has investment in the Siam Commercial Bank that held ShinCorp stock.
The sale of Shin Corporation to Temasek Holdings
On 23 January 2006, the Thai Telecommunication Act became effective, raising the limit on foreign holdings in telecom companies to 49%. The Act replaced the Telecom Business Law, which took effect in November 2001, and put the foreign investment cap at 25%. At the time, AIS was the only company that actually complied with this provision. Competitors DTAC and TA Orange were 40% owned by Norway’s Telenor and 49%-owned by France's Orange. Although the law was not... Read More