New airport duty free bid split into two

The Government has insisted that the AoT rejig its awarding for the concession of duty-free shops at its airports. Up to now King Power Duty Free has had a monopoly on the lucrative duty free concessions.

So the Board of the Airports of Thailand Company has now decided to split the concession to operate airport duty-free shops into two contracts – one for Suvarnabhumi (BKK) and the other for Phuket, Chiang Mai and Hat Yai international airports.

The AoT board is also stipulating that the products being sold at the duty-free shops at all of its airports must be of good quality, competitively priced and the financial returns for the AoT from the two contracts must be no less than those it receives under the current single operator concession.

Initially the AOT wanted to retain the one-contract bidding format, but came under heavy criticism from several other retail giants who are eyeing a share of the lucrative duty-free business and have lobbied the Government for a change to the awarding of the concession.

The concession has been monopolised by King Power International Group, whose concession expires next year.

Mr. Mana Nimitmongkol, secretary-general of the Anti-Corruption Organisation of Thailand, said that previously the AoT acted alone in awarding the concession, without holding any public hearings to hear the views of other stakeholders.

He suggested the AoT should adopt good corporate governance practices, similar to those used in the award of the Blue Line train project, to ensure transparency and allay fears of the other retail organisations who demanded a fair bidding process.