Govt misses an opportunity by stumbling over retail-business law

On Tuesday, Prime Minister Surayud Chulanont sprang a surprise by pouring cold water on the first draft legislation covering retail business.

Commerce Minister Krirk-krai Jirapaet had been trying to get Cabinet endorsement for the law that would regulate retail selling.

There is no existing law. Retail is a free-for-all. Giants - Tesco Lotus in particular - have expanded throughout the country without any restraint from local government and agencies.

Small retailers are crying foul, claiming that without restrictions to curb expansion of the giantsthey will be wiped out.

The proposed legislation restrains the building of vast, modern retail outlets, both locally-owned like the Central Group or foreign-owned such as Tesco Lotus. They will be subject to rules and regulations. Most countries have similar laws.

The legislation includes zoning regulations, specifying in which areas retail outlets can be located.

Now, the giant retailers have a stronghold in major cities and are about to penetrate districts and communities.

Street vendors will be affected. A local leader in Nakhon Ratchasima, who has been protesting against the giants, said some six million people would be badly affected by runaway mega-retailer expansion.

The legislation would give regulatory power to national and local commissioners.

The stakes are high. The retail sector is worth about Bt1 trillion a year out of a total economy of Bt7 trillion.

Joining the prime minister in opposing the legislation are Industry Minister Kosit Panpiemras, Finance Minister Chalongphob Sussangkarn and Science and Technology Minister Yongyuth Yuthavong. They claim the legislation gives too much power to commissioners.

They also say it fails to spell out retailing and wholesaling so that small and big operators can co-exist.

The Cabinet wants the Commerce Ministry to conduct a public hearing before resubmitting it.

Krirk-krai's draft legislation might not be perfect but the Surayud Cabinet should have worked with the Commerce Ministry first to make sure that it would be acceptable to all parties.

By doing so, the draft legislation would get Cabinet endorsement.

Strangely enough, there was no signal at all that the Cabinet would shoot down the draft. Krirk-krai appeared confident of support.

Now it looks as if the legislation might be delayed and nobody is certain if it would be passed during the term of this government.

Yet again the Surayud Cabinet has failed to make a tough decision. Had the Cabinet passed the law, it would have been able to send it to the Council of State for legal scrutiny and then finally push it to the National Legislative Assembly.

Any weakness or flaws in the draft can be corrected in the National Legislative Assembly.

Thailand urgently needs a retail business law.

From : the nation
By : pla
Date : Mar 29, 2007

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