Ericsson of Sweden has accused TOT Plc of being unfair and non-transparent in the bidding process for its nationwide third-generation (3G) wireless broadband expansion worth nearly 20 billion baht.
The company's Stockholm headquarters warned the issue could tarnish Thailand's image by portraying it as a country lacking in transparency and fairness.
China's ZTE Corporation also plans to petition Prime Minister Abhisit Vejjajiva and says it will "fight to the end" if it does not receive fair treatment from the state telecom enterprise.
The state-owned Chinese enterprise guaranteed it could shave 5 billion baht off the price of the 3G project if it won the bidding.
The companies were responding after TOT made a preliminary announcement that the two contenders had both been tentatively ruled out through a preliminary screening process.
Ericsson was supposedly disqualified for the absence of catalogues for antenna-related products in its submitted bid. TOT is also reportedly concerned that if any legal disputes arose, it would have to rely on a Swedish court and not the Thai legal system.
ZTE, meanwhile, was supposedly disqualified for providing "unrealistic financial calculations".
Four groups submitted bids last week for building the nationwide 3G network for TOT - the SL consortium of Samart Corporation and Loxley Plc, with Huawei Technology supplying the network and equipment; the AU consortium of Advanced Information Technology and United Communications; the Ericsson-A.S. Associate Engineering (1964) consortium; and the ZTE consortium of ZTE and Forth Corporation.
TOT initially planned a formal announcement naming the qualified bidders tomorrow.
An e-auction is scheduled for Jan 28, and TOT hopes to sign a contract with the winner sometime between Feb 15 and 18.
"[The missing catalogue] is simply a minor issue based on the fact that we submitted more than 100,000 pages of documents for this project. It should not be a major reason for disqualification," said Joacim Damgard, the president and country manager of Ericsson (Thailand).
Ericsson's consortium is preparing to submit a letter to TOT and the Information and Communications Technology Ministry regarding the matter.
Mr Damgard said no issues regarding the catalogues' absence were raised during a meeting with TOT representatives last Friday.
"We think the results will limit TOT's opportunity to ensure a competitive auction in the next stage for the best commercial and technical solution," he said.
The company does not plan to take legal action against TOT but will oppose the process via relevant channels, said Mr Damgard. "Our headquarters in Sweden and regional office will allow us to handle this alone," he said.
Mr Damgard added that the project would be the biggest one this year for Ericsson (Thailand).
It comprises three parts: 17.44 billion baht for procurement of network equipment, 540 million as a reserve and two billion to upgrade TOT's 3G network in Bangkok.
Pongchai Sirinarumitr, the vice-president for government accounts at Ericsson (Thailand), confirmed the Stockholm headquarters had said the issue could harm Thailand's image.
Ericsson said it would seek clarification from TOT within three days as per its bidder rights in objecting to the results.
Pongchai Amatanont, the managing director of Forth Corporation, acknowledged that disqualification rumours had been circulating in recent days.
However, he said his company asked TOT for a clear explanation yesterday, and the state enterprise said no formal announcement has yet been made for the preliminary results and that a clear result will be known this week.
An industry source said that if only two bidders are allowed to participate, collusion would inevitably occur, with TOT likely to pay 4-5 billion baht more for equipment purchases.
The source also suggested Samart could be disqualified based on the fact that the communications equipment firm is considered a competitor to TOT since it is providing 3G services as a mobile virtual network operator on behalf of the state enterprise. Samart also competes with TOT in producing packet switching equipment.