Thai shares stumbled 1.38 per cent in reaction to the Constitution Court acceptance yesterday of a petition to consider an investigation into Prime Minister Thaksin Shinawatra’s business dealings after his family and a related clan sold their combined 49.6-per-cent stake in Shin Corp Plc to Temasek Holdings.

And a later announcement of plans for non-stop anti-Thaksin rallies, which will start from February 26, didn’t help sentiments.

The composite SET index yesterday started the day with a sharp fall and headed south further to the day’s trough of 723.75 points before rebounding slightly to close at 727.91 points. Turnover was moderate at Bt18.12 billion.

An analyst at a foreign brokerage said that foreign investors were keeping themselves at bay yesterday.

“They are concerned about political issues, particularly after the senators asked the Constitution Court to [probe Thaksin’s business dealings]. If the court on Thursday [launches an investigation], the stock market will continue in

the doldrums,” the analyst said.

 The petition filed by 28 senators alleged that Thaksin violated the Constitution with his involvement in corporate management while in office, which would constitute a conflict of interest.

“There are growing uncertainties about the political situation. Foreign investors are avoiding investments because they don’t know how the issue will end,” the analyst said.

If Thaksin decides to dissolve Parliament, he may return to lead the government but his control will be in decline and government policy could not proceed as smoothly as it had in the past, the analyst said.

By waiting until Thursday to decide whether to launch a probe the court is prolonging market jitters, said Tarisa Chaisuntornyothin, senior vice president of Siam City Securities.

The sale of Thaksin’s family’s stake in Shin has sparked strong criticism, particularly over the involvement of British Virgin Islands-based Ample Rich Investments Co Ltd which Thaksin created in 1999 to funnel some of his Shin Corp holdings into.

Finance Minister Thanong Bidaya said yesterday that the Securities and Exchange Commission (SEC) had already obtained all documents related to Ample Rich but they need to be certified by the authorities of the British Virgin Islands.

Thanong, also chairman of the SEC, said that there were no problems despite the many allegations that Ample Rich, as a nominee of the Shinawatra family, was used to conduct murky business including money laundering, tax evasion and stock manipulation. The SEC had been waiting for nearly two weeks for the documents from Thaksin’s children, Panthongtae and Pinthongta, who are Ample Rich’s shareholders.

The identity of the company has been in the public eye. The Democrat Party has asked the Commerce Ministry to find out the true identity of the company. Orajit Singkalavanich, director-general of the Business Development Department, said the department’s investigative powers were limited only to entities registered in Thailand.

Yesterday, Thanong insisted there was no second Ample Rich Investment as the Democrat MPs have alleged. Nor were shares of Shin transferred back and forth between Ample Rich and the other company.

“There is no serious issue. It is explicable,” said Thanong. Asked whether the Revenue Department reported to him about the tax issue posted by the Democrats, Thanong said the department did not need to consult him.

The Democrats last week asked the Revenue Department to collect about Bt3 billion in taxes from Thaksin’s children’s income because they bought shares at a prices far below market prices from Ample Rich.

Democrat Party Leader Abhisit Vejjajiva was quoted by The Straits Times as saying the SEC might call on Temasek to answer its questions.

“I don’t think there is anything special about Singapore that leads to opposition,” the Democrat Party chief said in an interview yesterday during a visit to Singapore. “But the question that is being asked is whether foreign ownership is still really in the minority as stipulated in the law. This is what is not clear and this is what leads to opposition.”

Siriporn Chanjindamanee,

Wichit Chaitrong

The Nation