Subway Depot Development Controversy 2000-2004

What happened to the subway depot development plans?
2Bangkok.com has the only English-language mention of the attempts to develop expropriated MRTA land for commercial use. It was extensively covered in the Thai-language press.

This issue first came up in 2001 when MRTA (the subway company), attempted to develop some of the land they expropriated to be a shopping center and residents complained that this would be prohibited by the Constitution. The constitutional ban is based on the earlier scandal involving the Central Lat Prao site (See Was Central Lat Prao really built on a garbage dump?).

From the articles below it seems the focus turned to lobbying the government to change the zoning first, but them MRTA would still have had to confront former owners to settle the issue (perhaps by giving them more compensation).

MRTA land development folded - translated and summarized from Prachachart Thurakij - March 4-7, 2004
MRTA decided to fold the plan for commercial development of MRTA Huay Kwang depot since it has to expand the maintenance facilities to carry the extended Blue Ring, the upcoming Orange line and future Purple line which will gobble most space available in MRTA land. This will need 300 rai for the current Blue Ring, 300 rai for upcoming Orange line and another 300 Rai for the Purple line--with only 100 Rai left for commercial development.
Therefore, MRTA has to beg the government for the budget to pay off debts until MRTA has gotten the revenue from the passengers, the nationalization, and the private space leasing from 18 stations as well as from future stations. Park and Ride facilities at Ratchada-Ladphrao and Brew pavilion are another source of income--though not much since MRTA collects a very small fee for parking tickets.

MRTA Development Plan Folded - BMA refuses readjust zoning - translated and summarized from Prachachart Thurakij, August 21-24, 2003
BMA and City Planning Dept. refused to readjust the color of the 691-rai MRTA Depot and Maintenance Area from Blue (Bureaucrat Office) to Red (Commercial Area) even though MRTA has tried to lobby hard to make such a change. BMA warned MRTA that if BMA changes the color from blue to red, MRTA must confront the former landowners who had surrendered their land plots for the depot.
Many people said the reason why BMA refused to fulfill the request from MRTA is due to MRTA's strong connection with CH. Karnchang. Therefore, Premier Thaksin might have ordered BMA not to change the color of the area to allow commercial development to starve Ch. Karnchang and force a merger with the Skytrain.
Even if those who surrendered their land to MRTA agree to allow commercial development on MRTA land, the development might not be worthy as they expected since SRT is going to develop the land around Makkasan Station with government support [as an airport rail depot]. By the time the MRTA plan would be approved, their might be no demand at the MRTA depot location. Therefore, MRTA could only be allowed to construct a park and stadium since they are considered a public good. Another usage might be a new SRT depot.

Senators Aiming to Kill the "Subway Business Center" Plan
Siam Turakij, May 27-June 2, 2001

A senator insists the MRTA land development plan on 700 rai has gone too far
Senator Seri Suwanphanon insists that MRTA cannot exploit the public utlity land for commercial gain since it violates the expropriation law in the Constitution. Senator Seri is preparing to ask the Senate to set up a committee to investigate the MRTA land deal and ask the cabinet why the government let MRTA make a commercial exploitation. Pheeraphong Saleeratthawiphak (Democrat MP from Phayathai Constituency) who was on of the Transportation Committee in the previous administration stated that the MRTA Act they passed had a provision allowing small shops and restaurants to facilitate subway passengers, not the big business area MRTA plans. If the Thaksin government allows MRTA to exploit the land, the government will be stamped as "Bandits Robbing People!" MRTA decided not to reveal the land development plan to the MRTA committee since they felt the heat from the opposition even though they claimed that final plan is not settled. According to the land development plan drafted by RMJM (Thailand), CB Richard Ellis (Thailand), and PB Asia consultant companies, MRTA needs to invite the private sector to invest in the land so that it will meet the schedule of August 12, 2003 (the day the subway system is starting). Even though MRTA was planning to put the draft on land development to the MRTA Board on May 23, 2001, there was actually no plan discussion during the meeting at that day. The meeting was held at the Emerald Hotel with Dr. Suphachai Phisitwanit as the chair instead of the MRTA HQ. The meeting lasted from 11:00 AM to 12:30 PM. After that, they had lunch in the Chinese restaurant.

Meeting results
The results from this meeting showed that the latest progress is 2% off the target, and there was a new subcommittee to make an internal audit headed by Mr. Thoedsak Setthamanop (MRTA Engineering Director). However, the land development plan was not on the agenda even though the MRTA Director was planning to push the plan on this meeting. After the meeting, MRTA Director told Siam Turakij correspondents that this meeting was a welcome meeting for the new MRTA Board, so they decided to change the meeting place and hold a banquet for the new committee. The reason why the MRTA director decided not bring up the land plan during the meeting was that MRTA and the consultant companies need to revise the land allocation according to the discussion with the Huay Kwang Civic Society two weeks ago. As soon as the revision is done, the land development plan will be brought up in an MRTA meeting in the future. However, an MRTA source has told Siam Turakij that MRTA committee has felt heat from the opposition, especially from the mass media and lawyers which saw that MRTA was going to commit crimes against the former landowners and violate the Constitution. Therefore, MRTA decided to suspend the land development plan for a while until everything is fine.

Seri Suwannabhanon (Bangkok Senator) Insists that MRTA Act Has No Right to Commercialize the MRTA Land
Senator Seri Suwannabhanon (Bangkok Senator and a Legal Expert) has continuously insisted that MRTA has no right to make commercial development of land expropriated from the people. He also told Siam Turakij correspondents that there must be some irregularities in the law approval process before MRTA Act became a reality on November 24, 2000 since the Act has so many sections and the sections relating to the land development are separated, so the Senate cannot figure out the actual intention of the law that allows commercial development on MRTA land even though there was nothing that mentioned about the land development in the previous Law relating to the MRTA land. Even though the MRTA Act has empowered MRTA to make a commercial development on their land, it does not allow MRTA to exploit the land for profit on their whim since the MRTA Act states that MRTA could make commercial development for service facilitation (in and around stations for passengers). The senator said "There are controversies about the actual meaning of the phrase 'According to the Necessaries that benefit MRTA services.' I can see no difficulties in defining such a term at all since it requires narrow interpretation on the terms to get the exact meaning. MRTA has no right at all to make a broad interpretation of the law (to allow the construction of a shopping center, hotels, markets, or so) for commercial gain since it violates the principals of this Act."

Revealing that MRTA Violates Royal Proclamation on Land Expropriation and the Constitution
Senator Seri also said that MRTA was violating the Royal Proclamation of the land expropriation if MRTA insists that they have full rights to make commercial development on the land they obtain through the expropriation since the land expropriation principles have explicitly stated that MRTA has the right to expropriate the land ONLY for the mass transit system. Furthermore, the 48th Article of the 1997 People's Constitution said persons have full rights to protect and preserve personal properties and the 49th Article in the 1997 People's Constitution also explicitly states that No Government Office has rights to expropriate land except for public utilities. Any attempt to make commercial development on the MRTA land expropriated from the local people is considered violating the 48th and the 49th Articles in the Constitution since MRTA has abused the rights stated in MRTA Act to "rob and violate" the land form the people for commercial gain.

Preparing to Tell the Senate to Set up an Investigation Committee and Ask the Government about the MRTA Land Development
Senator Seri said after perusing the commercial land deal of MRTA from the consultant companies, he slammed the conclusion that "MRTA is telling a lie and committing crimes against the former landowners since the MRTA land development plan has explicitly shown that MRTA is going to exploit their land expropriated from the local people for profits even though those folks were willing to receive cheap compensation and sacrifice for the public good. Such action committed by MRTA is totally unacceptable." "If MRTA is starting the land development project, I (Senator Seri) will send the proposal to the Senate to set up the investigation committee to deal with MRTA and deliver the questions to the Cabinet to check if such action from MRTA is appropriate or otherwise. The government has to take the responsibility to deal with the former landowners, and I (Senator Seri) will volunteer to get the land back from MRTA."

Former Transportation Committee Member States that MRTA Has No Right to Make a Commercial Deal on Expropriated Land
MAP Pheeraphongse Saleeratthawiphak (Democrat MP of Bangkok -> Phayathai Constituency), one of the former Transportation Committee which had reviewed the MRTA Act before approval told Siam Turakij correspondents that there were several arguments about land development before realizing the act. Therefore, the committee has stated in the law that the commercial development of MRTA land will be for the activities necessary for the MRTA services, not commercial development. "We (MAP Pheeraphongse and Transportation Committee) have made several reviews of the Act while MRTA keeps insisting that the new MRTA Act should have a provision allowing the commercial exploitation or the government needs to pay an annual bail out since MRTA becomes a loss-maker. We keep responding to the MRTA's request that we cannot allow MRTA land development beyond the activities that increase the travel convenience for the passengers. Any further land development must be done on the land MRTA purchases, not land MRTA has expropriated"

Advising the Government that "Allowing MRTA to Create a New Business City... (is like) Robbing People in Broad Daylight"
MP Pheeraphongse said that it is unacceptable for government offices to exploit legal loopholes to pay very low for expropriation while milking high profits from commercial rents. If MRTA insists that they have legal rights to do so, he will oppose such a deal at all costs. He believes that the mass media and the former owners of the land will never allow such a dirty deal to exist. Nevertheless, it depends upon the Thaksin government to make a decision on this issue. If the Thaksin government accepts the MRTA land development scheme, the Thaksin government will be condemned as "bandits robbing people."

Stealing 700 rai of expropriated land to construct a shopping center
Siam Business Weekly (AKA Siam Turakij), Vol. 7, No. 334, May 6-12, 2001

Note: This is a rather repetitive article from Siam Turakij, a newspaper that has been very harsh in its criticism of MRTA and their "dirty land deal."

MRTA acts as if it were a cowboy by drafting a land utilization plan to use almost 700 rai of MRTA depot land (more than 1 million square meters of office space) for commercial deals such as a giant convention center, commercial buildings, department stores, and a shopping center without delay. Furthermore, MRTA is going to send the plan to the MRTA Board on May 23 to approve the land utilization for commercial deals.
The MRTA director said that the government will have to subsidize the subway and carry a heavy burden of debt from the operation unless the plan for commercial land utilization become a reality. On the other hand, the law experts point out that "the 90 billion baht commercial deal on MRTA land" is illegal and unconstitutional since it violates the land expropriation term which limits land utilization to activities relating to mass transit operation and the facilitation for the passengers. Therefore, such commercial deal is going to distort the MRTA act for their own gain. MRTA has no right to exploit their land by the construction of a shopping center, a hotel, and commercial buildings.

If MRTA insists that it has the legal rights to do so, lawyers said the former landowners can file lawsuits against MRTA to get their land back to prevent the MRTA land deal from becoming a precedent for other public offices to rob land from the poor and powerless by land expropriation for a bargaining cost and sell the land plot to capitalists with sky-high prices.
There are controversies about the law in MRTA Act of BE2543 (AD2000) which becomes effective on December 1, 2000 which states that MRTA has the power to develop the expropriated land for commercial uses so as to support mass transit operations despite the 1992 Royal Proclamation of MRTA Organization and 1993 Second Royal Proclamation of MRTA Organization. These do not state that MRTA had power to make commercial development on their land at all. MRTA has continuously attempted to pursue the government to issue an act that empowers MRTA to make a commercial deal on their land with claims that it is impossible to profit from ticket fees alone.

Many people oppose such a deal. MRTA also said they have an "air right" to build high-rise buildings on their land for commercial development. However, the Council of State has explicitly stated that MRTA has NO RIGHT to make a commercial development on the land they expropriated from local people. Nevertheless, MRTA eventually succeeded in lobbying the government to pass an MRTA Act which states in Article 9(11) that "MRTA shall have rights to develop the expropriated land for MRTA services." Such a statement is therefore a hidden agendum to exploit expropriated land for commercial deals. The 900-rai area left over from the construction of MRTA depot and maintenance center (300 rai) is in Tiam Ruam Mitr-Rama IX Road area - a business area with a market price of 150,000 - 250,000 baht/square wah (400 square wah = 1 rai, 1000 square wah is about 1 acre). Such a treasure trove has a price of 90 billion baht (US$ 2.25 billion).

Recently, Governor Samak Sunthoravet sent a proposal to rent 153 rai of MRTA land for the Bangkok Night Bazaar to sell famous product from all 76 provinces around the country to tourists and to comply with the government policy to promote the local products (1 commune, 1 product). Furthermore, MRTA is making a move on commercial development on their land by hiring Richard Ellis Co.Ltd. and BMGM Co.Ltd (consulting companies) to study the maximum utilization of MRTA land.

Plan for commercial exploitation of MRTA land ready to deliver to the board on May 23, 2001
Praphat Jongsa-Nguan (MRTA Director) talked to Siam Turakij correspondents about hiring consultant companies to study the masterplan for MRTA land utilization around the maintenance center. The preliminary masterplan is done and MRTA has delivered the plan to the Huay Kwang Civic Society led by Assistance Professor Pongporn Sudbunthud so that people around Huay Kwang area can participate in the masterplan drafting. Huay Kwang Civic Society want more land for a public park and MRTA does not object to the plan. After Huay Kwang Civic Society's response, MRTA will send the proposal of land allocation to MRTA Board headed by Dr. Suphachai Phisitwanit on May 23, 2001. Praphat said that the commercial development of MRTA land does not violate the 1987 Royal Proclamation of Land Expropriation since MRTA actually uses the expropriated land for mass transit affairs through the construction of a maintenance center. The leftover land will be developed for commercial deals which has been approved by the government, National Assembly (MPs and Senators) through the MRTA Act of 2000. The latest news is that Governor Samak Sunthoravet has issued a letter to MRTA about the 153-rai land lease for the construction of a "Bangkok Night Bazaar". Mr. Praphat said he considered such a plan would be a beneficial plan for both MRTA and the public, so he send the proposal to the MRTA Board and Governor Samak will report the land utility plan in front of the MRTA Board personally.

Praphat said the prohibition on commercial development of MRTA land will force the government to carry a heavy burden of debt and operational loss
Praphat said the commercial land development came out of the mind since the first days of the MRTA organization since they saw that most of the mass transit systems around the world have to carry heavy loss (Singapore MTA is an exception due to the strong connection with the government). Therefore, MRTA must find other sources of income which is commercial land development. If MRTA cannot make a commercial land development, the government has to carry a heavy operational loss from MRTA in the same way as they have to deal with SRT. Therefore, the commercial land development will reduce the operational loss. The land for commercial deal is the land left over after the MRTA Depot and Maintenance Center. If MRTA completes the Orange Line in the next 20 years, MRTA will need the second maintenance center next to the first maintenance center. Mr. Praphat said "MRTA needs to expropriate 1200 rai of land at that time since the MRTA masterplan said MRTA should have 300 rai of land for Blue Line, 30 rai of land for the Orange Line and 300 rai of land for Nong Ngoo Hao line after transferring the Skytrain operation from BTSC and Hopewell line to MRTA in the next 30 years. However, the current situation have trimmed down the land plot for MRTA. Therefore, the commercial development of land is a must no matter who is the MRTA Director. It is possible to prohibit MRTA from making commercial land development but the government has to deal with the consequence since the concession holder cannot accept the responsibility on operational loss."

MRTA allocating almost 700 rai of land for commercial exploitation
MRTA told Siam Turakij that the masterplan for commercial land development states that MRTA can use 1 million square meters (625 rai) of MRTA land for commercial deals without defining the types of business, and open for all type of legal business to grow on the land. However, the highest prospect will be a convention center, the shopping center, and trade center. Dr. Sombut Kitjalux (BMCL CEO) said BMCL (the concession holder of Blue line subway) has a right reinforced by the MRTA Act to make a commercial development in the 18 stations. So far, the company is studying about the commercial development plan for subway stations, but the company will not rush the plan out since it still has time until the official opening of the whole system in July or August 2003. So far, BMCL found that they can make a commercial development in ONLY 9 stations. The other 9 either have very little space left or MRTa will turn them into a museum. Nevertheless, the commercial development of station is NOT the main source of income since they expect 5% of all revenue from the commercial development The other 95% will come up from the subway fare.
The following stations will not have commercial development for the following reasons:
1) Hua Laphong (museum)
2) Silom (narrow space for interchange station)
3) Bon Kai (narrow space)
4) Queen Sirikit National Convention Center (Thai design inside)
5) Asok (narrow space for interchange station)
6) Rama IX (narrow space)
7) Lad Phrao (park and ride)
8) Mochit (narrow space for interchange station)
9) Kamphaengphet (narrow space and the weekend market)

Huay Kwang Civic Society's opinion of the MRTA commercial megaprojects
Mr. Prasit Krairoek (Deputy chairman of Huay Kwang Civic Society) told Siam Turakij correspondents that Assistant Phongporn (Chairman of Huay Kwang Civic Society) has discussed with MRTA about the masterplan for the land development and found that MRTA will use the land for a giant convention center which is much bigger than Queen Sirikit National Convention Center, as well as department stores and hotels. The height of each project is not defined yet but should be high enough to gain enough revenue to sustain the operation with little or no government subsidy.
So far, Huay Kwang Civic Society does not object to such a land development per se. However, Huay Kwang Civic Society told MRTA that it should allocate the land for a new cultural center from the four regions of Thailand (Central, North, Northeast, and South), with folk products from all parts of Thailand to show Thai traditions and culture to foreign travelers. Furthermore, Huay Kwang Civic Society asks MRTA to allocate the land for a new public park with a Public Relations Center to facilitate connections with other mass transit systems. After the discussion, MRTA said they feel very glad with the ideas from Huay Kwang Civic Society and they will add the ideas into a revised masterplan for the land development before MRTA make an official act of the masterplan.

Cheap land expropriations/expensive commercial land development is totally unfair!
Law-expert senators advising the former landowners to file a lawsuit against MRTA to get their land back
Law experts have reached the consensus that MRTA Act of 2000 intends to empower MRTA to develop the land to facilitate passengers' convenience or other reasonable necessary matters relating to MRTA services, but not for commercial exploitation to gain profits which are not the main activity of MRTA. Furthermore, the lawyers feel worried that the MRTA dirty land deal through the legal distortion will result in chaos in the future since other government offices will follow MRTA examples (Actually SRT is the mother of all dirty land deal -> Central Plaza Lad Phrao is a good example).

Senator Seri Suwanphanon (a law expert) told Siam Turakij that the Article 9(11) of MRTA Act which empowers MRTA to deal with the land development for mass transit service has opened a loophole which allows the commercial exploitation of expropriated MRTA land. However, the actual principles of such authorization is that the commercial development on MRTA land is not the main activity of MRTA. Therefore, the commercial exploitation on the land for profit is unrelated to mass transit system activities. MRTA cannot sell or rent their land for profit since the land plots are reserved for public activities mentioned in the Royal Proclamation for the land expropriation
"Even though the law has authorized MRTA to develop their land, it defined that the development will have to be useful for mass transit system to ensure the passengers' convenience. Other forms for land exploitation for profit are too much since it goes against the principle of land expropriation" If MRTA insists to make commercial exploitation for profit through the loophole, Mr. Seri considers such action as a total injustice to the former landowners since MRTA paid very little to buy the land while they will collect a good profit from the land development. Therefore, the former landowners can file a collective lawsuit at the Administration Court to get their land back if MRTA insists to sell or rent those land plots for profit since it is the case that the government office causes heavy damage on people through the mishandling of land and shatters the people's trust in authority. The Administration Court will set a precedence by ruling that the government offices and state enterprises abusing their power by developing the expropriated land for the public utilities for profit is illegal since the expropriation is for public goods but not for business.

Feeling afraid that the dirty land deal will set an example to other government agencies
Seri notices that MRTA, which is a government agency, had used its power to expropriate the land via the Royal Proclamation, and the agency had lobbied the National Assembly to pass the MRTA Act to open a channel for the land development unrelated to mass transit activities. Such an illegal action will set a precedence for other agencies to follow the example.
Before passing the act, there were hot debates about this issue in the Senate. However, the Senate decided to pass the act since they consider that the principle of this act is for the facilitation of mass transit services. However, the MRTA had claimed the law to exploit the land for profit will set the precedence for other government agencies to abuse the law. "The former landowners will deeply involve in such a case by filing a collective lawsuit to get their land back at the Administration Court. If the Administration court found the legal controversies, they can deliver the issue to the Constitution Court to get the final decision since the 1997 Constitution explicitly states the land expropriation is only for the public good, not for profit." Furthermore, the Ombudsman of the National Assembly could tell the Constitution Court to decide whether the MRTA Act has any articles that go against the 1997 Constitution.

Chairman of Lawyers Association of Thailand points out that MRTA cannot make a commercial deal
Sak Kor-saeng-rueng (Senator from Bangkok and Chairman of Lawyer Association of Thailand) told Siam Turakij correspondents that MRTA have rights to develop their land only for activities relating to mass transit systems. The commercial development of their land will depend on the necessities relating to mass transit system. It is ACCEPTABLE if MRTA decides to construct stores and restaurants or other things for passengers' convenience. However, it is TOTALLY UNACCEPTABLE to exploit the land for profit since it violates the principles of land expropriation "If MRTA insist that they can exploit the land for profit, MRTA are going to violate the law. The former owners can file lawsuits against MRTA at the Administration Court to get their land back since MRTA are going to develop the land for activities unrelated to mass transit systems. If the former owners have little money for the lawsuit, the Lawyer Association of Thailand will help them without charges."

Law experts from Democrat Party pointing out that the unused MRTA land has to be returned to the former owners
Mr. Preecha Suwannathat (a former Bangkok M.P. from Democrat Party - an opposition party and law expert) told Siam Turakij that the consideration of MRTA land deal will have to be a case-by-case basis since it is acceptable to use the land to construct shops and stores for the passengers' convenience. Furthermore MRTA can make commercial development some parts of their land for their survival since other countries have done the commercial land development on mass transit land plot.
However, MRTA have to make serious consideration about the land development for activities relating to mass transit system. So far, only about 300 rai of land is used for depot and maintenance center but MRTA has expropriated 1200 rai of land. Therefore, MRTA has to come up with clear and transparent projects on the other 900 rai of MRTA land. If MRTA still have the unused land after finishing the projects, they have to return the land back to the former owners. However, MRTA violates the law if MRTA plan to exploit commercial deal on their land for profit which is DEFINITELY NOT the main activities of MRTA. The former owners can file a lawsuit against MRTA to get their land back if MRTA insists to exploit the commercial land deal.

Pointing out to the Minister Supervising on MRTA Not Letting MRTA Take Advantage of the Folks
Deputy Professor Natthaphongse Posakaputra (an instructor in Dept. of Law - Ram Khamhaeng University) told Siam Turakij that the government can expropriate the land only for public utilities according to the land expropriation law. Even though MRTA Act empowers MRTA to develop the land they have, those land plots will be developed only for activities relating mass transit system. Commercial development on MRTA land is WRONG since it violates the principles of land expropriation and the people who surrender the land to MRTA can file a lawsuit to get their land back. "The Minister who supervises on MRTA will have to control the land utilization to ensure that the land utilization is for activities relating to mass transit services. It is totally UNFAIR and UNJUST to let MRTA exploit the commercial deals on the land they had expropriate from the local folks with a dirt cheap prices since those who had sacrificed their land plots expect that MRTA will use them for mass transit systems"

MRTA Lobbying to Amend the Act - Snapping 90 Billion Baht Profit from Real Estate Deal
Siam Turakij Weekly (www.siamturakij.com), Vol.7 No. 333, April 29-May 5, 2001
From the Correspondents at MRTA/National Assembly/BMA

Unbelievable! A treasure trove inside 1200-rai MRTA land (about 480 acres) around Ratchadaphisek Inner Ring Road with a price of 90 billion baht - is found! Thanks to the new law, MRTA can develop the land they got from expropriation into commercial deals despite of heavy and bitter opposition from many people who surrendered the land only for public utility purposes. MRTA has spent their energy to lobby MPs and Senators since the first days they expropriated the land for public good to pass the MRTA Act of 2000 which became effective on December 1, 2000 - after 14 years of efforts. Now, the Huay Kwang Civic Society has jumped to oppose such dirty commercial development plans by asking MRTA to turn unused areas into a big park or green area since Bangkokians are desperate for green areas. On the other hand, Governor Samak would like to make a deal with MRTA by renting a 153-rai land for a night bazaar.
Governor Samak told the Siam Turakij correspondent that BMA has rented a 153-rai area around Tiam Ruam Mit Road next to Meng Jai Intersection (the land for MRTA depot and maintenance center), for an international night bazaar which will become a marketing center for products from all 76 provinces in Thailand. However, many people feel doubt as to whether BMA can make such a deal on public utility land. The land MRTA has is for mass transit matters (e.g. depot, maintenance center, park and ride or other relating matters), but not for commercial matters. Nevertheless, the new MRTA Act has empowered MRTA to develop the area around the depot and maintenance center for commercial purposes.

The Previous Government Passed MRTA Act Enabling MRTA to Strike a Dirty Deal
The previous administration passed the MRTA Act of 2543BE (AD 2000) which became effective after publishing on the Royal Gazette on December 1, 2000. The MRTA Act of 2543BE (AD 2000) has stated that: "Article 9(11): MRTA shall have an authority to develop the areas and buildings belonging to MRTA for the MRTA service administration."
Such an article empowers MRTA to develop MRTA land for commercial purposes despite the fact that the ad hoc MRTA Act Committee had stated that "MRTA Shall NOT have an authority to use land and other unmovable properties for commercial purposes."
The issue has become a controversial issue since many consider such that a commercial deal breaches the law that prohibits MRTA from commercial development. MRTA has attempted to strike a commercial deal on the land they have expropriated from Bangkokians living around Ratchadaphisek-Rama IX-Tiam Ruam MIT Road since they first days they expropriated the land 14 years ago (the year 1987). However, the 1992 Royal Proclamation of MRTA Organization and 1993 Second Royal Proclamation of MRTA did not mention the authority for MRTA to develop the land for commercial purposes. Therefore, MRTA decided to play evil tricks to enable them to use their golden land for commercial purposes which eventually resulted in the successful 2000 MRTA Act.

MRTA Anxious for Commercial Deals on Their Land
MRTA has attempted several times to develop their 1200-rai land around Tiam Ruam MIT Road which is supposed to be a depot and maintenance center for commercial purposes. For example, Mr. Theeraphongse Atthajarusit (MRTA Director in 1993) insisted that MRTA could use the land they expropriated for commercial purposes and called a bid to construct the MRTA depot and maintenance center. At that time, Bangkokland PCL owned by Mr. Khiree Kanchanaphak (now BTSC CEO) won the bid. Mr. Khiree planned to construct a big building which would have been the highest building in Asia. The 90-floor Grand Station City would have had department stores, stadium, apartments and condominiums--with a price tag of 100 billion baht (then US$ 4 billion). However, Bangkok Land PCL became cash strapped and the project was canceled.
After that, Mr. Sukhawit Rangsitphol (then Deputy Premier) stated that MRTA could turn the area around MRTA Depot and Maintenance Center into a Sport Complex for 1998 Asian Games after the purposed sport complex had problems finding an area to be located in. However, the project was killed after they found a places for the sport complexes at Hua Mark Stadium, Muangthong Thanee, and Thammasart University.

Nevertheless, the plan for commercial development was always in MRTA's plan, so MRTA hired Deleuw Cather Co. Ltd. to study investment potential for commercial purposes and Richard Ellis Co.Ltd. to study land potential and plan for a guideline for commercial purposes. Such procedures caused strong opposition and fury from Bangkokians who had been duped into surrendering their lands to MRTA for the public good, and not for commercial purposes, and received low payments for the land expropriations from MRTA. The market prices for the land in Ratchadaphisek-Rama IX area was approximately several hundred thousand baht per square wah (then US$1,000,000/acre), but the ETA (then the owner of MRTA) payment rate to those who surrendered the land was only a few ten thousands baht per square wah (then US$100,000/acre). Most of the land owners felt that they received unjust payments and have filed collective lawsuits at the Civil and Criminal Court to get better payments from ETA and MRTA.

MRTA's attempts to get the authority to develop the land for commercial purposes
In 1996, MRTA drafted the new MRTA Act to enable it to organize mass transit systems in the Bangkok Metropolitan Area, Suburban Bangkok, and other provinces and authority to use the land for commercial purpose as additional revenue to provide good mass transit service for people which is a loss-ridden business.
In 1997, Premier Chawalit Yongjaiyut approved such a draft so he forwarded the draft to the Council of State.
In 1999, MRTA Act was under the consideration in the National Assembly which resulted in an ad hoc committee for MRTA Act headed by Air Marshall Sombun Rahong (the Minister of PM Office) who was assigned by Premier Chuan as a superintendent for MRTA.
May 1999, the ad hoc committee had a resolution to prohibit MRTA from developing the land for commercial purposes.
However, the MRTA Act which has become effective on December 1, 2000 explicitly states in Article 9(11) that "Article 9(11): MRTA shall have an authority to develop the areas and buildings belonged to MRTA for the MRTA service administration"
However, the 1992 Royal Proclamation of MRTA Organization and the 1993 Second Royal Proclamation of MRTA Organization did not state that MRTA had a right to strike a commercial deal on their land.

Lawyers Vehemently Stating to MRTA"You have no right at all to strike commercial deals on your land!"
Many lawyers oppose MRTA from making commercial deals on their land since they consider such action is illegal since it directly violates the 1997 Constitution. The 1997 Constitution explicitly states that: "The expropriation is considered illegal and unconstitutional unless the expropriation is for public utilities set up by the government."
The MRTA's attempts to develop the land for commercial purposes appears to violate the law of the land and thus unconstitutional since the Royal Proclamation for the land expropriation explicitly states that MRTA will use the land only for mass transit services and relating matters.

Dubious and Unnecessary Land Expropriation - Hoarding 1,200 Rai of Land while Needing only 300 Rai
According to the act for the establishment of MRTA (1992 Royal Proclamation), the law did not grant any rights to MRTA to strike a commercial deal on the land. Even though MRTA stated that the commercial deal has been granted via the Air Right, we considers such a claim as nonsense. Even more important, MRTA has expropriated more land than necessary. 300 rai of land (120 acres) is enough to handle the mass transit lines from different networks after the private concessions expire in 50-60 years from now. Therefore, the former owners of the land decided to file a lawsuit against MRTA to get their land back or at least get better payment.
The MRTA depot and maintenance center area around Rama IX and Tiam Ruam MIT Road is close to Ratchadaphisek Inner Ring Road, the golden area in downtown Bangkok which real estate developers are hungry for. So far, the current price of the land is about 150,000-250,000 baht/square wah (US$ 3.75-6.25 million/acre) So far, MRTA has used only about 300 rai of land for mass transit purposes while leaving almost 900 rai of land around the depot as well as the land around the subway stations for commercial purposes--with a price tag of 90 billion baht (US$ 2.25 billion).

Huay Kwang Civic Society Opposing the Commercial Deals while Asking MRTA to Spare Land for Green Purposes
Mr. Ronnachit Yaemsa-ard (MRTA Assistant Deputy) said to Siam Turakij correspondents that MRTA had hired Richard Ellis Co.Ltd. and BMJM Co.Ltd. (consultant companies) to make a second study about the land utility around Rama IX and Huay Kwang area after receiving strong opposition from the Huay Kwang Civic Society a few months ago. Huay Kwang Civic Society asked MRTA to include the green area (e.g. a public park) in the MRTA land utility masterplan while limiting the commercial uses of the land to low-rise buildings. Thus hotels and department stores are prohibited from this area to minimize detrimental effects on those who live nearby (e.g. suburb villages around Huay Kwang-Sri Wara-Rama IX Road area). The study results from the consultant companies will come out in the next few months. Mr. Ronnachit said the MRTA Act of 2000 has empowered MRTA to strike commercial deals on the land MRTA has, but only on the land leftover after the construction of depots and maintenance center.

History of the MRTA Project
1971-75 - Thai government received cooperation from the German government in the form of the experts to survey and draft the Bangkok traffic and transportation masterplan and ask the government at that time to construct a Bangkok Mass transit system. Therefore, the government at that time asked the Expressway Authority of Thailand (founded in 1972) to deal with mass transit services while planning expressway construction.
1978-79 - The Gen. Kriangsak Chamanan (Premier at that time) government had a policy to let the private sector deal with mass transit projects.
1981 - The Gen. Prem Tinnasoolanon (Premier at that time - now the Statesman and the head of Privy Council of His Majesty) government came up with the first three mass transit lines (Governor Samak's pet project - at that time Governor Samak was Minister of Communication) which were as follows:
1) Phra Khanong-Hua Lamphong-Bangsue (Rama IV Line) - 23 km
2) Wongwianyai-Sathon-Lad Phrao (Sathon Line) - 20 km
3) Dao Khanong-Memorial Bridge-Makkasan (Memorial Bridge Line) -16 km
However, no private sector had any interests in the project since they considered none worthy to invest in. Therefore, the readjustment in 1984 resulted in a join venture between the public and private sector (SN Lavalin Co.Ltd. from Canada) and the scaled down version of the mass transit lines which were as follows:
1) Phra Khanong-Hua Lamphong-Bangsue (Rama IV Line) 23 km
2) Sathon-Lad Phrao (Sathon Line) 18 km
However, such projects failed to materialize since SN Lavalin Co.Ltd. had no financial resources to back up the project and this resulted in the no-confident censure in 1985-6. Eventually, the Lavalin deal was canceled in 1992.
After that, Mr. Anand Panyarachun government established MRTA by 1992 Royal Proclamation to take over responsibility of the mass transit project from the Expressway Authority of Thailand and drafted the development plan for MRTA as "the First MRTA Project". On January 19, 1993, the cabinet had a resolution to allow the private sector to deal with the project. If the private sector declined the invitation, MRTA would take over the project. After that, the government invited three private firms to compete for the project:
1) Bangkok Land PCL
2) Thanachart Holding PCL
3) Thanayong Co.Ltd.
Bangkok Land PCL won the bid, but the financial problems killed the chance to realize the plan since the subway requires much more dollars than that of a skytrain at the same distance.

Comments:
Bangkok Land PCL and Thanayong Co.Ltd. are closely related companies since they belong to the Kanchanaphak clan - Bangkok Land CEO is Anant Kanchanaphak and Thanayong CEO is Khiree Kanchanaphak.

MRTA will have to follow the new consultant's result which includes a public park area on the 1200 rai of land and prohibition of high rise building construction. Otherwise, MRTA will be in very serious trouble from former landowners and residents around the Huay Kwang area. Several people who were adults during the 1960's witnessed the dirty land deals of SRT which fooled gullible farmers and Bangkokians in the area around Chatichak Park, Central Lad Phrao, Queen Sirikit Park and Rotfai Park which are close to Bangsue Junction and would have become a new Bangkok Railway Station. So farmers decided to surrender their land for such noble ideas without bargaining prices. However, SRT leased the land to construct Central Plaza Lad Phrao and Central Lad Phrao since they could not resist a good deal from the Jirathiwat clan. Furthermore, such leases did cover heavy operational losses SRT had (and still has). There were several dirty deals like the SRT deal during the 1950-70's which resulted in landless farmers and sharecroppers. Therefore, 1997 People's Constitution prohibits the expropriations except for public utility and related matters.

If you notice the three mass transit lines which were a pet project of Samak, you will see the similarity between the 1981 plan and 1995 masterplan. However, the difference is the route redirection to major roads like Sukhumvit, Silom, Rama IV, Phaholyothin Phyathai and Ratchadaphisek inner Ring Road. The third line resembles the Northwest and Southwest section of Hopewell and MRTA Orange line.
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