BANGKOK – A Thai anti-corruption official on Friday said he is suing King Power, the duty free giant that owns Leicester City Football Club, for hundreds of millions of dollars over the alleged underpayment of taxes.
Charnchai Issarasenarak, head of a junta-appointed anti-graft panel, accuses King Power of under-declaring revenue to avoid paying a 15 per cent levy agreed in a 2006 contract to operate in Thailand’s airports.
“Based on the contract… in the first five years King Power must share 15 per cent of revenue with the government,” Charnchai told AFP.
But he alleges the firm illegally slashed its declared revenue from 2008 onwards “citing sluggish economic conditions” to avoid paying the sum.
Speaking later to reporters Charnchai said he is suing for damages of up to 18 billion baht (S$730 million). He confirmed King Power’s billionaire founder Vichai Srivaddhanaprabha would be named in his latest lawsuit.
An earlier suit – also brought by Charnchai – accuses 14 Airports of Thailand (AOT) and customs officials, as well as King Power executives, of colluding to collect only three per cent of the duty free giant’s annual revenue instead of the contracted 15 per cent.
“That caused some 14 billion baht damage to the state,” he said, adding: “I have asked the court to confiscate this amount of money” from the company in cash or assets.
A criminal corruption court will decide whether to accept the cases in coming days.
Airports of Thailand has denied any wrongdoing.
“AOT has managed the contract carefully whilst ensuring state and shareholders’ benefits,” it said in a July 7 statement.
King Power declined to comment, instead referring AFP to the AOT statement.
But the legal moves will be unwelcome publicity for King Power and its shrewd, well-connected billionaire founder Vichai.
The polo-playing Vichai frequently hob-nobs with celebrities and the kingdom’s mega-rich business elite.
His reputation for canny decision-making surged following the 2016 English Premier League championship win by minnows Leicester City.
Vichai has deftly tip-toed around Thailand’s treacherous politics in recent years, overseeing surging profits at his King Power empire.
He has amassed an estimated fortune of US$2.9 billion (S$4.1 billion) since establishing King Power in 1989 – starting with a single shop in Bangkok.
King Power won the duty-free concession at Bangkok’s cavernous Suvarnabhumi airport in 2006, and with it a captive market of tens of millions of travellers.
In 2007, a year after ex-premier Thaksin Shinawatra, Manchester City’s former owner, was dumped from office in a coup, Vichai saw off legal moves to break his duty-free monopoly.
He now belongs to the royalist establishment that toppled Thaksin. His family received its royal surname in 2013 – a highly symbolic gesture in kingdom where connections count.