LEGISLATURE PRESIDENT ON CONSTITUTION, FOREIGN

C O N F I D E N T I A L SECTION 01 OF 03 BANGKOK 002580

SIPDIS

SIPDIS

E.O. 12958: DECL: 05/09/2017
TAGS: PGOV PREL PHUM ECON EINV KDEM TH
SUBJECT: LEGISLATURE PRESIDENT ON CONSTITUTION, FOREIGN
BUSINESS ACT

REF: BANGKOK 2071 (FBA SENT TO LEGISLATURE)

BANGKOK 00002580 001.2 OF 003


Classified By: Ambassador Ralph L. Boyce, reason: 1.4 (b) and (d).

SUMMARY
--------------


1. (C) Legislature President Meechai Ruchupan told the
Ambassador that the public held valid concerns about
provisions of the draft constitution. The legislature would
soon produce its official comments on the draft. Regardless
of the content, the draft's fate in the upcoming referendum
would likely depend on the extent of opposition by political
figures able to influence voter behavior. If the draft were
to be voted down, elections would necessarily slip to 2008,
as the authorities would need time to produce a new draft,
which would not be subject to a referendum. The Ambassador
stressed USG interest in elections this year, and also noted
other developments that would be of concern. Meechai and an
accompanying colleague predicted amendment of the Foreign
Business Act this year, with a possibility of grandfathering
some rights of existing ventures. End Summary.

CONSTITUTIONAL PROVISIONS
--------------


2. (C) National Legislative Assembly (NLA) President Meechai
Ruchupan told the Ambassador during a May 7 lunch that
numerous provisions of the draft constitution appeared
controversial. Unfortunately, Meechai noted, those who
supported the current draft tended to remain quiet, while
only those who disagreed with its contents spoke up; the tone
of public discourse was, therefore, largely negative. Much
criticism had been focused on the proposed Senate, which
would consist of members selected by a committee of
high-ranking officials. (Note: Such selection would be
consistent with Thai practice prior to 1997; from 1997 until
2006, the Senate consisted of elected representatives who
were ostensibly nonpartisan but, in fact, aligned themselves
with political parties. End Note.)


3. (C) Meechai noted that some were uncomfortable with the
prospect of an appointed Senate exercising the same lawmaking
authority as the previous elected Senate; an appointed Senate
might be easier to accept if its authority were reduced.
Alternatively, people might be more willing to accept an
appointed Senate if there were some (undetermined) mechanism
allowing the electorate to influence the appointment process.
The Ambassador asked whether there might be a provision for
a mixed Senate, consisting of some appointed and some elected
members. Meechai noted some previous Thai legislatures had
such a composition, but this had generally promoted divisions
between the two classes of legislators.


4. (C) Another provision provoking controversy would
establish a crisis committee. Meechai said this committee's
powers and role remained unclear (especially the extent to
which it would take on a role currently played by the
courts),so people viewed this committee warily. While
establishing a new system of multi-member electoral districts
for the House of Representatives, the constitution left
unclear how many votes voters could cast -- that is, if a
district were to be represented by three legislators, would
the voters be able to vote for three people, or just one?


5. (C) Meechai said that Buddhist organizations had hoped for
years that they would be able to establish greater state
support for Buddhism's role in Thailand. Thus, the pressure
to establish Buddhism as a state religion was predictable.
The Ambassador noted the current circumstances, including an
active separatist insurgency in the predominantly Muslim
southern provinces, might not prove conducive to such a move.
He asked whether Thailand, like Indonesia, might be able to
provide official recognition of more than one religion.
Meechai said such a solution would not be tenable; until the
present day, no religion other than Buddhism had featured in
Thai constitutions.

CONSTITUTIONAL PROCESSES
--------------


6. (C) The Ambassador asked about the NLA's role in providing
its views on the draft constitution to the Constitution

BANGKOK 00002580 002.2 OF 003


Drafting Committee. Meechai explained that the NLA would
take a more comprehensive approach than most other state
institutions, which would just focus on their areas of
interest. The NLA, by contrast, would offer comments on the
draft, from beginning to end, just as if it were a bill. An
NLA committee, chaired by constitutional scholar Wissanu
Krea-ngam, was currently leading this process.


7. (C) Meechai conceded that few people knew the details of
the draft constitution's provisions. The high-ranking
officials who studied and commented on the text would have
little influence when the draft would be up for vote in a
referendum. At that time, Thai voters, who tend not to delve
into finer points of law, would look to local leaders for
guidance. The referendum might well become a vehicle for
those opposed to the current government leaders to attack
them politically. Some people were already trying to stir up
trouble, Meechai noted. And if the constitution were to fail
in the referendum, the Council for National Security (CNS)
and the Government would have 30 days to pull together a new
charter. This would necessarily delay the next election
until sometime in 2008.


8. (C) This prospect was worrisome, the Ambassador said. The
USG felt strongly that elections should take place this year.
Parenthetically, the Ambassador also noted that we would
look very negatively on any sort of "re-coup" that might
upend the movement toward returning to democracy. Even short
of a military seizure of power, the USG would view it as
inappropriate for a sitting member of the CNS to become the
Prime Minister. Additionally, we would oppose any
application of the government's emergency decree in areas
(namely Bangkok) where there was no evidence such a move was
warranted. (Comment: Meechai enjoys access to and influence
with CNS figures, so we believe it was useful to stress these
points with him. End Comment.)


9. (C) Meechai said that, to ensure a smooth transition, the
CNS should mobilize an effective public relations campaign on
the constitutional referendum. The Ambassador said the CNS
had not yet shown an aptitude for public relations and had
not used television broadcasts to get its message out.
Meechai noted that personal contact with influential figures
at the local level would prove more valuable than a
television campaign.

VIEW OF SURAYUD
--------------


10. (C) The Ambassador solicited Meechai's view of Prime
Minister Surayud Chulanont. Meechai said he felt badly for
Surayud, whom he characterized as an honest man who lacked
the support of an effective cabinet. Meechai felt Surayud
might have set an overly ambitious agenda for himself, by
taking on such difficult issues as the southern insurgency
and police reform.

FOREIGN BUSINESS ACT
--------------


11. (C) The Ambassador also raised the NLA's current
processing of the draft amendment to the Foreign Business Act
(FBA) (reftel). The draft certainly affected other countries
interests more than those of the U.S., the Ambassador
acknowledged, but it nevertheless could harm the business
climate. Foreign corporations might see that Thailand was
changing its attitude toward foreign investment. The
Ambassador encouraged the NLA to study the likely
consequences before proceeding with the FBA.


12. (C) Commerce Ministry Permanent Secretary (and NLA
member) Karun Kittisataporn, who accompanied Meechai to the
lunch, said it became necessary to proceed with the FBA
amendment after the government discovered the wrongful use of
cutout corporations ("nominees") by deposed Prime Minister
Thaksin Shinawatra. Since then, it had become clear that the
abuses were endemic. The Thais were actually being generous
by suggesting they would only limit foreign voting rights, as
the WTO allowed Thailand to impose stricter limitations.
Karun said it was possible that the NLA would grandfather
some foreign businesses to minimize the disruption to
existing investors.


BANGKOK 00002580 003.2 OF 003



13. (C) The Ambassador asked whether the FBA amendment, in
whatever form, would pass this year. Meechai said it would,
as the NLA would have to pass the bill prior to the
expiration of its term, which would be this year. Meechai
said there would be no public hearings on the FBA amendment
before its second reading. He said "seminars" were possible
to explain the bill's provisions to affected businesses, but
only after the bill passes.

COMMENT
--------------


14. (C) We tend to agree with Meechai that the constitution's
fate will depend not so much on the fine points of its
provisions, but rather on how political machines mobilize
voters. Meechai and his colleagues did not appear concerned
about the prospects of the FBA amendment to further damage
Thailand's investment climate, our entreaties to the contrary
notwithstanding.
BOYCE