Updated* Airports of Thailand highlights King Power Duty Free concession renegotiations
In a statement and letter to the President of the Stock Exchange of Thailand, Airports of Thailand has considered King Power Duty Free’s duty free concession contracts.
The letter refers to news that appeared on social media on June 13 2025, stating that King Power Duty Free Company Limited (KPD) submitted a letter to Airports of Thailand Public Company Limited (AOT), requesting a discussion on the possible termination of duty-free concession contracts at Suvarnabhumi Airport, Don Mueang International Airport, Phuket International Airport, Chiang Mai International Airport and Hat Yai International Airport “due to various factors”. Those factors include:
- the cessation of the operation of inbound duty-free shops as in line with government policy
- tax reduction on wine affecting sales volume of duty-free shops
- reclamation of AOT’s commercial space
- lack of proactive measures of public sector for tourist safety management resulting in a decline in the number of Chinese tourists
- Thailand’s domestic situation negatively impacting the number of tourists and passengers,
- COVID-19 pandemic situation
- war situation and global economic slowdown.
“All of these factors have direct and indirect effects on KPD’s inability to operate business and comply with the established contracts and caused KPD’s continuous loss,” the letter, which is signed by Krit Pakagij, Corporate Secretary and Authorized Person, The Corporate Secretary and Corporate Governance Department, stated.
“The abovementioned force majeure factors are beyond KPD’s control. AOT would like to inform that AOT received such letter from KPD requesting for a discussion on solutions to be able to continue its business or other settlements as well as possible termination of contracts.
“AOT and KPD need to mutually negotiate solutions based on fairness for both parties as in compliance with the defined terms and conditions of contracts. Currently, AOT is under consideration on solutions with KPD and procurement of consultant services from a public higher education institution to conduct a study and an analysis for possible solution options to duty-free shop operation problems at AOT’s airports.”
AOT said it intends to “propose the most suitable options derived from such study and analysis to proceed in accordance with the current situation for utmost benefits of AOT and fairness for concessionaires”.
“However, KPD still operates duty-free shops at AOT’s airports as usual,” AOT added.
AOT Board of Directors Meeting June 16
In an update to the earlier statement, the AOT Board of Directors, in a meeting held today (June 16), requested AOT management to expedite the appointment of a working group to consider possible solution options to duty-free shop operation problems at AOT’s airports.
Their statement included the “procurement of consultant services from a public higher education institution to conduct a study and an analysis for possible solution options to duty-free shop operation problems at AOT’s airports while considering legal, economic, financial and business management issues, analyzing constraints of previous contracts and proposing suitable and fair approaches for all parties”.
The conclusion is expected to be reached within 60 days before being further proposed to the AOT Board of Directors for consideration.
AOT will hold a discussion with KPD for the fastest possible conclusion. “However, KPD’s due payment of concession fees is still within credit limit of bank guarantee as a collateral to ensure financial obligations of KPD in case of unexpected events,” AOT noted.
AOT also underlined its “robust financial stability” and plans to seek revenue from other sources such as service fees, apron services, ground equipment, ground passenger services project and other related businesses at Suvarnabhumi Airport of the third operator as well as development of commercial land surrounding AOT's six airports, thus generating non-aeronautical revenue.
AOT added it “still has adequate liquidity for future investment projects and operations as planned without any impact on AOT's financial stability”.
