Bangkok – The Office of Trade Competition Commission (OTCC) announced on Friday that it will temporarily suspend the sale of Tesco’s retail operations in Thailand and Malaysia, a transaction that could be worth as much as $10 billion. The regulator, which gained prominence after the 2017 Trade Competition Act came into force, said it will examine any prospective buyer for possible monopoly concerns.
The auction for the roughly 2,000 Tesco stores in the two countries had progressed to the final stage, with three Thai conglomerates – Charoen Pokphand Group (CP Group), Central Group and TCC Group – emerging as the remaining contenders. All three already command extensive retail networks, and the potential acquisition would dramatically expand their market reach.
OTCC Chairman Sakon Varanyuwatana told reporters that the commission possesses the authority to block a merger if it determines that the deal would create a dominant position in the market. Under the 2017 law, violations can attract fines of up to 0.5 percent of the transaction value, a sum that would amount to $50 million on a $10 billion deal. According to Euromonitor, Tesco’s Thai operations account for about 28 percent of the nation’s supermarket, hypermarket and convenience‑store sales.
The 2017 Trade Competition Act sets a 50 percent market‑share threshold for merger approval. Merging Tesco’s assets with any of the three bidders would likely push the combined share above that limit.
CP Group already runs the 7‑Eleven master franchise in Thailand, overseeing more than 12,000 convenience outlets. Adding Tesco’s larger‑format stores would give it a foothold across both convenience and big‑box segments. Central Group’s portfolio includes department stores, electronics chains and food retailers, while TCC Group – controlled by billionaire Charoen Sirivadhanabhakdi – owns breweries, hotels and its own retail brands.
The 2017 Act replaced a weaker 1999 statute that critics argued allowed large firms to operate with little oversight. It requires a merger notification when a deal exceeds 1 billion baht (around $33 million) or when a buyer would hold at least 25 percent of a market already concentrated among a few players.
Tesco’s Thai business alone surpasses those thresholds, and the prospective purchasers would also meet them given their existing market positions. With the OTCC’s intervention, the auction is now on pause. The regulator has indicated that it will await the identification of a preferred bidder before conducting a full review.
Possible outcomes include conditional approval, outright rejection, or a requirement for the buyer to divest certain assets. This is the first major case testing the powers granted by the 2017 competition law.
The decision will send a clear signal to conglomerates throughout Southeast Asia about the future of large‑scale retail consolidations in the region. All parties – the three bidders, Tesco and the OTCC – have remained tight‑lipped since the announcement. The deadline for the regulator’s assessment looms, and the potential fine of 0.5 percent of a $10 billion transaction underscores the stakes involved.
