Investigators allege company hid foreign control using Thai proxies.

Maroosha Muzaffar | The Independent

Summary

Thai authorities have arrested Chinese executive Zhang Chuanling linked to the construction company responsible for a high-rise tower that collapsed during a powerful earthquake that rocked Bangkok late last month.

Mr. Zhang is among four individuals wanted for allegedly violating foreign ownership laws through the use of Thai proxies to conceal Chinese control of China Railway No. 10 (Thailand), a subsidiary of a Chinese state-owned firm involved in the construction of a Bangkok high-rise that collapsed during the March 28 earthquake, killing 47. Three Thai nationals have been detained by authorities to allow further investigation. The suspects deny acting as nominees.

The 30-story government building, a joint venture with Italian-Thai Development Plc, crumbled amid the 7.7-magnitude quake that claimed over 3,700 lives in neighbouring Myanmar. Investigators allege the Chinese firm bypassed Thailand’s 49% foreign ownership limit, with Mr. Zhang holding 49% of the company. Thai Prime Minister Paetongtarn Shinawatra has ordered probes into the firm’s other projects.

Safety tests also revealed substandard steel rods from Xin Ke Yuan Steel (also partly owned by Chinese nationals) at the collapse site. The supplier denies wrongdoing.

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Xin Ke Yuan Steel faces intensified scrutiny after two types of steel rods it supplied for construction projects failed safety tests, including those recovered from the site of the deadly Bangkok building collapse. The company’s operating license was initially suspended in December following a fatal fire at its Rayong province factory. Industry Minister Akanat Promphan confirmed the failed safety standards and led an April 11 raid on the factory, revealing that steel samples seized after the December suspension had already failed two prior quality tests. [See: Company Denies Flouting Safety in Probe of Thai Skyscraper Quake Collapse].