Norway's Telenor said it did not break the law when it set up a joint venture to increase its control over Thailand's DTAC mobile phone operator, a Dow Jones report said.
"We are confident that we're abiding by local rules and regulations in Thailand ," a Telenor spokesperson, quoted by the Dow Jones report, said.
The report said the comments followed news that Thailand's ministry of commerce would conduct an investigation into 16 local and foreign companies, including Telenor, to determine whether or not foreign shareholders had used nominees to sidestep limits on foreign holdings in Thai companies.
Under Thai laws, foreigners could not hold more than 49% in local firms of certain industries such as telecom and aviation, the report said.
Telenor holds a 33% direct stake in DTAC, but also has a 25% stake in United Communication Industry, which in turn controls 42% of DTAC. It also owns 49% of Thai Telco Holdings, which has a 40% stake in United Communication, according to the report.
The investigation comes ahead of national elections following the family of Prime Minister Thaksin Shinawatra's sale of a controlling stake in telecom holding company Shin to Temasek Holdings, the report said.
Temasek allegedly used proxy shareholdings to keep its holdings in Shin below the 49% limit, the Dow Jones report further said.