Jeff Bezos-Mukesh Ambani spat tests India’s allure for foreign investors

Agencies
February 9, 2021

Image result for Jeff Bezos-Mukesh Ambani spat tests India’s allure for foreign investors

The tussle between two of the world’s richest men -- Jeff Bezos and Mukesh Ambani -- to dominate India’s estimated $1 trillion retail market is testing foreign investor patience with flip-flopping court rulings.

This week saw new developments in Amazon.com Inc.’s legal battle to block Ambani’s Reliance Industries Ltd. from acquiring Future Retail Ltd.’s assets, in what would be the country’s largest retail-sector deal. Last week, a single judge at a high court in New Delhi restrained Future Group firms from selling their assets. On Monday, a set of judges at the court overruled that decision. Amazon can appeal the latest ruling in the country’s Supreme Court.

The keenly watched case may set an important legal precedent for investors on whether emergency decisions by foreign arbitrators are valid in India. Amazon had petitioned Indian courts with an order from an emergency arbitration court in Singapore that barred Future Retail from making a deal with Reliance.

It could also help overseas investors judge the validity of agreements in India, which the World Bank has ranked among the bottom 15% of countries in terms of enforcing contracts, worse than Venezuela, Syria and Senegal.

“Not giving effect to a foreign arbitration award undermines India’s already floundering reputation as a good place to invest and do business in,” said Bharat Chugh, a former civil judge in Delhi and now a lawyer practicing in India’s top court. Speedy enforcement of contracts and foreign arbitration rulings are important for overseas investors when assessing the attractiveness of an investment destination, he said.

Spokespeople at Reliance Industries, Amazon’s local unit and Future Group weren’t able to comment immediately on the latest ruling. Future Retail’s lawyers have argued in court that the deal is their only chance to avoid bankruptcy and save jobs.

The rulings in Amazon’s case come after two big foreign arbitration awards against India. In September, an international arbitration tribunal said India acted unfairly in a $3 billion tax dispute with Vodafone Group Plc and in another ruling ordered India to return $1.2 billion to Cairn Energy Plc for a similar failure. India has challenged the Vodafone ruling in Singapore, India’s federal government informed Parliament on Monday.

It’s common for companies investing in India to opt for foreign arbitrations as the judicial process in the country can take years. After an overseas arbitrator makes a decision, companies can seek its enforcement via an Indian court if the opposing side doesn’t comply.

Singapore Order

In the Amazon-Future Retail case, in October a Singapore emergency arbitration tribunal ordered the Future Group to halt the sale to Reliance. Amazon cited a partnership agreement with a Future Group firm for a customer loyalty promotion that restricted the group from selling assets to Mukesh Ambani’s company and allowed arbitration in Singapore to settle disputes.

Future Retail has argued in court that the pact with another group firm doesn’t bind it and the Singapore’s emergency arbitration order wasn’t enforceable in India. That prompted Amazon to petition the Delhi High Court to ensure compliance.

Last week, a high court judge halted the deal and said he was of the initial view that the order from the emergency arbitration court in Singapore is valid and can be enforced in India. On an appeal by Future, a two-judge panel allowed the deal, saying Future Retail wasn’t a party to the agreement between Amazon and Future Coupons Pvt. A detailed hearing of the case will be held from Feb. 26, the judges said on Monday.

“Last week’s order would have been some solace to foreign investors worried about the arbitration enforcement regime in India, but the order passed on Monday against Amazon would raise fresh concerns,” said Samudra Sarangi, a partner at law firm Panag & Babu. “An appeal before the Supreme Court may be inevitable.”

Comments

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.
News Network
September 23,2024

gadkari.jpg

Nagpur: Union Minister Nitin Gadkari on Sunday teased his cabinet colleague Ramdas Athawale over his ability to hold onto his cabinet spot across multiple governments. "It may not be guaranteed that our government will return for a fourth term, but what is definitely guaranteed is that Ramdas Athawale will become a minister," he remarked at an event in Maharashtra's Nagpur.

The playful jibe, with Mr Athawale present on stage, was followed by Mr Gadkari clarifying that he was "just joking."

Mr Athawale, leader of the Republican Party of India (RPI), has served as a minister three times and expressed confidence in continuing his streak if the BJP returns to power.

Mr Athawale on Sunday said his party RPI (A), an ally in the ruling Mahayuti government in Maharashtra, should get to contest on at least 10 to 12 seats in the upcoming assembly elections. Addressing a press conference in Nagpur, Mr Athawale said the RPI-A will contest the election on its party symbol and ask for three to four seats in Vidarbha, including north Nagpur, Umred (Nagpur), Umarkhed in Yavatmal and Washim.

Mr Athawale's party is part of the Mahayuti alliance, comprising the BJP, Shiv Sena led by Chief Minister Eknath Shinde and Ajit Pawar's NCP.

The Union minister said, "The RPI-A has made a list of 18 probable seats, which it will be sharing with the Mahayuti partners in a few days and expects to get at least 10 to 12 seats in the seat-sharing pact." He said the BJP, Shiv Sena and NCP should give four seats each from their quota for his party.

In Palghar earlier this week, Mr Athawale claimed that due to the inclusion of the Ajit Pawar-led NCP in the Mahayuti government, the RPI (A) did not get any ministerial berth in the state despite a promise.

He claimed that the party was promised cabinet positions, chairmanship of two corporations, and roles in district-level committees, but all this could not happen because of Pawar's inclusion.

The elections to 288 assembly seats in Maharashtra are likely to be held in November.

In the current assembly, the BJP is the single largest party with 103 MLAs, followed by Shiv Sena 40, NCP 41, Congress 40, Shiv Sena (UBT) 15, NCP (SP) 13 and others 29. Some seats are vacant. 

Comments

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.
News Network
September 23,2024

childporn.jpg

New Delhi: Downloading and watching child pornography is an offence under the Protection of Children from Sexual Offences (POCSO) Act, the Supreme Court ruled today in a landmark judgment on the stringent law to prevent child abuse.

The bench of Chief Justice of India DY Chandrachud and Justice JB Pardiwala set aside the Madras High Court order that had ruled that merely downloading and watching child pornography was not an offence under the POCSO Act. The Supreme Court noted that the high court had committed an "egregious error" in passing the judgment.

The Madras High Court's order had come in a case in which a 28-year-old man was charged with downloading child pornography on his phone. The court had quashed the criminal proceedings against the man and said children these days are grappling with the serious issue of watching pornography and society must be mature enough to educate them instead of punishing them.

The Supreme Court today restored the criminal proceedings against the man.

At the outset, Justice Pardiwala thanked the Chief Justice for the opportunity to pen this judgment. The order focused on Section 15 of the POCSO Act which lays down punishment for the storage of pornographic material involving children.

"Any person who stores any pornographic material involving a child and fails to report or destroy it is punishable with a fine of not less than five thousand rupees., and repeat offence will be punishable with fine of not less than ten thousand rupees. If the material is stored for further transmitting or propagating, then along with fine, it is punishable with upto three years of imprisonment. For storing child pornographic material for commercial purpose is punishable with three to five years of imprisonment, and in subsequent conviction, upto seven years of imprisonment," the Section says.

Justice Pardiwala said that in this case, mens rea is to be gathered from actus rea -- mens rea refers to the intent behind the crime and actus rea is the actual criminal act.

"We have said on the lingering impact of child pornography on the victimisation and abuse of children... We have suggested to the Parliament to bring an amendment to POCSO... so that child pornography can be referred to as child sexually abusive and exploitative material. We have suggested an ordinance can be brought in. We have asked all courts not to refer to child pornography in any order," the bench said.

The Chief Justice called it a "landmark judgment" and thanked Justice Pardiwala.

Comments

Add new comment

  • Coastaldigest.com reserves the right to delete or block any comments.
  • Coastaldigset.com is not responsible for its readers’ comments.
  • Comments that are abusive, incendiary or irrelevant are strictly prohibited.
  • Please use a genuine email ID and provide your name to avoid reject.