RIL-Future deal: Singapore EA award needs to be implemented, Amazon accepts sc. told
Singapore’s Emergency Arbitrator (EA) award restraining Future Retail Ltd (FRL) from pursuing a Rs 24,713 crore merger deal with Reliance Retail is valid and needs to be executed, Amazon told the Supreme Court on Tuesday. who started hearing his petitions. against the alliance.
A bench of Justices RF Nariman and BR Gavai began hearing the arguments of senior advocate Gopal Subramaniam, appearing for Amazon.com NV Investment Holdings LLC, who apprised the apex court of the facts and legal proceedings in the matter so far.
The US-based e-commerce giant said the EA award of Singapore International Arbitration Center (SIAC) was enforceable and a single-judge bench of the Delhi High Court passed an interim order in its favor to stay the ongoing amalgamation.
Subramaniam said a division bench of the High Court erred in considering the appeal of Future Group and granting relief to it by paving the way for the deal.
Criticizing the order, Amazon’s senior counsel said, “Emergency arbitrator (EA) is not a quorum non-judicial” (not before a judge) and therefore the award of EA is enforceable and the High Court is subject to arbitration and conciliation provision. is under. The Act has to act to execute it and not sit in appeal against the interim award.
The top court will start hearing the petitions on Thursday or next Tuesday.
In its interim order on February 22, the top court had asked the National Company Law Tribunal (NCLT) not to pass a final order on the amalgamation.
Future Group had moved the tribunal for regulatory approval for the Rs 24,713 crore deal with Reliance.
Amazon moved the top court against the Delhi High Court’s division bench order, which paved the way for the Reliance-FRL deal.
On February 8, the division bench had stayed the single-judge direction to the FRL and various statutory authorities to maintain status quo on the mega deal.
The interim direction was passed on the appeal of the FRL challenging the February 2 order of the single judge.
In August last year, Future Group had entered into an agreement to sell its retail, wholesale, logistics and warehousing units to Reliance.
Subsequently, Amazon took FRL to EA before SIAC over alleged breach of contract by Future Group.
Amazon had earlier filed a petition before the High Court (Single Judge) to enforce the October 25, 2020, EA award by SIAC restraining FRL from pursuing the deal with Reliance Retail.
The High Court bench, however, said it was staying the single-judge order as FRL was not a party to the Share Membership Agreement (SSA) between Amazon and Future Coupons Pvt Ltd (FCPL) and not the US e-commerce giant. was. A party to the deal of amalgamation between FRL and Reliance Retail.
It had further said that it was a prima facie view that the Shareholding Agreement (SHA) between FRL and FCPL, SSA between FCPL and Amazon, and the deal between FRL and Reliance Retail are separate and, therefore, cannot be group principles of companies. called upon.
The court gave another reason for its interim order that there was no prima facie reason to seek an order of status quo before a single judge.
The High Court had said that the matter involved a lot of contentious issues and it would not decide on them at this stage.
It also said that its comments were prima facie only and that the single judge should not have been influenced by them when SIAC’s plea to enforce the EA award restrained FRL from proceeding with the deal.
FRL, in its appeal, had claimed that it would be a complete disaster if the February 2 order was not stayed as the proceedings before the NCLT for approving the amalgamation plan have been stayed.
It had argued that the status quo order of the single judge would effectively derail the entire scheme which has been approved by the statutory authorities in accordance with the law.
In its suit before a single judge to enforce the EA award, Amazon has sought to restrain FRL from taking any steps to complete transactions with entities that are part of the Mukesh Dhirubhai Ambani (MDA) group.
Amazon has also sought the detention of Biyanis, directors of FCPL and FRL and other concerned parties in civil jail and attachment of their properties for alleged willful disobedience to the EA’s order.
Following SIAC’s EA order, Amazon wrote to the Securities and Exchange Board of India (SEBI), stock exchanges and CCI, urging them to consider the interim decision of the arbitrator as it is a binding order.
The FRL then moved the High Court to restrain Amazon from writing to SEBI, CCI and other regulators about the SIAC order, saying it amounted to interfering with the agreement with Reliance.
On December 21 last year, a single judge passed an interim order on the FRL’s petition, allowing Amazon to write to the statutory authorities, but also observed that prima facie it appeared that US e-commerce The attempt to control giant Future Retail was in violation of FEMA and FDI. Rule.
Against the observation, Amazon appealed before a division bench and during its pendency, it sued for enforcement of the EA award.
(Only the title and image in this report may have been reworked by Business Standard staff; the rest of the content is generated automatically from a syndicated feed.)