SIAC order not binding: Future1 min read . Updated: 02 Nov 2020, 07:45 AM IST
- Future said it is in the process of taking appropriate legal action to protect its rights
Kishore Biyani’s Future Retail Ltd (FRL) on Sunday said a Singapore emergency arbitrator’s order barring the sale of its assets to Reliance Retail Ventures Ltd is not enforceable under Indian law and is not binding on the company.
On Friday, Amazon.com Inc. wrote to the Securities and Exchange Board of India (Sebi) to consider the 25 October interim judgement of the Singapore International Arbitration Centre (SIAC) stopping the $3.4 billion sale.
The deal is yet to get approvals from various authorities, including the capital market regulator.
“Future Retail is advised that an emergency arbitrator (EA) has no legal status under Part I of the Indian Arbitration and Conciliation Act 1996 and, therefore, the proceedings before an “Emergency Arbitrator" are void and coram non judice," Future Retail wrote to the stock exchanges, adding that any attempt on the part of Amazon to enforce the order will be resisted.
Future Retail said that it is in the process of taking appropriate legal action to protect its rights, requesting the exchanges not to take cognizance of Amazon’s letter or the emergency arbitrator’s order.
Amazon did not immediately respond to a request for comment.
Amazon had bought a 49% stake in Future Coupons Pvt. Ltd for ₹1,430 crore in 2019, on the condition that without its consent, Future and its promoters cannot sell any stake or forge any alliance with 30 retail entities, including Reliance Industries Ltd.
Reliance Retail on 29 August acquired Future’s retail and wholesale assets.
On 8 October, Amazon moved the Singapore International Arbitration Centre, and an emergency arbitrator on October 25 backed Amazon, restraining Future from going ahead with the ₹24,713 crore sale.
In its filing, Future Retail added that the emergency arbitrator order was passed in arbitration proceedings initiated by Amazon by invoking an arbitration clause in a contract to which Future Retail is not a party.
“Instead, the only parties to the arbitration agreement are Amazon and various promoters of Future Retail. Future Retail is not a party to the arbitration agreement and, as such, could not have been joined as a party to the arbitration proceedings before Singapore International Arbitration Centre," Future Retail added.
Mint had last week reported that Amazon.com Inc. is likely to move an Indian high court by this week to enforce the verdict if Future declines to pursue arbitration proceedings in the city-state.