Future Group on Tuesday rejected the Delhi High Court proposal to initiate talks with Amazon to reach an amicable resolution.
“Talks will not lead anywhere, the bus has left the bus stop. Can’t accede to talks. ED has also started probing Amazon, at this stage can’t enter talks,” said Future Group.
The Delhi High Court had earlier sought to know whether US-based e-commerce giant Amazon and Kishore Biyani-led Future Retail Ltd (FRL) were open to resolving the issue arising out of Rs 24,713 crore deal between FRL and Reliance Retail on February 1.
The counsel for both Amazon and Future Group had submitted that they would seek instructions and inform the court on February 2. The court was hearing a plea by Amazon seeking direction to order enforcement of the award by Singapore’s Emergency Arbitrator (EA) restraining FRL from going ahead with its Rs 24,713 crore deal with Reliance Retail.
Amazon.com NV Investment Holdings LLC, in its plea, also sought detention of the Biyanis, directors of Future Coupons Pvt Ltd (FCPL) and FRL and other related parties in civil prison and attaching of their properties for alleged “wilful disobedience” of the emergency arbitrator’s order.
Amazon has approached the high court seeking to restrain Kishore Biyani-led Future Group from taking any steps to complete the transaction with entities that are a part of the Mukesh Dhirubhai Ambani (MDA) Group. It also sought to restrain Future Group from taking any steps to transfer or dispose of FRL’s retail assets or the shares held in FRL by the Biyanis in any manner without prior written consent of Amazon.
The Future Group and Amazon have been locked in a battle after the US-based company took FRL into emergency arbitration over alleged breach of a contract between them.
The three domestic firms — FRL, FCPL and Reliance — have however contended before the high court that if Amazon’s claim that it indirectly invested in FRL by investing in FCL was accepted then it would amount to a violation of Indian foreign direct investment laws which permit only 10 per cent investment by a foreign entity in the multi-brand retail sector.
According to Amazon, the EA award passed under the Singapore International Arbitration Centre (SIAC) Rules is enforceable under Section 17(2) of the Arbitration and Conciliation Act.
It referred to an order passed by the high court on December 21, 2020, prima facie holding that the EA’s award was valid under the Indian law.
In the petition, Amazon has alleged that Future Group, Kishore Biyani and other promoters and directors have deliberately and maliciously disobeyed the EA award despite it being binding on them and not having challenged it in accordance with the law.
In August 2020, Future had reached an agreement to sell its retail, wholesale, logistics and warehousing units to Reliance. The SIAC on October 25 2020, had passed an interim order in favour of Amazon barring FRL from taking any step to dispose of or encumber its assets or issuing any securities to secure any funding from a restricted party.
Subsequently, Amazon wrote to market regulator SEBI, stock exchanges and Competition Commission of India (CCI), urging them to take into consideration the Singapore arbitrator’s interim decision as it is a binding order, FRL had earlier told the high court.
As per the SIAC interim order, a three-member arbitration panel needs to be set up within 90 days (from the date of the judgement) with one judge each being appointed by Future and Amazon, along with a third neutral judge.
On November 10, 2020, Amazon had told the court that it and FCL have appointed their respective arbitrators.
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