India's Future Retail asks court to declare arbitration with Amazon illegal

Future Enterprises

03/01/2022 05:50

By Aditya Kalra and Abhirup Roy
    MUMBAI, Jan 3 (Reuters) - India's Future Retail  FRTL.NS 
has asked a New Delhi court to declare ongoing arbitration
proceedings with Amazon.com  AMZN.O  illegal, saying the
country's antitrust agency had suspended a 2019 deal which
Amazon used to assert its rights over Future.
    Amazon successfully used the terms of its toehold $200
million investment in debt-laden Future to block https://reut.rs/3FS0roN
 the Indian retailer's attempt to sell retail assets to a rival,
alleging breach of certain contracts. 
    But the Indian antitrust body, the Competition Commission of
India, in December suspended https://reut.rs/3qAZqLu the 2019
deal saying Amazon suppressed information while seeking
approvals.
    The long-running dispute is being heard by a Singapore
arbitration panel, but both sides have been fighting parallel
cases in Indian courts to enforce or overrule certain decisions
taken by the arbitrator.
    In the latest Future Retail filing in New Delhi, the company
argues that since the 2019 deal no longer has antitrust
approval, it has "no legal existence" in India and Amazon can no
longer assert any of its rights.
    The "continuation of the entire arbitration proceedings is a
perpetuation of illegality," Future said in its filing dated
Dec. 31.
    The case will likely be heard by judges this week.
    Future and Amazon did not respond to a request for comment.
    The filing also showed that Future's appeal to the Delhi
High Court comes after the Singapore arbitration panel did not
agree to its immediate demands to terminate the proceedings,
saying arguments would continue this month.
    Amazon has long argued that Future violated the terms of its
2019 deal in deciding to sell retail assets to Reliance, and the
U.S. company's position has so far been backed by the Singapore
arbitrator and Indian courts. Future denies any wrongdoing.
    But people familiar with the case say the antitrust
suspension could make it easier for Future to push through its
attempts to sell retail assets to Reliance and weaken Amazon's
legal position.
    The dispute over Future Retail, which has more than 1,500
supermarket and other outlets, is the most hostile flashpoint
between Jeff Bezos' Amazon and Reliance, run by India's richest
man Mukesh Ambani, as they try to gain the upper hand in winning
retail consumers.  urn:newsml:reuters.com:*:nL1N2ID0LX

 (Reporting by Abhirup Roy; Editing by Michael Perry)
 ((abhirup.roy@thomsonreuters.com; + 91 22 6180 7067; Reuters
Messaging: abhirup.roy.thomsonreuters.com@reuters.net))