SC sets terms to resume Amazon-frl arbitration
NEW DELHI: The Supreme Court on Wednesday directed U.S retail giant Amazon Inc and Kishore Biyani-led Future Group to resume arbitration after both parties consented to first argue the termination application filed by the latter for ending arbitration proceedings in the light of a December 2021 order of the Competition Commission of India (CCI) suspending its twoyear old approval of the Amazon-future deal.
The arbitration between the two corporate entities will resume before the Singapore International Arbitration Centre (SIAC) after it was stayed on January 5 this year by the Delhi high court on a plea filed by Future Retail Limited (FRL) citing the CCI order of December 17, 2021.
Amazon had filed an appeal in the top court against the stay on arbitral proceedings and claimed that FRL was alienating its assets to Reliance Group under a scheme signed in August 2020 for a proposed $3.4 billion takeover of Future’s retail assets which includes the flagship brand “Big Bazaar” and Easy Day stores.
A bench headed by Chief Justice of India (CJI) NV Ramana allowed Amazon to pursue its plea to restrict FRL from further alienating its assets before the Delhi high court and set aside the January 5 order staying arbitration. A joint memo on agreed action plan before the SIAC was filed by both Amazon and Future Group that was incorporated in the order.
The agreed terms recorded in the order said, “The parties will approach the arbitral tribunal to resume the arbitration proceedings on an understanding that the arbitral tribunal will hear and dispose off FRL’S Termination Application and the Termination Application filed by Respondents 2 to 13 (other Future Group companies) under Section 32(2)(c) of the Arbitration and Conciliation Act, 1996 in priority to other matters and pass orders.” This provision of the 1996 Act states, “The arbitral tribunal shall issue an order for the termination of the arbitral proceedings where… the arbitral tribunal finds that the continuation of the proceedings has for any other reason become unnecessary or impossible.”
The bench, also comprising justices Krishna Murari and Hima Kohli, further stated in its order, “In the event the Termination Application is dismissed, then the arbitral tribunal may continue with the arbitration proceedings and conclude the hearings and pass an order or award as the case may be.” This was also one of the terms agreed to by both parties.
Amazon had invoked arbitration to stop Future Group from going ahead on its scheme with Reliance as the U.S e-tailer had invested ₹1,431 crore in Future Group as part of its 2019 agreement to acquire 49% stake in Future Coupons Private Limited.
Senior advocate Gopal Subramanium appearing for Amazon said that pursuant to the order passed by the top court on Monday, the Delhi HC took up their application for restraining further dissipation of FRL assets on Tuesday and the matter is still continuing.