Two persons with direct knowledge of the matter confirmed this on the condition of anonymity.
On 25 October, an interim emergency award by SIAC had restrained the Reliance-Future deal.
On 12 July, the Singapore tribunal will begin its hearing to pass the final order in the case involving Mukesh Ambani’s RIL and Jeff Bezos’ Amazon, which will decide who will have an edge to gain a footprint in India’s burgeoning retail e-commerce industry.
“Since the crux of the entire legal issue is the breach of the contractual agreement which falls under the jurisdiction of SIAC, this arbitration hearing is extremely important. Also, the SIAC’s order may suggest a direction for the courts in India on the pending legal case between the two parties here,” said the first person.
Although the SIAC will conduct this hearing to pass the final arbitration award after India’s Supreme Court starts hearing the matter on 28 June, the SIAC’s final verdict may come even before the apex court’s final order since SIAC typically decides faster on arbitration cases, said the first person.
On 5 January, SIAC had formed a panel of top international lawyers to hear the case. “This may be crucial because the contractual agreement between Amazon and Future Group says any dispute between the two parties will be subject to the jurisdiction of SIAC and its decision shall be binding. As per India’s arbitration law, the decision of SIAC has to be considered legally valid and enforceable,” said the first person.
Veteran barrister Michael Hwang has been appointed as the judge for the tribunal in the Amazon-Future case. Albert Jan van den Berg, the founding partner of law firm Hanotiau & van den Berg and Jan Paulsson, a Swedish arbitration veteran and founding partner of Three Crowns Llp., are the two members of the SIAC arbitration panel.
If SIAC indeed passes its final judgement before the Supreme Court spells its final verdict, Amazon and Future will be able to add SIAC’s order in their affidavits before the apex court, and it will not only be easier for the Supreme Court to prepare its judgement on the case but also bring the long-drawn legal battle to a close.
On 19 April, on a special leave petition filed by Amazon, the apex court stayed all proceedings before Delhi high court but did not stop RIL and Future from working on the deal.
On 5 May, Mint first reported that the Supreme Court has deferred the hearing of the Amazon-Future dispute to 28 June as it attends to more pressing matters amid the raging viral pandemic.
The delay actually may have come as a temporary setback for Amazon since it will buy Future Group and RIL two more months to work towards their proposed deal and realign operations, restructure businesses and transition Future Group’s staff and retail stores such as Big Bazaar and fbb. The Supreme Court has so far not stopped the two parties from working towards the deal.
On 29 August last year, Future Group decided to sell its retail, wholesale, logistics and warehouse assets to Ambani’s RIL, which has been contested by Amazon at the SIAC, with the latter stating that Future has breached its contractual agreement with Amazon by forging a deal with a so-called restricted party—RIL, without Amazon’s prior consent that was required as per the Future-Amazon agreement that was signed in August 2019.
With over 1,500 Big Bazaar and fbb stores in India, Future Group has the largest offline retail sales network in the country.
Amazon’s real battle is to gain an edge as a retail e-commerce player in India, and if the RIL-Future deal goes through, it may no longer be able to serve a segment of its customers with the same ease and speed since it will lose the privileged access to Future Group’s Big Bazaar and fbb stores in India.
To be sure, Amazon is separately embarking on a massive expansion plan to ensure that its online retail business does not get hindered in case the company loses its ongoing legal battle with Future Group.
Among a number of other ambitious targets, Amazon is planning to increase the number of its massive warehouses called fulfilment centres (FCs) by 30% within a year to have a total of 100-120 of them in India by the end of the year, so that customers even in remote locations get speedy delivery.
The Seattle-based e-commerce giant is looking to increase the number of its tie-ups with sellers (small businesses and stores) by 40% to take it to 1 million within a year; and forge tie-ups with at least 300,000 such entities whose India-made products are to be sold to customers in the US, Europe, West Asia, Japan and other developed nations.
Amazon India has drawn an internal target to increase the revenue from exports from $3 billion to $10 billion in the next four years.
This article was first published on livemint.