The Singapore International Arbitration Centre (SIAC) recently issued an interim order requiring Future Group, India to pause its plan of selling its retail business to Reliance Group, till it delivers the final decision the regarding the petition filed by Amazon, USA. In the meanwhile, there is a possibility that Future Group will approach the Delhi High Court to challenge this interim order.
Earlier in October 2020, Amazon had filed an arbitration claim before the SIAC arguing that Future Group had breached the contract through which the former had purchased an indirect stake in the latter’s retail business in 2019. Amazon claimed that since the proposed deal between Future Retail and Reliance Industries did not have its approval, the deal could not go through.
According to Amazon’s interpretation of the contract at issue, Future Retail could not sell or transfer any shares to Reliance Industries or any other third party competitor and additionally, Amazon had the first right to buy or refuse any such shares or other assets. Amazon further contended that the contract imposed this restraint on Future Group since the date it was executed and that by negotiating a deal with Reliance so sell or transfer its assets, the contract had been breached.
Indraneel Gunjal is an attorney from India and an advanced degree graduate from Stanford Law School, Class of 2020 with a specialization in International Economic Law, Business & Policy. Before joining Stanford, he worked with the Trade Policy Division of the Department of Commerce, Government of India where he was a member of the legal team representing India in its inter-state trade and investment disputes, Free Trade Agreement (FTA) negotiations, and also tasked with formulating and reviewing its trade policy.