(Bloomberg) — Future Retail Ltd. has sought to halt and terminate Amazon.com Inc.’s case at a Singapore arbitration tribunal, a move that could allow the cash-strapped Indian retailer to sell some of its assets to Reliance Industries Ltd..
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Armed with a December antitrust ruling against Amazon, Future Retail has petitioned the Delhi High Court and the arbitration tribunal in Singapore saying that continuing arbitration would be illegal. The Singapore tribunal on Dec. 30 refused to consider Future Retail’s request for terminating the arbitration before starting a final hearing later this week, prompting the Indian retailer to move the Delhi court.
If successful, the latest attempt by Future Retail can end the arbitration case that had blocked the sale of some of its physical assets like stores and warehouses to Reliance Industries Ltd. Future Retail is coming under increasing pressure from investors, with its dollar bonds on Monday dropping the most since Nov. 16 after it missed payments to lenders and its credit rating was downgraded. Its shares slipped 1.9% on a day when the broader S&P BSE Sensex advanced.
A halt or termination of the arbitration case would be a setback for Amazon, which is in a race with Reliance to dominate India’s billion-plus consumer market.
The Delhi High Court on Monday agreed to hear Future group’s petition after one of its lawyers Mukul Rohatgi cited “immense urgency” in the matter during an online hearing. Future Retail confirmed filing the petition in an exchange filing Monday. An Amazon representative didn’t immediately comment.
Future Retail contends that continuing arbitration would be illegal as Amazon’s 2019 deal, on the basis of which the arbitration was initiated, has no legal standing after the antitrust body’s order, said its lawyer Mukul Rohatgi. The Competition Commission of India last month said the deal will “remain in abeyance” and fined Amazon 2.02 billion rupees ($27.1 million) for failing to disclose that the deal would give it a right in Future Retail.
Amazon’s lawyer Gopal Subramanium said the arbitration tribunal was treating both sides equally and the American retailer is willing to make its arguments against termination of the case. Amazon will appeal against the antitrust ruling at a higher court, he said.
The court will give its ruling on Future’s petition on Tuesday, the judge said.
(Adds details from Future Retail’s exchange filing and court hearing)
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