The dispute between Amazon and India’s Future Group over the Reliance takeover has worsened with the two sides failing to reach a compromise and they are returning to arbitration.
In the latest development, the Supreme Court has lifted an earlier stay order by the Delhi High Court regarding the Singapore International Arbitration Tribunal Center’s hearing of the case between Amazon and the Future Group. The top court asked Future Group and Amazon whether they had any issues with resuming arbitration proceedings and both parties confirmed that they did not have any issues.
On March 3, Amazon had proposed a dialogue with Future Group and Reliance to end the legal deadlock and the Supreme Court had given them until March 15 to come up with a settlement. However, on Tuesday both parties informed the court that negotiations between them have not led to a resolution.
Amazon approached the Singapore court in October 2020 to oppose the 247.13-billion-rupee deal signed in August 2020 between Reliance Industries and Future Group.
On Tuesday Amazon released advertisements in Indian newspapers accusing the Future Group and the Mukesh Ambani-led Reliance Retail of “fraud.” The ads took exception to Reliance Retail’s recent takeover of some of the stores of Future Group, whose lease has expired due to the non-payment of rent.
Last month, Reliance had signed lease deeds with landlords who haven’t been paid rent for months by Future Group. Initially, it sub-leased the properties to Future Group for operation. But on March 9, Future Group said in two separate stock exchange filings that it received termination notices on March 7 and March 8 for 947 stores that it had sub-leased from Reliance entities.
In the newspaper advertisement, Amazon has said: “These actions have been done in a clandestine manner by playing a fraud on the constitutional courts in India, the arbitral tribunal and Indian statutory authorities/agencies.” The e-commerce giant also accused Future Retail Ltd and its promoters of making a false submission before the Supreme Court that retail assets would continue to vest in Future Retail until the Reliance deal was approved by the insolvency court – the National Company Law Tribunal.
Appearing for the Future Group on Tuesday, senior advocate Harish Salve said, “Amazon has been driving us to the knees and they have done so. We are broke. Nothing has been transferred. The rents have not been paid for over two years, we had no money, which is what we have been telling all forums. Our rent agreements are being terminated.”