Tata Sons Responds To Docomo’s London Action, Says Not Permitted To Pay Arbitral Award Sum
Tata Sons challenges ex-parte order obtained by Docomo in London Commercial Court
Tata Sons has filed an application in the London Commercial Court against an ex-parte order obtained by NTT Docomo, the group said in an email statement.
Tata Sons’ position is that it is not permitted to pay the sum claimed by DoCoMo pursuant to the award, since regulatory approval by India’s central bank, the Reserve Bank of India (RBI), which is necessary for performance of the award, has been denied. Furthermore, absent such approval, enforcement of the award would be unlawful under applicable Indian law and contrary to public policy.Tata Sons Statement
Docomo had moved the London Commercial Court on July 25, seeking enforcement in the U.K., of an arbitral award by the London Court of International Arbitration (LCIA). The LCIA awarded $1.17 billion to Docomo in a shareholder dispute with Tata Sons pertaining to the former’s shareholding in Indian telecommunication company Tata Teleservices.
The London Commercial Court had granted Tata Sons 23 days starting July 27, to file a response.
Officials close to Tata Sons told BloombergQuint that, Tata Sons has asked the London Court in its application that, since the case on enforceability of the arbitral award is currently being contested in Delhi High Court, the London Court should set aside this ex-parte order.
Before moving the London Commercial Court, Docomo had also filed a petition with the Delhi High Court on July 7, 2016, seeking enforcement of the same arbitral award in India.
Consequent to that, Tata Sons deposited $1.17 billion, the entire award amount, with the Delhi High Court registrar, pending the court’s decision on this issue.
But on September 2, Tata Sons filed another application in the Delhi High Court, challenging the enforceability of the LCIA arbitral award.
Tata Sons’ position is that it is not permitted to pay the arbitral award, in the absence of regulatory approval from Reserve Bank of India. The RBI has twice declined its application, and enforcement of the award would be unlawful under the current India law and public policy, the group said in a statement.
Docomo in a statement said it had “hoped that Tata would join them to seek confirmation from the Delhi High Court that enforcement of the LCIA award in India would not contravene Indian law. This clarity would have smoothed the path to payment of the award in India.”
It appears that Tata is attempting to re-litigate arguments that already were fully considered and rejected by the panel of the distinguished LCIA arbitrators appointed by both Tata Sons and Docomo, the statement by Docomo said.
Docomo’s statement also said that it will take all appropriate steps to enable Tata to fulfill its payment obligations in India, and Docomo is open to any discussion with Tata and the Indian government to enable this.