Future Group, Reliance Retail, Amazon: The Maze Of Litigation Explained
Arbitrators, judges, atleast four courts and hundreds of hours of arguments later the Future Retail (plus Reliance Retail) versus Amazon battle seems to have reached its final destination — a conclusive hearing in the Supreme Court of all the various issues pending before it in this one-deal-gone-wrong-holding-up-another-deal matter.
On Tuesday, the Chief Justice of India expressed unhappiness over the heavy volume of documents filed by both parties and directed them to submit short synopsis of their arguments.
Short is good. That's what we are doing here too. Giving you the full winding case, that has spanned over a year... in short.
What happened. Who's involved. Where it's headed.
2019: Amazon invested in Future Coupons Pvt. Ltd. and got indirect stake and rights over Future Retail Ltd.
2020: Future Retail was part of the Future Group deal to merge retail assets with Reliance Retail Ventures Ltd.
Soon after, Amazon commenced arbitration to block the Future - Reliance deal.
Future Group is founded by Kishore Biyani (extreme left in the picture below). He's group chief executive officer.
Mukesh Ambani leads Reliance Industries Ltd., founded by his father. He's chairman and managing director.
Jeff Bezos is the founder and chairman of Amazon.com Inc.
Where It's Headed
The dispute, which started in October 2020 with an interim order of a Singapore-based emergency arbitrator, has travelled multiple courts and tribunals in Delhi and Mumbai.
Currently, proceedings are pending in the Supreme Court of India, the Delhi High Court and the National Company Law Tribunal.
Here's a synopsis of the maze of litigation between Amazon and Future Group.
The Singapore Leg
An emergency arbitrator based in Singapore grants Amazon an injunction. Directs Future Group to not proceed with Reliance Retail deal.
The Singapore arbitral tribunal confirms the emergency arbitrator’s order. Says Future Retail is party to dispute between Amazon and Future Coupons.
Final arbitration hearing is ongoing.
Delhi High Court Round-1
After the emergency arbitrator’s order, Amazon wrote to regulatory authorities requesting them not to grant approval to Future Group-Reliance Retail transaction.
Future Retail approaches the Delhi High Court seeking to stop Amazon from writing to regulatory authorities.
The high court bench of Justice Mukta Gupta declines Future Retail's request. But makes prima facie observations that Amazon’s agreements with Future Group may be violative of FDI regulations. Amazon challenges the observations before a division bench. Case is pending.
Delhi High Court Round-2
Amazon approaches the Delhi High Court seeking to enforce the Singapore emergency arbitrator’s order of status quo on Future Group-Reliance Retail deal.
Single judge bench of Justice JR Midha orders an interim status quo which was subsequently stayed by a division bench of the high court. The case then lands up at the Supreme Court which directs the NCLT to not pass any final orders on the transaction.
Justice JR Midha holds the emergency award to be enforceable. Directs attachment of properties of Future Retail's promoters for violating the emergency arbitrator’s order. Future Retail appeals against the order before the division bench which grants an interim stay.
Future Retail approaches Delhi High Court against Singapore tribunal's order that concluded Future Retail is a party to the arbitration dispute and declined to vacate the emergency arbitrator’s status quo order.
CCI’s Unique Dilemma
In 2019, the Competition Commission of India approved the deal between Amazon and Future Coupons.
The independent directors of Future Retail write to the CCI seeking revocation of the approval for the Future Coupons-Amazon transaction.
CCI directs all parties to appear before it on Jan. 4, 2022.
Meanwhile, on CAIT’s petition, the Delhi High Court gives the regulator two weeks to decide on the issue.
Consequently, the CCI’s timeline to determine the issue is unclear.
Supreme Court of India
A bench presided by Justice RF Nariman upholds the validity of emergency arbitration. Says division bench did not have the jurisdiction to hear appeal against Justice Midha’s order.
After the ruling, Future Retail appeals against Justice Midha’s order to the Supreme Court instead of the division bench of the high court
Supreme Court passes a consent stay order on proceedings before the Delhi High Court for the time being. Asks regulatory authorities to not pass any final orders on Future Group-Reliance Retail deal.
The final arbitration hearing between Future Group and Amazon commences. The proceedings are likely to be completed by early 2022. Supreme Court to resume hearing petitions pending before it on Dec. 8.
National Company Law Tribunal
September 2021: NCLT allows Future Retail to hold creditors', shareholders' meet to seek approval for deal with Reliance Retail.
October 2021: NCLT allows Reliance to hold creditors', shareholders' meet for transaction with Future Retail.
November 2021: Future Retail seeks to defer shareholder and creditors' meet. NCLT directs a stay instead.