What are the legal ramifications of the Supreme Court ruling on Amazon-Future Retail? Can Retail challenge this in future?
Answering the second question first. The answer is no because the Supreme Court has given a ruling and the Supreme Court has been consistent in upholding arbitration awards. The Supreme Court believes that arbitration is one of the alternate forms for getting judicial interpretations and in case of commercial disputes therefore, I do not see any possibility of the Future and Reliance Groups getting any relief from the Supreme Court. Amazon has certainly won the case and that is final for now.
Second point is what is the future? Reliance will have to continue its own retail business. The Future Group will have to continue its own retail business. The Future Group had entered into some arrangement with Amazon earlier before they got involved with Reliance. The Future Group has the option to pursue their own agreement with Amazon because Amazon challenged this Reliance deal.
The option before the Future Group is either to continue with its arrangement with Amazon and see what they can make out of it. Or, if they can break away from that, then once again, the deal with Reliance can be revived later provided they take a deal break with Amazon. If Amazon is prepared to release them from the earlier agreement or arrangement, then obviously Future Group is free to pursue the matter with Reliance once again but until that is done, the Amazon and the Future Group will continue to have operations as per the old agreement and that is the only option open to Future Group at present.
I want to understand today’s ruling by the Supreme Court and how it impacts the entire question mark over the jurisdiction of the Singapore court and what it means in the future if such cases emerge?
Yes, the Singapore Arbitration Centre is one of the best international arbitration centres in the world and if a foreign party as per the agreement with an Indian party has chosen the Singapore International Arbitration Centre as the venue for arbitration, then that award is binding in India. We have a law which upholds foreign awards in India also and therefore the Supreme Court has upheld that law, saying that you enter into an arbitration as per your agreement. The award given by the Singapore Arbitration Centre is now binding on both Amazon and the Future Group. You cannot challenge it. That is the message which the Supreme Court has given.
The important point which Indian companies should now keep in mind is that if they want to go for arbitration, it is always better to have an arbitration in India. India has an arbitration centre now and obviously the jurisdiction of the Indian courts will apply. If you go for international arbitration, in fact there are many public sector companies, which enter into international arbitration, that will be upheld by the courts in India. This is a clear message which the Indian corporates must keep in mind.
