And now we are back full circle, to FRL and RRVL’s statements about how the deal will proceed. Both companies have made all the relevant regulatory disclosures about the interim order from the Emergency Arbitrator (including to the Bombay Stock Exchange), but neither believes that they are bound by the order, or that there are any grounds for Amazon to interfere in their deal.
“RRVL intends to enforce its rights and complete the transaction in terms of the scheme and agreement with Future group without any delay,” the Reliance entity said in its statement.
FRL said it expected to continue with the deal “unhindered” and that the Emergency Arbitrator’s order would have to be tested in terms of jurisdiction and legality. “The company is examining the communication and the order. It may be noted that the company is not a party to the agreement under which Amazon has invoked arbitration proceedings,” it said in its statement.
FRL’s main argument against Amazon’s arbitration proceedings is this latter point, that FRL itself was not party to the agreement between Amazon and Future Coupons, which included the arbitration clause – so how can it be bound by any arbitration proceedings?
What makes Amazon’s position less than ideal is that even if FRL were to be considered party to the deal, the orders of an Emergency Arbitrator at the SIAC, are not enforceable in India. The law which governs arbitration in India (including enforcement of awards of arbitrators outside India) – the Arbitration and Conciliation Act 1996 – does not recognise interim orders of an Emergency Arbitrator.
As a result, if the FRL-RRVL deal were to be concluded tomorrow, Amazon would not be able to use the Emergency Arbitrator’s order as a basis to go to court in India against the deal.