RIL-Future deal: Bezos-Biyani battle begins with arbitration hearing in Singapore

RIL-Future deal: Bezos-Biyani battle begins with arbitration hearing in Singapore

Arbitration hearing pertains to a legal notice issued by Amazon for alleged breach of agreement signed with Future group. It had raised objections over Rs 24,713 crore deal saying Future Group didn't seek prior permission before signing deal with RIL

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RIL-Future deal poses a threat to Amazon's offline retail plans in IndiaRIL-Future deal poses a threat to Amazon's offline retail plans in India
BusinessToday.In
  • Oct 21, 2020,
  • Updated Feb 2, 2021 10:06 AM IST

An emergency arbitration hearing was held at the Singapore International Arbitration Centre (SIAC) in the matter of Future group's deal with Mukesh Ambani's Reliance Retail. The hearing was held last week and the verdict is expected to come in just a few days.

The arbitration hearing pertains to a legal notice issued by Jeff Bezos-led Amazon for alleged breach of agreement signed with the company. It had raised objections over the Rs 24,713 crore deal saying Future Group didn't seek prior permission from it before signing the deal with Reliance Industries.

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The arbitration matter was heard by former Singapore attorney VK Rajah on October 16, Business Standard said in a report. Former Solicitor General of India Gopal Subramanium appeared for Amazon while Singapore-based Davinder Singh for Future group company Future Coupons.

Analysts say the RIL-Future deal poses a threat to Amazon's offline retail plans in India, while making Reliance Retail an undisputed leader in the gigantic offline retail segment. India's retail market is worth Rs 1.2 lakh crore. Only 7 per cent of this is online retail, which is dominated by Amazon, Walmart-owned Flipkart and Reliance JioMart.

The deal with Future group gives a lead to RIL to hold its grip over the consolidated offline retail market. Amazon had bought 49 per cent stake in Future Coupons for Rs 1,430 crore in August 2019. Future Coupons also own 7.3 per cent stake in Future Retail, a business Biyani sold to Mukesh Ambani's RIL.

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Amazon has alleged that Future had signed a "non-compete" and "right of first refusal" clause with it but still went ahead with the deal without taking approval from the e-commerce company. Under this clause, Amazon had the first right to invest in Future Retail.

Also Read:

An emergency arbitration hearing was held at the Singapore International Arbitration Centre (SIAC) in the matter of Future group's deal with Mukesh Ambani's Reliance Retail. The hearing was held last week and the verdict is expected to come in just a few days.

The arbitration hearing pertains to a legal notice issued by Jeff Bezos-led Amazon for alleged breach of agreement signed with the company. It had raised objections over the Rs 24,713 crore deal saying Future Group didn't seek prior permission from it before signing the deal with Reliance Industries.

Advertisement

The arbitration matter was heard by former Singapore attorney VK Rajah on October 16, Business Standard said in a report. Former Solicitor General of India Gopal Subramanium appeared for Amazon while Singapore-based Davinder Singh for Future group company Future Coupons.

Analysts say the RIL-Future deal poses a threat to Amazon's offline retail plans in India, while making Reliance Retail an undisputed leader in the gigantic offline retail segment. India's retail market is worth Rs 1.2 lakh crore. Only 7 per cent of this is online retail, which is dominated by Amazon, Walmart-owned Flipkart and Reliance JioMart.

The deal with Future group gives a lead to RIL to hold its grip over the consolidated offline retail market. Amazon had bought 49 per cent stake in Future Coupons for Rs 1,430 crore in August 2019. Future Coupons also own 7.3 per cent stake in Future Retail, a business Biyani sold to Mukesh Ambani's RIL.

Advertisement

Amazon has alleged that Future had signed a "non-compete" and "right of first refusal" clause with it but still went ahead with the deal without taking approval from the e-commerce company. Under this clause, Amazon had the first right to invest in Future Retail.

Also Read:

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