Technoglitch
Core Member
The London Court of International Arbitration is expected to give its verdict within a couple of months.
DoCoMo had sought arbitration in January last year after the Reserve Bank of India (RBI) opposed its move to exercise its option to sell back its stake to Tata Group at half its original investment, as agreed in their joint venture contract.
The crux of the argument presented by NTT DoCoMo was that during the timeframe in which its contract was enforceable, preventive rules from RBI were either not in place or were lifted.
Tata Group has maintained that it hasn't breached contract but couldn't pay its joint venture partner because the central bank regulations prevented it from doing so, sources said.
While the timeline for the final decision isn't known, lawyers said it usually takes up to two months for the arbitration court to deliver the verdict.
DoCoMo in January 2015, moved the International Court for Arbitration in London to ensure that the Tata Group finds a buyer for the Japanese telco's 26% stake in Tata Teleservices or buy back the stake at the initially agreed price.
DoCoMo has "argued that its demand is within the acceptable return at present", said one of the people. And at the time it struck the deal with Tata Group, there was no precedent or clarity on RBI's stance. As such, it argued the Tata Group had breached its contract.
DoCoMo had purchased its Tata Tele stake in instalments in 2009 and 2011 for $2.7 billion. When it started buying the stake, the telecom sector was a showpiece of the country's fast-growing economy. That changed soon, as the high prices paid by operators to acquire telecom frequencies for third-generation services in 2010 and a margin-denting price war weakened the finances of companies
Tatas set to settle row with Japan’s NTT DoCoMo | ET Telecom
DoCoMo had sought arbitration in January last year after the Reserve Bank of India (RBI) opposed its move to exercise its option to sell back its stake to Tata Group at half its original investment, as agreed in their joint venture contract.
The crux of the argument presented by NTT DoCoMo was that during the timeframe in which its contract was enforceable, preventive rules from RBI were either not in place or were lifted.
Tata Group has maintained that it hasn't breached contract but couldn't pay its joint venture partner because the central bank regulations prevented it from doing so, sources said.
While the timeline for the final decision isn't known, lawyers said it usually takes up to two months for the arbitration court to deliver the verdict.
DoCoMo in January 2015, moved the International Court for Arbitration in London to ensure that the Tata Group finds a buyer for the Japanese telco's 26% stake in Tata Teleservices or buy back the stake at the initially agreed price.
DoCoMo has "argued that its demand is within the acceptable return at present", said one of the people. And at the time it struck the deal with Tata Group, there was no precedent or clarity on RBI's stance. As such, it argued the Tata Group had breached its contract.
DoCoMo had purchased its Tata Tele stake in instalments in 2009 and 2011 for $2.7 billion. When it started buying the stake, the telecom sector was a showpiece of the country's fast-growing economy. That changed soon, as the high prices paid by operators to acquire telecom frequencies for third-generation services in 2010 and a margin-denting price war weakened the finances of companies
Tatas set to settle row with Japan’s NTT DoCoMo | ET Telecom
