DoCoMo wants $1.17-b worth of Tata Group’s overseas assets to settle dispute: report
19 Oct 2016
Japan's NTT DoCoMo, the estranged partner in the now-defunct joint venture Tata Docomo, has sought the transfer of assets worth $1.17 billion from Tata Group, for an out-of-court settlement in an ongoing legal tussle.
The Japanese company has asked Tata Sons, the holding company of Tata Group, to transfer assets equivalent to the London-based arbitration court's award in the US or in the UK or any other location outside India, reports quoting sources said.
Docomo clearly wants to skirt Indian government regulations on asset transfer while Tata Group cannot violate Indian rules to settle Docomo dispute.
While Tata Group said it was ready with the award money, which is in the custody of the Delhi High Court, the company said it needs Reserve Bank of India's permission to transfer such an amount (See: DoCoMo dispute: Tata Sons to deposit $1.2-bn arbitration award with Delhi HC). The companies were looking for alternatives to settle the issue amicably through negotiations and held discussions for an out-of-court settlement. Reports said NTT DoCoMo made the suggestion in one such discussion.
Tata Sons, meanwhile, had filed evidence with the English High Court supporting an application to set aside ex-parte order obtained by the Japanese telecom major (Tata Sons seeks to set aside UK court award to Docomo, files evidence). The application seeks to set aside the court's 25 July ex-parte order that granted NTT Docomo Inc leave to enforce the LCIA arbitrage award dated 22 June.
Tata Sons' evidence outlines the grounds on which enforcement of the award will be resisted by Tata Sons, the statement said.
These include that Docomo has not validly tendered its shares in Tata Teleservices Limited to Tata Sons, which is a necessary condition precedent to payment by Tata of the sum awarded by the arbitral tribunal; and secondly, that performance of the award without approval by the Reserve Bank of India would be illegal under Indian law and/or contrary to public policy.
Tata Sons also clarified that, by pursuing the application before the English High Court, it was following the path laid down by the arbitral tribunal in the award.