Amazon asks Future to withdraw CCI complaint on FEMA vioation
- ByStartupStory | November 23, 2021
US giant Amazon asked Kishore Biyani-led Future Groups to withdraw its complaint before the CCI as the two tries to find a solution with regards to the bitter confrontation they had over investments. An out-of-court settlement has been hinted by Amazon which suggests to end the tussle by asking Future Group to withdraw its complaint filed against Amazon over alleged violation of (FEMA) rules before CCI. Apparently, Amazon, who is contesting the deal between Reliance Retail and Future Group is looking to exit if compensated.
Earlier, The independent directors of Future Retail Ltd.(FRL) accused Amazon of giving “completely opposite information contradictory” to Amazon’s own assurance about its investments into FRL’s promoter company in 2019. Amazon after finalising a deal on December 11, 2018 to acquire 9.9% direct stake in FRL learned that the government of India prohibits a foreign entity from acquiring any stake in retail entity in India.
This prompted Amazon to acquire 49 percent stake in FCPL(Future Coupons Pvt Ltd.) who held a 9.82% stake in FRL. In August of 2020, when Reliance Retails announced its acquisition of the retail, wholesale, logistics and warehousing business of Future Groups, for a Rs24,714 deal, Amazon contested the deal in both Indian courts and Singapore-based arbitration centre.
In October, 2020, an interim award was passed by (SIAC) in favour of Amazon that barred FRL from selling its assets to a restricted party. Since then, this tussle has been ongoing with both FRL and Amazon negotiating for a mutual solution.
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