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Vodafone Group agrees to consolidate its two international arbitration cases against India

Tuesday, 09 January 2018

Vodafone Group has agreed to the consolidation of its two ongoing international arbitrations against India, provided India agrees to it as well.

Since the Supreme Court has allowed the appointment of a presiding arbitrator in the second arbitration under the India-United Kingdom Bilateral Investment Protection Agreement (BIPA), the central government cannot oppose the proceedings.

Vodafone will request the second tribunal to consolidate the two proceedings should India have no objections. According to the company, the two proceedings under the different BIPAs were an abuse of the process of law. Further, according to the company’s defence, Indian courts do not have the jurisdiction to stop the arbitration proceedings being conducted under international law.

Vodafone has initiated two separate arbitration proceedings against India, one under the India-United Kingdom BIPA and another under India-Netherlands BIPA. This is in connection with the tax demand raised by the government related to its $11 billion stake acquisition of Hutchison Telecom in 2009.As per the government, the Hutchison-Vodafone deal was liable for tax deduction at source under the Income Tax Act. Therefore, the government raised the demand of Rs 110 billion which has risen to roughly Rs 200 billion over the years due to interest and penalties.

 

 
 

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