Sibal asks Law Minister to get ready for legal battle with Sistema

Thomas K. Thomas
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Kapil Sibal, Minister for IT and Communications - Ramesh Sharma
Kapil Sibal, Minister for IT and Communications - Ramesh Sharma

Communications and IT Minister Kapil Sibal has asked the Law Ministry to be ready to fight a legal battle with Russia’s Sistema over telecom licence cancellation.

In a communication to the newly appointed Law Minister Ashwani Kumar, the Telecom Minister said that Sistema could seek legal arbitration for which the Government has to be prepared.

Sistema had earlier sent a legal notice on the Government invoking bilateral investment treaty signed between India and Russia. The company had set a deadline of August 28 for resolving the dispute which had arisen after the Supreme Court cancelled its licences along with other players who had got their permits on January 10, 2008.

“Sistema JSFC, Russia may seek arbitration, hence it is important to take all requisite necessary measures like appointment of arbitrator, finalisation of legal team, firming up the stand of the Government for any eventuality,” Sibal said in his letter to the Law Minister, adding that a panel of arbitrators must be appointed at the earliest to present India’s case if the Russian company goes to the international court.

Sistema has already filed a curative petition with the Supreme Court seeking a review of the decision to cancel its licences on grounds that its case was different from the other players that got their licences in 2008.

While the Department of Telecom has indicated that it will back Sistema’s petition, the final decision will come from the court. Sistema has also threatened to exit India if its investments are not protected.


(This article was published in the Business Line print edition dated November 2, 2012)
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