NTT DoCoMo offers to suspend legal action if Tata backs enforcement plea

Japanese telecom major NTT DoCoMo has told its joint venture partner Tata Sons that it is willing to put in abeyance all its legal actions in international courts, for a few months, if the Indian company supported its appeal to enforce the $1.17-billion arbitration award in the Delhi High Court.

“NTT DoCoMo has offered to suspend all international actions for at least two months if Tata DoCoMo supports its plea in the Delhi High Court,” said a source close to the Japanese major.

Tata Sons had also offered a compromise formula under which the entire dispute would be submitted to the decree of the Delhi High Court. In return, Tata Sons had asked NTT DoCoMo to withdraw all legal action in other countries.

This has, however, not been agreed to by the Japanese major which continues to pursue the case in international courts.

Explaining as to why this was rejected by the Japanese major, the source said that complete withdrawal would not have been acceptable to any company in this kind of dispute as that would have led to a situation where NTT DoCoMo had no back-up plan in case the Tatas changed their stand later. “Withdrawal of all international action would have exposed NTT DoCoMo therefore they suggested suspending all action, including in London, as an alternative,” said the source.

However, sources advising Tata Sons said that mere suspension of legal action would not be acceptable. “The basic question is whether the arbitration award is per Indian laws or not. Tata Sons believe that it is not. DoCoMo wanted the Tatas to take a view which would have gone against Indian laws,” said the source close to the Tata camp.

They added that instead of pursuing legal action, the Japanese company should have given a chance for talks. “What was the hurry on NTT DoCoMo’s part to file the case in the Delhi High Court? They could have talked to the Tata Group to see if this can be resolved without legal action,” the source said.

According to one of the sources advising Tata Sons, the Indian company was forced to file an appeal to block the enforcement of the $1.17 billion awarded by a London court only after NTT DoCoMo rejected the proposal to submit to the final decree of the Delhi High Court.

Last week, Tata Sons had filed an appeal with the Delhi High Court asking it to dismiss NTT DoCoMo’s plea to enforce the $1.17-billion penalty awarded by the London Court of International Arbitration (LCIA).

NTT DoCoMo had earlier questioned the intent of Tata Sons. “The fact that Tata has raised objections to the enforcement of the London Court of Arbitration award directly contradicts its statements of intent to meet its payment obligations. The award by the LCIA is internationally recognised, including by India, and there is no reason to delay,” the Japanese firm had said in an earlier statement.

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