Tata Sons-DoCoMo slugfest over telecom JV intensifies

Our Bureau Mumbai | Updated on January 16, 2018 Published on September 04, 2016


The negotiation between Tata Sons and NTT DoCoMo over their telecom joint venture has broken down once again with the two trading barbs at each other.

Tata Sons, on Sunday, said that it has been disappointed with the lack of co-operation from Japan’s NTT DoCoMo in arriving at an amicable resolution. The Japanese major, on the other hand, accused Tatas of delaying the penalty awarded by an international arbitration court.

Tatas defended its position stating that it is ready to pay, but within the constraints of the law.

“We have been disappointed with the lack of co-operation from our partner in arriving at an amicable resolution. Despite several attempts on our part, our partner has refused to come together with us to engage the government and the Regulator on the issue,” Tata Sons said in a statement.

On Friday, Tata Sons 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).

“The position Tata Sons has taken in its affidavit filed in the Delhi High Court is in line with what we have stated from the outset – that Tata Sons is committed to honouring our contractual obligations to NTT DoCoMo, in compliance with Indian regulations and law. There is a judicial process that is underway and we need to pay due heed to the laws that bind us all,” it said.

NTT DoCoMo said the move by Tatas to block its appeal in the court exposed its real intent. “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 said.

In response, the Tatas said that DoCoMo is unfortunately confusing its intent to pay with what is legally payable.

$1.17-b compensation

The London court had asked Tatas to pay $1.17 billion to the Japanese major as compensation. The dispute dates back to January 2015, when NTT DoCoMo moved the London Court of International Arbitration against Tata Sons for failing to find a buyer for its stake in Tata Teleservices.

In April 2014, NTT DoCoMo announced plans to sell its entire stake in TTSL, exiting India five years after entering the country. The exit came after the Indian company failed to achieve certain performance targets.

Under the terms of the shareholder agreement, Tata Sons had to find a buyer by December 2014, failing which it had to buy the DoCoMo stake. But a RBI regulation that prohibits sale of equity at a pre-determined price is coming in the way of settling this dispute.


Published on September 04, 2016
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