On 2nd of February this year, the Supreme Court of India announced a historic decision cancelling 122 Telecom Licenses affecting at most 8 companies (2 of them have already decided to QUIT India), several crores of investment made by such companies along with direct & indirect impact on employment of several individuals across India.
Among the 8 companies, 2 Companies (Foriegn Parnters) has already decided to leave India, Idea & Tata Docomo CDMA would for sure return back to the industry, Videocon & Loop Mobile has very negligible presence across India and the last 2, MTS & Uninor, are determined to stay in India. They are the only companies that look serious, have invested thousands of crores in network etc. & are ready to sit again in auction and stay here in India.
Today, Sistema JSFC, the majority shareholder in MTS India has send official notice to Indian Government to settle the dispute relating to its license revocation within a period of 6 months i.e. till 28th August, 2012. The notice has been sent under Bilateral Investment Treaty (BIT) signed between the Government of the Russian Federation and the Government of India for the Promotion and Mutual Protection of Investments dated 23 December 1994 which came into force on 5 August 1996.
As per the Article 9.1 of the BIT provides an Investor from one Contracting Party and the other Contracting Party with an opportunity to amicably resolve a dispute arising in relation to investments made by the Investor in the territory of the State of the other Contracting Party. The procedures for the amicable resolution of such disputes include conciliation procedures under the Conciliation Rules of the United Nations Commission on International Trade Law. As per the the Bilateral Investment Treaty, it the duty of Government of India to promote and protect foreign investments, including treating the investments in a fair and equitable way, providing them full protection and security, and not expropriating the investments.
The official letter has been sent to Ministry of External Affairs, Ministry of Finance and Ministry of Communication and Information Technology of Government of India & also to the Indian Embassy in Moscow.
If the whole issue is not resolved within the time frame of 6 months, Sistema can take India to the United Nations Commission on International Trade Law (UNCITRAL) and/or any other forum to get the issue resolved.
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