Days after Antrix Corporation — the Indian Space Research Organisation’s (ISRO) commercial arm — lost an international arbitration case against its former partner Devas Multimedia Ltd in the Supreme Court, Devas investors took Antrix to the Permanent Court of Arbitration in The Hague. The Court has set up a panel to hear the multi-million dollar claim slapped by Devas Multimedia and its U.S. associates (who invested in the deal through foreign direct investment routed via Mauritius) against the Government of India following the cancellation of the deal for the launch of two satellites and the allocation of S-band spectrum to Devas.
Three investor companies of Devas, namely Columbia Capital/ Devas (Mauritius) Ltd; Telecom Devas Mauritius Ltd; and Devas Employees Mauritius Private Ltd, have hauled the Government of India, as parent of Antrix and DoS, into the international arbitration citing breach of BIPA (Bilateral Investment Protection & Promotion Agreement).
The Hague arbitration panel will be chaired by Canada’s Marc Lalonde QC and will comprise Francisco Orrego of Chile and former Rajasthan High Court Chief Justice Anil Dev Singh. The three will review the damages claim brought by the Devas investor companies under the UNCITRAL (United Nations Commission on International Trade Law) Arbitration Rules which entrust the secretary general of the PCA with the role of designating an “appointing authority” upon request of a party to arbitration proceedings. This role has taken on an increasing significance in recent years.
The Mauritius-based entities are associated with U.S.-based investment funds.
The Mauritius-based firms filed for arbitration last July under the Mauritius-India Bilateral Investment Treaty following the cancellation of the 2005 contract by Antrix Corporation.
Clemmie Spalton, reporting in the Global Arbitration Review, wrote: “The contract had provided for the launch of two satellites allowing Devas to establish a hybrid satellite and terrestrial communications network to supply wireless audio-visual, broadband and mobile internet service across India. Antrix justified the termination of the contract by claiming that Indian policy had changed and that the allocation of S-band Spectrum to companies unconnected with India’s space programme was now regarded as a risk to national security. This change in policy constituted a “force majeure” event, the company argued.” But this argument has been countered by Devas which contends that the national security and force majeure issues are “contrived excuses.”
The Hague arbitration panel will be chaired by Canada’s Marc Lalonde QC and will comprise Francisco Orrego of Chile and former Rajasthan High Court Chief Justice Anil Dev Singh