Economic Times | Mar 28, 2012
2G: Telenor plans to invoke India-Singapore treaty
NEW DELHI: Norway’s Telenor will seek ’compensation for all investment, guarantees and damages’ if the Indian government fails to sort out issues related to its licence cancellation within the next six months, the company said.
The Scandinavian telecom major, whose Indian operations were among the worst affected after the Supreme Court last month cancelled 122 mobile permits issued in 2008, said it had invoked the bilateral pact - the India-Singapore Comprehensive Economic Cooperation Agreement (CECA) - to protect its investments here.
Telenor now follows Russian conglomerate Sistema that has already issued a notice to the Indian government threatening international arbitration if the latter failed to resolve within six months the fallout due apex court’s orders cancelling its mobile permits.
"We can confirm that we have informed the government of India of our intent to invoke the provisions of the CECA between India and Singapore. While we haven’t stated any amount, we do intend to seek compensation for all investment, guarantees and damages. We are hopeful that it remains the government’s intent to protect and encourage bona fide foreign investment in the country," the Telenor spokesperson said.
Corporate Affairs Minister M Veerappa Moily told reporters that he had ’not seen’ Telenor’s notice and added that the government would ’examine it legally within the parameters of (his) ministry’. "There is a thing like a rule of law. Whether you go to international law-...but we will have to examine within the parameters of our law and the law of the land," Moily added.
The Norwegian telco’s spokesperson also clarified that after sending a notice on invoking the treaty, the company was ’required to allow a period of six months to resolve the issue’. "Only if the matter is not suitably resolved within this period can it proceed with actions as per the treaty," the telco said.
"We are convinced that we can resolve this matter through continuing dialogue with the government such that Telenor Group remains a serious and long-term participant in the Indian market that brings the benefit of competition to the Indian consumers," the telco added in reply to an ET query.
Under this Bilateral Investment Treaty (BIT), the company can approach the United Nations Commission on International Trade Law or the World Bank-affiliated International Centre for Settlement of Investment Dispute for legal redressal to safeguard its investments.