Sistema asks India to settle telecom row in 6 mths

NEW DELHI Tue Feb 28, 2012 7:08pm IST

The sun rises behind a communications tower in New Delhi March 20, 2006. REUTERS/B Mathur

The sun rises behind a communications tower in New Delhi March 20, 2006.

Credit: Reuters/B Mathur

Related Topics

Stocks

   

NEW DELHI (Reuters) - Russia's Sistema asked India to settle within six months a dispute over a court order to revoke 21 telecoms licences held by its joint venture in the country, and said it reserves the right to approach an international tribunal.

Sistema Shyam TeleServices Ltd (SSTL), majority owned by Sistema, is set to lose all but one of its telecoms permits after an order by Supreme Court earlier this month to revoke in four months a total 122 licences awarded under a scandal-tainted 2008 sale.

"Sistema believes that the cancellation of SSTL's licenses following Sistema's investment of billions of dollars into the Indian cellular sector is contrary to India's obligations" under a bilateral investment treaty between India and Russia, the oil-to-telecoms conglomerate said in a statement on Tuesday.

Sistema said it sent a "formal notice" on Tuesday through its legal counsel to India's finance, foreign and telecoms ministries to settle the dispute in an "amicable way" by August 28.

"Sistema believes it has a strong case and reserves the right to commence proceedings against India before an international arbitration tribunal...if the dispute is not settled amicably within the deadline," it said.

Sistema owns 56.68 percent of the mobile phone carrier, which is ranked ninth in India's 15-player mobile phone market. It had 15 million customers as of end-December. Shyam Group and the Russian government are the other key shareholders.

Sistema Shyam TeleServices also plans to separately contest the Supreme Court order and will file a petition this week, seeking a review of the order, the carrier's Chief Executive Vsevolod Rozanov said in the statement.

The licence cancellation order affects eight companies totally, including Norway's Telenor (TEL.OL) and Abu Dhabi's Etisalat ETEL.AD.

The companies losing their licences have the option to bid and win back the licences and radio airwaves in an auction, for which rules have yet to be set.

Telenor, whose majority shareholder is the Norwegian government, has said it will fight the order using legal as well as diplomatic channels.

Telenor wants to scrap its current Indian joint venture and dump its Indian partner and said it will migrate the business to a new company. It had earlier said it would consider bidding in the auction after seeing the rules and base price.

Sistema Shyam, which operates on the CDMA technology platform, plans to bid for radio airwaves in the upcoming auction.

(Reporting by Devidutta Tripathy; Editing by Aradhana Aravindan)

FILED UNDER:
  • Most Popular
  • Most Shared

DEFENCE

REUTERS SHOWCASE

Power Theft

Power Theft

India to invest $4 billion to tackle power theft  Full Article 

Debt Funds

Debt Funds

India monitors foreign flows into debt funds, may tighten rules  Full Article 

Bulgari Back in India

Bulgari Back in India

CEO: we shouldn’t have left India so we’re back  Full Article 

 Hindu "Modi-fication"

Hindu "Modi-fication"

Fears grow about Hindu "Modi-fication" of education  Full Article 

Weak Credit

Weak Credit

Hard to hit tax revenue target, credit weak - Jaitley  Full Article 

China Rate Cut

China Rate Cut

China surprises with interest rate cut to spur growth  Full Article 

Gold Imports

Gold Imports

RBI cautious on response to gold import surge  Full Article 

Economic Corridor

Economic Corridor

China commits $45.6 billion for economic corridor with Pakistan  Full Article 

Overseas Funds

Overseas Funds

RBI says overseas borrowed funds can be parked with banks in India  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage