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Members questioned the e-commerce major about its revenue mode, how much revenue it generates and what per cent of it Amazon reinvests in India. The panel also asked questions about how much tax it pays in India, sources in the committee said.
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On Wednesday, members from Amazon India's legal and policy teams were present at the meeting and shared recommendations for the Personal Data Protection Bill.
While Amazon India and Amazon Web Services were called together, they made separate presentations, as per the sources cited above.
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Google and Paytm are scheduled to appear before the panel on October 29.
The panel has also issued summons to telecom giants Reliance Jio and Airtel, smartphone application firm Truecaller, and cab aggregators Ola and Uber.
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The Joint Committee of Parliament on the Data Protection Bill sought an affidavit from Twitter Inc, the U.S.-based parent company of the social media platform, asking them to explain why it had shown Ladakh as a part of China, a senior member of the panel said on Wednesday.
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Twitter representatives on Thursday verbally apologised for geo-tagging Leh, the capital city of the Union Territory of Ladakh, as part of China while appearing before the Joint Parliamentary Committee on Personal Data Protection Bill, 2019. The committee, however, has asked the microblogging site to follow it up with a written apology and also submit an affidavit in the matter.
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Eight absolutely unknown facts are emerging in the Bezos vs Ambani battle.
Updated : October 27, 2020 10:08 AM IST
Src
https://www.cnbctv18.com/retail/in-b...on-7310031.htm
1. Has Amazon's Jeff Bezos disclosed all of the Amazon-Future agreements to Future Retail Ltd (FRL) shareholders?
To this, corporate watchers say no. Bezos has invested 49 percent in Future Coupons Ltd (FCL), a promoter company of FRL. 51 percent of FCL is held by Kishore Biyani, an Indian resident. FCL, in turn, has 9.82 percent holding in FRL.
It looks as though that FCL is controlled by Biyani with his holding of 51 per cent. This is a requirement under India's FDI Regulations.
Bezos cannot hold directly even one share in FRL. On the face of it, he seems to be in compliance with FDI Regulations. But, the reality is different.
(i) Tier 1 is a shareholders' agreement between FRL, FCL and other promoters of FRL – in terms of this agreement, without FCL's consent, FRL cannot transfer its assets or business to any third party and its board cannot even consider such a proposal.
(ii) Tier 2 is a shareholders' agreement between FCL, Amazon and other promoters of FRL – in terms of this agreement, Bezos has taken over the rights of FCL under the FRL shareholders' agreement.
(iii) Thus, effectively Bezos controls FRL.
The Future Retail shareholders agreement and the Future Coupons shareholders agreement have never been disclosed to any Indian regulator.
If they are disclosed:
(i) SEBI will find that Bezos has taken control of FRL and will mandate him to make an open offer at a price of Rs 500 per share.
(ii) ED will find that Bezos has invested in and taken control of a multi-brand retail company without Government approval and hoodwinked the Government of India.
2. Has FRL amended its Articles?
Amazon's rights in FCL were carried as part of the amendment to the Articles of FCL.
FRL Articles have not been amended. This is because, had the amendment been proposed to the shareholders disclosing that Amazon will exercise the rights of FCL under FRL shareholders' agreement, the public shareholders would have never approved it.
3. Amazon could not have invested in FRL through FDI route under FDI Policy. Then, how does it have enforceable rights against FRL?
For this, Amazon has gone through the above mired (and convoluted) structure;
FRL is engaged in Multi Brand Retail Trade (MBRT); Foreign Direct Investment (FDI) - up to 51 percent - in MBRT is allowed only with prior permission of the government, which will also be subject to veracious conditions, including sourcing of materials within India and management control etc.;
Amazon wants to control multi brand retail space, but without any of the legal hassles; therefore, in a convoluted manner, it went ahead with the mired illegal structure; if the veil is pierced and the transaction structure is studied in detail, it will be found illegal, corporate watchers said.
The fact that Amazon has obtained an interim order from the Emergency Arbitrator injuncting the public company, FRL not to proceed with the scheme, inspite of not having any direct shareholding in FRL, shows that the contractual rights are nothing but "control", in violation of SEBI and FDI Regulations.
Bezos is learnt to have followed a similar investment structure while investing in More Retail; where he invested Rs 4,200 crore;
For FDI violations, the consequence is, apart from annulment of transactions, Bezos is exposed to penalty of up to three times the investment – ~Rs 5,630 crore x 3 times = Rs 16,890 crore, sources said.
For violation of SEBI Takeover Regulations, apart from penalty, they may also be liable to be prosecuted.
4. How as a foreign company Amazon asserted control over FRL and its Board? And on FRL shareholders?
The assertion shows that Amazon has violated FDI and SEBI Regulations. If Amazon asserts control, it needs to make an open offer.
5. Amazon is asserting control over FRL. Does it violate FDI policy?
Yes.
6. Have all of the agreements been disclosed to regulators – SEBI, ED, etc.?
No – details of transaction selectively provided – in an obfuscated manner
Enforcement Directorate, SEBI, Ministry of Company Affairs, and other authorities etc, must direct Amazon to disclose the agreements and details of actual arrangements in and commence inquiry.
7. What is the crux of the SIAC'd Interim Order?
It records that Amazon's entire investment was for its direct interests in FRL.
8. Is Mukesh Ambani a competitor of Bezos?
Bezos cannot carry on multi brand retail in India. He can carry on only market-place e-commerce in India. Yet, his Amazon is referring to Ambani's Reliance as its competitor. Reliance can be Amazon's competitor only if the latter is permitted to do MBRT.
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Amazon Arbitration: Four options available for Kishore Biyani’s Future
Updated : October 28, 2020 09:11 PM IST
Src
https://www.cnbctv18.com/legal/amazo...re-7321961.htm
The Future group, with its back against the wall and with the clock ticking on the Rs 24,700 crore deal, may be wary of waiting for the Arbitral Tribunal.
If the Future Group chooses to not wait for the Arbitral Tribunal, it can contest the applicability and enforceability of the interim directions in an Indian High Court.
Given the lack of recognition and enforcement of an emergency arbitrator’s directions, Future Group could simply proceed with the said transaction, while considering an appeal when the Arbitral Panel is finally constituted