Khaitan Holdings (Mauritius), or KHML, the foreign investor in Loop Telecom whose 21 licences were cancelled by the Supreme Court as part of its action against 122 2G permits in February 2012, has dragged the government into international arbitration, seeking damages to the tune of $1.5 billion for recovering its lost investment.
Although other foreign investors such as Norway's Telenor and Russia's Sistema had threatened to invoke provisions of the bilateral investment treaties to seek arbitration, they refrained from going ahead as they won licences during subsequent auctions.
KHML, which holds 26.9% in Loop that currently runs operations in Mumbai, invoked the international arbitration under a June 2000 agreement signed between Mauritius and India for the Promotion and Protection of Investments. It said that the Supreme Court had cancelled the licences after finding the department of telecom's (DoT) tendering policy as "seriously flawed and legally untenable" and being "inherently arbitrary".
Although other foreign investors such as Norway's Telenor and Russia's Sistema had threatened to invoke provisions of the bilateral investment treaties to seek arbitration, they refrained from going ahead as they won licences during subsequent auctions.
KHML, which holds 26.9% in Loop that currently runs operations in Mumbai, invoked the international arbitration under a June 2000 agreement signed between Mauritius and India for the Promotion and Protection of Investments. It said that the Supreme Court had cancelled the licences after finding the department of telecom's (DoT) tendering policy as "seriously flawed and legally untenable" and being "inherently arbitrary".
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