Telecom giant Vodafone, Russian conglomerate Sistema and UK's TCI have slapped notices on the government for violation of bilateral investment protection treaties India had signed with various nations, Parliament was informed today.
"The notices are handled under the provisions of the applicable Bilateral Investment Promotion and Protection Agreements (BIPAs) including through negotiations with the foreign investors for an amicable settlement of the issues," Minister of State for Commerce and Industry Jyotiraditya Scindia said in a written reply to the Rajya Sabha.
He said besides these firms, the government has received notices Devas Employees Mauritius Pvt Ltd and The Children's Investment Fund Management (TCI).
While Scindia did not give details of the issues on which notices were served, Vodafone may have slapped the notice over the tax demand note it got for its buyout of Hutchison's stake.
Sistema, whose 22 telecom licenses were among the 122 permits that Supreme Court in February cancelled, may have filed the notice to protect its telecom business in the country.
TCI, the largest foreign investor in Coal India Ltd, has alleged that the government firm was not protecting minority shareholders’ interest and harming the company by not opposing fuel supply pacts with power companies.
Sistema Joint Stock Financial Corporation has served the notice under BIPA with Russia, Children's Investment Fund Management (BIPA with UK), Vodafone International Holdings (BIPA with Netherlands) and Devas Employees (BIPA with Mauritius).
The objective of BIPAs is to provide fair and equitable treatment to the investors of either country in the territory of other nation.
Such agreements increase the comfort level of the investors by assuring a minimum standard of treatment in all matters and provides for justifiability of disputes with the host country.
India has so far signed BIPAs with 82 countries out of which 72, including that of with Russia, Germany, UK and Netherlands have already come into force and the remaining agreements are in the process of being enforced.