What should be an ordinary commercial dispute between Amazon.com Inc. and the founders of a near-bankrupt retailer is shining a harsh light on the quality of legal and regulatory protection investors actually receive in India.
The long drawn-out saga has thrown up two questions for prospective investors, or those who already have business interests in India. First, what does a go-ahead from the country’s antitrust authority even mean if an entire chain of investment based on that approval has to be unwound or reversed after two years? Second, can one rely on international arbitration to enforce Indian contracts, or will local courts get involved and throw a spanner into alternative dispute-resolution mechanisms?
Last month, Amazon was fined 2.02 billion rupees ($26.7 million)