By Aditya Kalra

NEW DELHI, (Reuters) – For over a year Amazon.com Inc (NASDAQ) and India’s Future Group have been in a complicated legal dispute that has stalled Future’s sale of assets worth $3.4 billion to rival Reliance Industries in the U.S.

The dispute is key to who wins in one the most rapidly-growing retail sectors of the globe.

What TRIGGERED THE DISASTER?

After investing $200 million by the United States in an Indian gift voucher company, Future and Amazon became business partners in 2019.

Amazon claims that the deal contained non-compete clauses which prohibited Future’s sale of retail assets to rivals such as Reliance owned by Mukesh Ambani, one India’s most wealthy men. Additionally, the deal included provisions for the resolution of all disputes in accordance with rules established by Singapore International Arbitration Centre.

Future was hit very hard by COVID-19 and decided in 2020 to sell assets.

Amazon approached Singapore’s arbitrators to stop the sale. The parties also filed lawsuits against each other in Indian courts (including the Supreme Court) since New Delhi is still the seat of arbitration and Indian law rules the proceedings.

What does AMAZON and the FUTURE SAY about YOU?

Amazon claims that it has signed several agreements with Future in 2019, giving it exclusive rights over Future’s retail assets. Some of these it also hopes to eventually own, should India relax its rules regarding foreign investors. American company Future-Reliance claims that the potential Future deal would “destroy” this prospect.

Future says Amazon is unlawfully trying to take control of Future’s retail business. Future strongly denies that it did anything wrong. Future Retail, the flagship retail unit of the group, says it is at risk and that its 27,000+ employees could lose their jobs if the Reliance deal falls through.

WHAT IS THE BIGGEST PICTURE?

Reliance has a stake in whether Amazon is able to be more dominant in a $900billion retail market with 1.3 billion customers.

Future is home to more than 1,500 stores, and Conglomerate Reliance operates 1,100 of them. Both companies are growing rapidly into e-commerce. The Future deal will boost Reliance’s retail footprint immediately, and has attracted a number of prominent foreign investors.

Amazon invested $6.5 Billion in India to boost its e-commerce business. Amazon was already able to expand its online delivery service by using the Future partnership. It also integrated Indian companies’ stores into its site.

Amazon’s plans to counter billionaire Ambani’s growth strategies are reflected by “Keeping Future from Reliance”. Amazon claimed that Reliance and Future’s combined position “will further limit competition in India’s retail market.”

HOW DID INDIA’S ANTITRUST AGENCY COME INVOLVED IN THIS STORY?

Future complained about India’s antitrust body, the Competition Commission of India (“CCI”) that Amazon made contradictory and inaccurate submissions concerning the intended purpose of the 2019 agreement.

Amazon claimed it did not conceal any information. However, the CCI suspended approval for the Future 2019 agreement last December, claiming that Amazon had “deliberately suppressed the true scope of the deal” and its interests in Future’s businesses.

Amazon claims the CCI exceeded its power, but Future says the U.S. company has no right to make any claim as the 2019 deal is not yet approved by regulatory authorities.

This was a blow for the U.S. company, as the Delhi High Court halted Singapore arbitration proceedings due to Indian antitrust decisions.

Amazon, however, has appealed against the Indian court decisions that put the arbitration on hold.