Year: 2023

Deficiently Stamped Arbitration Agreements

Deficiently Stamped Arbitration Agreements: The Supreme Court Finally Decides

Insights | December 22, 2023 | Practice Area:

In April 2023, a five-judge bench of the Supreme Court issued a decision in N.N. Global Mercantile Private Limited v. Indo Unique Flame Limited (“NN Global 2”) which held that a deficiently stamped agreement is void, unenforceable and cannot exist in law. Further, the Supreme Court in NN Global 2 held that such an agreement must be impounded by a court called upon to appoint an arbitrator.
NN Global 2 was met with criticism as it would lead to inordinate delays in the appointment of arbitrators and the commencement of arbitration proceedings, if stamping of agreements was made a pre-condition to these actions. It also impacted the manner in which legal practitioners summarized their due diligence findings of deficiently stamped agreements.
On December 13, 2023, a seven-judge bench of the Supreme Court revisited NN Global 2 in Re Interplay between Arbitration Agreements under the Arbitration and Conciliation Act 1996 and the Indian Stamp Act 1899. This decision overruled NN Global 2, and provided much-needed clarity on the issue of admissibility and the enforceability of deficiently stamped agreements.
This note discusses the key findings of the decision of the seven-judge bench of the Supreme Court.

Clean energy

Clean Energy: Issue 3 of 2023

Quarterly Roundups | November 23, 2023 | Practice Area: , , ,

S&R Associates presents the third issue of its quarterly roundup series on clean energy. Here, we cover updates from the period between the months of July and October of 2023.
This issue comprises regulatory updates on renewable energy and electric vehicles, respectively, including central and state government notifications in this regard, along with India-related updates and international developments.
In addition, we provide an overview of carbon credits, including in respect of its market dynamics.

Innovative Constructions

Innovative Constructions: Assessing the Investment Viability of New Construction Technologies

Insights | November 20, 2023 | Practice Area: , , , , ,

Every year, Indians require 10 million new homes. At the same time, global markets are increasingly focused on sustainability, climate change and ESG-related goals. The confluence of such factors has created various opportunities to employ climate-responsive construction techniques, including through the use of eco-friendly and sustainable material. Relatedly, the interplay of energy-efficient solutions, green-certified buildings, targeted investments and financing, key legislative changes, government incentives and a coordinated regulatory framework, as well as increased digitalization, may change this ecosystem in fundamental ways.

Managing Foreign Sellers’ Risks in Indian M&A Transactions

Insights | November 14, 2023 | Practice Area: ,

In a previous note published earlier this month, certain common risks for foreign buyers in Indian M&A transactions were discussed in addition to the strategies to mitigate such risks. In this note, the most common concerns of foreign sellers in an M&A transaction have been discussed i.e., to mitigate risk of deal certainty, risk of any payment default by buyer and limitation of foreign sellers’ liability post completion of an M&A transaction. This note also discusses certain trends and market practices relevant for foreign sellers to manage such risks within the Indian legal framework.

Capital Reduction The Position of Minority Shareholders

Reliance Retail’s Capital Reduction: The Position of Minority Shareholders

Insights | November 1, 2023 | Practice Area: ,

In July 2023, Reliance Industries Limited announced that the board of directors of its indirect subsidiary, Reliance Retail Limited has approved a proposal to reduce its share capital. The proposed reduction involves canceling the shareholding of the minority shareholders of Reliance Retail, making Reliance Retail a wholly-owned subsidiary of its parent company, Reliance Retail Ventures Limited.
This capital reduction is of interest due to the trading of Reliance Retail’s equity shares on the unlisted market. While Reliance Retail’s valuation is based on reports from independent valuers, objections could arise if the minority shareholders perceive the offered consideration as lower than the price in the unlisted market.

Private Sector Participation in India’s Space Sector

Reaching for the Stars: Private Sector Participation in India’s Space Sector

Insights | October 27, 2023 | Practice Area: ,

India’s recent achievements in space exploration have garnered significant global attention (e.g., Chandrayaan-3’s soft-landing on the lunar south pole; Aditya-L1’s solar study mission; and hitting key milestones in terms of achieving manned spaceflight capabilities as part of the Gaganyaan project). However, private sector participation in space activities continues to be hamstrung through a combination of: (i) financial constraints (e.g., a lack of access to capital, including continued challenges with respect to securing asset-based financing, such as on account of the mobility of such underlying assets); along with (ii) regulatory ambiguity (e.g., in terms of attributing and quantifying liability, including in respect of third-party liability insurance, as well as with regard to corresponding caps).
Nevertheless, several new initiatives in India hold promise, such as: (i) the Indian Space Policy, 2023; (ii) a stated commitment to increase the country’s global market share, including by moving away from a demand-based model to a supply-centric approach; (iii) the ongoing and time-bound processing of private sector applications (related to space activities) by the Indian National Space Promotion and Authorization Center (IN-SPACe) – a single-window nodal agency – including for the purpose of assisting erstwhile vendors and suppliers to move up the value chain; (iv) the aggregation of user requirements by NewSpace India Limited – a Central Government-owned enterprise – including for the purpose of utilizing new space assets optimally based on determinations of stakeholder accountability, as well as creating new ones based on demand confirmations; along with (v) the launch of the SpaceTech Innovation Network (SpIN) in order to foster entrepreneurial innovation – especially in respect of startups and SMEs.
This note outlines India’s efforts to enhance and improve upon space regulation – including through reforms and liberalization – while also highlighting obstacles in both policy and practice.

India’s Digital Public Infrastructure DPDP Act

India’s Digital Public Infrastructure Could Have All the Answers to Questions Under the DPDP Act

Insights | October 23, 2023 | Practice Area: , ,

Confusion abounds among key stakeholders of India Inc. with respect to consent management and allied concerns under India’s newly published Digital Persona Data Protection Act, 2023. This is especially true in the context of age verification requirements, along with the means of obtaining verifiable parental consent for children’s data. However, India’s digital public infrastructure could provide all the right answers – eventually. This note explores and examines how.

Modifications to Schemes of Arrangement

Modifications to Schemes of Arrangement

Insights | October 5, 2023 | Practice Area: , , , ,

Once a scheme of arrangement has been approved by its shareholders or the relevant National Company Law Tribunal, what, if any, modifications are permissible to the scheme of arrangement without seeking fresh shareholder approval?

This note considers the legal framework for modifications to approved schemes of arrangement. It also examines the proposed merger of Zee Entertainment with Sony Pictures India where this question potentially arises for consideration.