Deutsche Telekom AG v The Republic of India

• Jurisdiction: Singapore
• Judge: S Mohan J
• Judgment Date: 30 January 2023
• Neutral Citation: [2023] SGHC(I) 7
• Court: International Commercial Court (Singapore)
• Docket Number: Originating Summons No 8 of 2022 (HC/Summonses Nos 155 and 720 of 2022 and SIC/Summonses Nos 24 and 45 of 2022)
• Hearing Date: 12 August 2022,01 July 2022,30 June 2022
• Citation: [2023] SGHC(I) 7
• Year: 2023
• Plaintiff Counsel: Koh Swee Yen SC, Quek Yi Zhi Joel, Axl Rizqy and Andrea Seet Sze Yuen (WongPartnership LLP)
• Defendant Counsel: Cavinder Bull SC, Lin Shumin, Lee Zhe Xu and Sam Yi Ting (Drew & Napier LLC)
• Published date: 11 May 2023

Anselmo Reyes IJ (delivering the judgment of the court): Introduction

The plaintiff investor (“DT”) is a multinational corporation incorporated under the laws of the Federal Republic of Germany. Through its wholly-owned subsidiary, Deutsche Telekom Asia Pte Ltd (“DT Asia”), it was a shareholder in an Indian company, Devas Multimedia Private Limited (“Devas”).

The defendant State (“India”) is the Republic of India and was the respondent in the relevant arbitration proceedings that took place as detailed below between the plaintiff and the defendant (the “Arbitration”).

A key player in the dispute between DT and India is Antrix Corporation Ltd (“Antrix”), an Indian state-owned entity. Antrix is the commercial arm of the Indian Space Research Organisation (“ISRO”) and administratively controlled by India’s Department of Space (“DOS”).¹

The Arbitration arose out of India’s annulment of an agreement dated 28 January 2005 (the “Devas-Antrix Agreement”) between Devas and Antrix for the lease to Devas of S-Band electromagnetic spectrum on two satellites to be manufactured and launched by the ISRO.² The Devas-Antrix Agreement contemplated (among others) the offering of mobile multimedia and information services to the Indian market via a hybrid satellite-terrestrial communications platform.³

DT commenced the Arbitration in Switzerland and obtained an Interim Award (the “Interim Award”) on 13 December 2017 (dealing with jurisdiction and liability) and a Final Award (the “Final Award”) on 27 May 2020 (dealing with quantum) in its favour. DT sought to enforce the Final Award in Singapore and was granted leave to do so on 3 September 2021. India opposes the Singapore enforcement proceedings. India has also since applied for the Federal Supreme Court of Switzerland (the “Swiss Federal Supreme Court”) to review its decision to refuse to set aside the Interim Award. India contends that the Singapore court should stay DT’s enforcement proceedings pending the Swiss Federal Supreme Court’s decision on India’s revision application (the “Swiss Revision Application”). Alternatively, India says that the Singapore court should not recognise or enforce the Final Award. There are consequently four applications before us: HC/SUM 155/2022 (“SUM 155”) which is India’s application to set aside the order of the General Division of the High Court of Singapore dated 3 September 2021 (the “Leave Order”) granting leave to enforce the Final Award. HC/SUM 720/2022 (“SUM 720”) which is DT’s application to strike out parts of India’s affidavit evidence in SUM 155. SIC/SUM 24/2022 (“SUM 24”) which is India’s application to stay SUM 155 and SUM 720 pending the determination of the Swiss Revision Application. SIC/SUM 45/2022 (“SUM 45”) which is India’s application for leave to adduce further evidence in support of SUM 24.

Background The arbitration generally

On 10 July 1995, India and Germany entered into a bilateral investment treaty entitled the Agreement between the Federal Republic of Germany and the Republic of India for the Promotion and Protection of Investments (the “BIT”).⁴

DT commenced the Arbitration against India on 2 September 2013, claiming that India’s annulment of the Devas-Antrix Agreement violated the BIT.⁵ The Arbitration was governed by the United Nations Commission on International Trade Law (“UNCITRAL”) Arbitration Rules 1976 and seated in Geneva. On 22 May 2014, a tribunal comprising Prof Gabrielle Kaufmann-Kohler, Mr Daniel M Price and Prof Brigitte Stern (the “Tribunal”) issued Procedural Order No 1 in the Arbitration, which bifurcated the Arbitration into an initial phase on jurisdiction and liability followed by a second phase on damages.⁶ The hearing of the first phase took place between 6 April 2016 and 11 April 2016.⁷

On 24 October 2016, India wrote to the Tribunal, enclosing a Charge Sheet dated 11 August 2016 (the “CBI Charge Sheet”) issued by India’s Central Bureau of Investigation (the “CBI”), and a Complaint dated 31 May 2016 (the “FEMA Complaint”) filed by the Directorate of Enforcement in India’s Ministry of Finance (“ED”) under section 16(3) of India’s Foreign Exchange Management Act, 1999 (“FEMA”).⁸ The CBI brought criminal charges against several government officials, Devas, and certain Devas officers, as reflected in the CBI Charge Sheet.⁹ India claimed that the CBI Charge Sheet showed that DT’s investment had not been in accordance with Indian law. India accordingly sought to suspend the Arbitration pending the resolution of those charges.

On 14 November 2016, DT emailed the Tribunal stating that it was too late for India to: (a) object to jurisdiction or admissibility based on the CBI Charge Sheet, (b) seek a suspension of the Arbitration pending resolution of the criminal charges in the CBI Charge Sheet, and (c) introduce new evidence in the form of the CBI Charge Sheet and the FEMA Complaint.¹⁰ DT observed that “India has had knowledge of the key allegations contained in the CBI Charge Sheet for years” and the “alleged facts underlying the accusations in the CBI Charge Sheet are already contained in the evidence before th[e] Tribunal”.¹¹

On 20 February 2017, the Tribunal refused India’s application to suspend the Arbitration and deferred its determination on India’s submissions in relation to the CBI Charge Sheet to its forthcoming award on jurisdiction and liability.¹²

On 13 December 2017, the Tribunal issued its Interim Award on jurisdiction and liability.¹³ The Tribunal dismissed India’s objections to jurisdiction and found India liable for breach of India’s fair and equitable treatment (“FET”) obligation under the BIT. India’s submissions on the CBI Charge Sheet were also addressed in the Interim Award (see [159] below). The Tribunal then proceeded to the quantum phase of the Arbitration.

India applied to the Swiss Federal Supreme Court to set aside the Interim Award on 29 January 2018. India’s grounds were that: (a) the Tribunal lacked jurisdiction because DT’s investment had been indirectly made through DT Asia, (b) in refusing India’s request to admit the travaux préparatoires of the 1995 India-Netherlands bilateral investment treaty (the “India-Netherlands BIT”) into evidence, the Tribunal had denied India a reasonable opportunity to present its case, (c) the Tribunal lacked jurisdiction to rule on DT’s claims since DT had not made an investment in India but had merely engaged in pre-investment activities which are not protected by the BIT, (d) the Tribunal lacked jurisdiction as the challenged measures were necessary to protect India’s “essential security interests” and thus fell outside the Tribunal’s subject-matter jurisdiction under the BIT, and (e) the Tribunal lacked jurisdiction as the Devas-Antrix Agreement was contrary to Indian law and DT’s investment being based on that agreement was therefore likewise tainted by illegality.¹⁴

On 11 December 2018, the Swiss Federal Supreme Court rejected India’s application to set aside the Interim Award. It held that: (a) the fact that DT’s investment had been made through DT Asia did not mean that the Tribunal lacked jurisdiction, (b) the Tribunal was entitled to refuse India’s application to introduce the travaux préparatoires of the India-Netherlands BIT, (c) the Tribunal had correctly concluded that the BIT did not contain what India described as an “admission clause” capable of depriving pre-investment activities of substantive protection and, in any event, that DT’s investment was not simply pre-investment activity, (d) India was precluded from raising the issue of essential security interests, and (e) India was precluded from arguing that DT’s investment was purportedly unlawful on the basis of the illegality of the Devas-Antrix Agreement.¹⁵

Following India’s failure to set aside the Interim Award, the Arbitration’s quantum phase took place between 29 April 2019 and 3 May 2019. The Tribunal rendered its Final Award on 27 May 2020. In the Final Award, the Tribunal ordered that:¹⁶ (a) [India] shall pay to [DT] the amount of USD 93.3 million, together with interest on such amount at a rate of 6-month USD LIBOR (or any other comparable rate in case LIBOR were to be discontinued in the future) plus 2% p.a., compounded semi-annually, from 17 February 2011 until payment in full; (b) The costs of [the Arbitration] are fixed at EUR 1,460,544.64; (c) [India] shall pay to [DT] the amounts of EUR 730,272.32 as reimbursement of the costs of the arbitration, as well as GBP 5,250,011.70 and EUR 33,977.00 and USD 10,000.00 as reimbursement of part of [DT’s] legal fees and other expenses, together with interest on such amounts at a rate of 6-month USD LIBOR (or any other comparable rate in case LIBOR were to be discontinued in the future) plus 2% p.a., compounded semi-annually, starting to run 30 days after the date of the Final Award until payment in full; (d) Except as stated in subparagraph (c) above, each party shall bear the legal fees and other expenses which it incurred in connection with [the Arbitration]; (e) The Tribunal takes note of [DT’s] undertaking that it does not seek double recovery in relation to its investment, and will take appropriate steps to ensure that it is not compensated twice in the event that any damages were to be paid by [Antrix] to [Devas] pursuant to the ICC Award; and (f) All other claims and requests are dismissed. For context, the ICC Award named in subparagraph (e) refers to a Final Award dated 14 September 2015 that was issued in related arbitral proceedings.¹⁷ Those proceedings had been commenced by Devas against Antrix in or around June/July 2011, for breaches of the Devas-Antrix Agreement (see [31] below).

The Civil Court of Geneva certified that the Final Award was enforceable and declared the Final Award to be legally binding on 20 August 2020.¹⁸ Thereafter, DT commenced enforcement proceedings in the United States (“US”) and...