Delhi High Court Judgement On BITS Arbitration

Introduction

In a well-reasoned judgement, the Delhi High Court, has whilst dismissing the Government of India's (GOI) application for an anti-arbitration injunction against Vodafone PLC, provided welcome judicial guidance on the approach of Indian courts to Bilateral Investment Protection Agreements.

The present controversy arose out of the long running feud between Vodafone and GOI on retrospective taxation of capital gains on a transfer of shares when Hutchinson's Indian telecom business was sold to Vodafone.

Vodafone initially invoked arbitration against GOI under the Indo-Netherlands BIPA. Upon GOI raising a jurisdictional objection to this arbitration, Vodafone subsequently commenced arbitration under the Indo-UK BIPA.