Analysing cross-border deals post Covid-19 pandemic - The Daily Guardian
Connect with us

Legally Speaking

Analysing cross-border deals post Covid-19 pandemic

Ajay Bhargava & Shivank Diddi



Cross-border deals have been an important driver of a corporate expansion strategy, but now more than ever, they could take center-stage as the new economic powers of the world consolidate their positions. Cross-border transactions have seen underlying growth for the past two decades despite economic cycles and this looks set to continue and increase even more. With a surplus of capital searching for a home, investors are increasingly finding deals in countries beyond the usual choices in North America and Europe, and are looking to Africa, Asia and other frontier markets.

The types of cross-border deals vary, but the most common ones are Joint Ventures, Licensing, Mergers and Acquisitions, Employee and Immigration issues, Financing and Investments, Leasing, Distribution, Share offerings, Franchising, Outsourcing, Restructuring, setting up an overseas branch/entity.

Business fundamentals drive investment cases, but deal making depends on softer factors: people, connections, collaboration, sentiment and confidence. All of these factors have been altered by COVID-19 and the lockdown and restrictions imposed in various jurisdictions. COVID-19 has caused fundamental changes to working practices in most industries, and one of the most significant is in technology and the shift to virtual working.

Cross border transactions are complex and considered hugely challenging by organizations. The legal risk is higher in cross border deals than in domestic deals. The challenges are many and varied, but led by compliance risk. The risk and complexity of cross-border transactions means the most trusted and confident cross-border lawyers will be in high demand.

Some of the key challenges include: i) Compliance risk; ii) Conflict of laws; iii) Unfamiliarity of overseas lawyers with local laws and regulations; iv) Third party rights; v) Working with foreign lawyers qualified in various countries; vi) IPR issues; vii) Data protection; viii) Approach of courts: enforcement and recognition of awards and judgements; ix) Transactional challenges: agreeing on the governing law, dispute resolution mechanism, choice of court, negotiations on mutually agreeable terms and conditions; x) Diverse tax regimes and its implications; xi) Complexities of the money/investments moving from one country to another and various regulations around the same; xii) Finding a local counsel suited and capable of assisting in the transaction; xiii) Drafting a document that suits and matches requirements of various jurisdictions involved – producing internationally resonant documents/agreements that the parties can engage with easily; xiv) Approach/friendliness of the target State towards foreign entities and foreign investments and interference in the legal system; xv) Practical challenges: language, culture, time zone.

A major challenge faced in cross border deals is failing to truly understand each other. Not because the parties literally speak different languages, but because when they use an expression they may mean something different than the counterparty or a response may be couched in terms that are culturally appropriate for one party but leave the other party not understanding the response. For instance, in a joint venture context, it’s critical to make sure everyone understands which actions need the approval of both parties, which need approval of just one, and why, even if it is different from the governance traditions of one of the parties. Another issue is when both parties to the transaction are not taking a broad view of the potential issues and they hold back the breadth of ongoing activities. Failing to take the big picture into account from the outset can mean you only discover some issues late in the transaction, which can cause a scramble and waste resources.

Owing to the above challenges, both companies and law firms turn down on working on or getting involved in certain cross border transactions. Companies look for an all-round advisory and assistance on the aspects from law firms/external counsel with an expectation that the challenges would be overcome. Law firms are resultantly expected to be adept with handling and managing the challenges and delivering to the expectations of the company. This expectation, owing to the remote functioning during the pandemic, has increased manifold.

In cross-border transactions, which have been ever-growing, there are numerous factors involved – two domestic legislations and the international aspects of the transaction, multiple entities from varied nationalities. The companies expect a quick turn around on the deliverables, while the external counsel/law firms, endeavouring and employing their best efforts, attempt to deliver the desired assistance within the time frame.

One way of tackling the challenges is by adopting internationally accepted standards around the world. One way companies and law firms have tried to reduce the risk involved in doing a cross border transaction has been by agreeing the governing law of a deal. Reports suggest that companies and their advisers also saw a rise in commonality of drafting language as another means to reducing risk, with the most common being the US and UK drafting styles/language. It has been observed that a common or standard approach is emerging to manage the deal process, structuring and due diligence involved in cross-border deals.

The pandemic has given a chance to rethink and realign our working strategies and adopt mechanisms that are universally suited. Reliable sources of information and insight are hard to find and so most practitioners rely on personal networks and many a times, online resources tools, have also been put to use.

The best strategy for closing a deal usually is to make sure the company has experienced counsel – somebody who’s done that kind of deal in other markets numerous times and can explain issues to their clients. Otherwise, the company hears a diligence question, for instance, and may find it offensive or contrary to their practices. The best advisor for companies will say, “This is why they’re asking. This is why it’s important to them. This is why it’s in your interest to answer this diligence question up front in a very fulsome way.”

When working in any of the countries, it’s critical to have local counsel with experience both in the country and in the cross-border context. Compatibility between the main law firm and the local counsel is one of the keys to a successful transaction.

In arriving at a decision, it is important that the company listens to its advisers on the risks that are presented and taking a sober look at major red flags that are likely to present a significant liability that cannot be mitigated or that will prevent the business goals from being achieved. In these markets, there’s a very fine line. The only deals that get done are those where the businesspersons are persistent believers who are willing to go the extra mile and push when most people would give up. On the other hand, businesspersons need to have their eyes wide open. The most successful players in these markets are the ones who are willing to walk away, but who continue to apply the pressure needed to get to closing.

Apart from desiring the best and most sound legal advice companies also hope for competitive billing and rates from the law firms and external counsel. With this in mind, clients would expect that the hourly rates charged by a law firm is capped at a certain number of hours that are anticipated to be put in for the transaction or agree on a lump sum fee for the transaction or agree on blended hourly rates for the transaction or agree upon a hybrid system with hourly rates being charged and the fee being capped at a maximum. This can be worked out on the basis of the transaction, the complexity thereof, the relation between the client and the law firm, previous working arrangement between the client and law firm, quantum of work involved etc. As a result of the pandemic, companies prefer a cost effective, pocket friendly billing arrangement.

The emergence and evolution of the present times, where the world has become a global village, people at large distances connected with one another in real time, goods and services available at the click of a button, has been supplemented and driven by businesses being conducted across the globe without any jurisdictional boundaries. Despite the numerous challenges faced in conducting cross border transaction, these have grown exponentially and continue to enhance, thereby boosting the economies and achieving greater heights each day. The outbreak of the COVID-19 pandemic, no doubt halted the businesses and life as a whole, however, soon enough the companies were able to gather up and resume their transactions and deals, although some sectors more than the others. It will be interesting to see how these transactions unfold and what changes are noticed in them and how the businesses continue to expand keeping in mind the experiences of the pre COVID-19 period and the application of the learnings from the COVID-19 period, when the post COVID-19 era dawns.

The Daily Guardian is now on Telegram. Click here to join our channel (@thedailyguardian) and stay updated with the latest headlines.

For the latest news Download The Daily Guardian App.

Legally Speaking




The Madhya Pradesh High Court in the case Kuldeep Dohare Versus the State of Madhya Pradesh observed, recently the Gwalior bench directed the Director General of Police, State of Madhya Pradesh to file an affidavit explaining as to whether non-communication of criminal antecedents of an Applicant or Accused to the Court is a minor misconduct or if it amounts to interference with the criminal justice dispensation system. Before the next date of hearing, the affidavit is to be filled.

The bench comprising of Justice G.S. Ahluwalia observed and remarked that the court was frequently finding that the police authorities were not sending the complete criminal antecedents, in spite of the circular issued by Police Headquarters.

It was observed that the police authorities did not send the criminal antecedents of the applicant. Furthermore, it is clear that it is a clear attempt to facilitate the applicant to obtain bail by projecting that he has no criminal antecedents. The issue raised is weather the conduct of police officers can be said to be a minor negligence or it is an interference with the criminal justice dispensation system?

In the present case, the court was dealing with a bail application moved by the accused applicant for offences punishable under section 307, Section 149, section 148, section 147, section 506, section 294, section 201. On an earlier hearing, the court had observed that even though the case diary did not reflect any criminal antecedents on the part of the Applicant. The impugned order passed by the lower court rejecting his bail application mentioned otherwise.

It was observed that a reply was sought by the court from the Superintendent of Police, District Bhind as to why the important information with regard to the criminal antecedents of the Applicant were withheld by the respective SHO. The SP informed the Court on the subsequent hearing that the SHO concerned as well as the Investigating Officer in the case were found guilty of misconduct and were fined with Rs. 2,000 and Rs. 5,000, respectively.

The Court observed that since the problem was stemming from different police stations. However, the DGP should file his reply regarding the prevailing situation-

Since in different police station, this situation is prevailing. Therefore, an affidavit is directed to be filled by the DGP, State of Madhya Pradesh as to whether non- communication of criminal antecedents of an applicant is a minor misconduct or it amounts to interfere with the criminal antecedents of justice dispensation system.

Accordingly, the affidavit needs to be filled within a period of 1 week, the matter would be heard next on 08.07.2022.

Continue Reading

Legally Speaking




The High Court of Madhya Pradesh in the case Ghanshyam Gupta v. State of Madhya Pradesh and Ors observed and stated that Section 5 of the Limitation Act would be applicable to reference to arbitration under the National Highways Act, 1956.

The Division Bench comprising of Justice Ravi Malimath and Justice Purushiandra Kumar Kaurav observed and reiterated that since no limitation is provided under Section 3G (5) of the National Highways Act. The bench stated that the provisions of Article 137 of the Schedule to the Limitation Act, 1963 would apply to such proceedings.

Therefore, the court held that the limitation period for filing an appeal against the decision of the competent authority before the arbitrator from the date of expiry of 90 days is three years from the decision of the competent authority.


The petitioner, Mr. Ghanshyam Gupta was the landowner of the land which was acquired by the Respondent, Madhya Pradesh Road Development Corporation. Thereafter, the competent authority determined the quantum of compensation payable to the petitioner and passed an award to that effect on 30.07.2015.

The petitioner being dissatisfied with the quantum of compensation determined by the competent authority. On 04.12.2019, an appeal was filled by the petitioner before the arbitrator. The appeal was dismissed by the arbitrator as time-barred filed after the expiry of three years limitation period.

the petitioner filed a writ petition before the High Court, Aggrieved by the decision of the arbitrator.

Contentions Raised by the Parties:

It is stated that Section 5 of the Limitation Act is applicable to arbitration reference under Section 3G (5) of the National Highways Act, 1956.

It was observed that the petitioner was unaware of the availability of the remedy of appeal against the decision of the competent authority, the petitioner only after consulting his lawyer, that the petitioner came to know that he could seek enhancement. Further, there is a valid ground to condone the delay.

The submissions of the petitioner were countered by the Respondent on the following grounds:

Though, in the absence of a period of limitation for filing an appeal under Section 3G (5) of the Act of 1956, it was construed that the provisions of Article 137 of the Limitation Act would stand applicable.

It was stated that Article 137 provides for 3 years period, and the petitioner filed the appeal after a delay of 4 years.


The court observed and stated that since no limitation is provided under Section 3G (5) of the National Highways Act, the provisions of Article 137 of the Schedule to the Limitation Act would apply to such proceedings.

Therefore, the court held that the limitation period for filing an appeal against the decision of the competent authority before the arbitrator from the date of expiry of 90 days is three years from the decision of the competent authority.

The court observed that there is nothing in the National Highways Act that excludes the applicability of Section 5 of the Limitation Act. However, Section 5 of the Limitation Act would be applicable to reference to arbitration under the National Highways Act, 1956 and the arbitrator has the power to condone the delay against the award, in filing an appeal by the competent authority.

The court noted that the petitioner was not aware that an appeal could be filed against the decision of the Competent Authority and it is only after consulting his lawyer that the petitioner came aware of any such right, therefore, there is sufficient reason to condone the delay.

Accordingly, the application was allowed by the court and the court directed the arbitrator to decide the case of the petitioner on merit.

Continue Reading

Legally Speaking




The Kerala High Court in the case Saritha S. Nair v. Union of India & Anr observed and appointed an amicus curia to assist the court to decide the legal question of whether a statement recorded under Section 164 of the CrPC is a public document.

The bench comprising of Justice Kauser Edappagath appointed the amicus curiae, in the petition filled by Saritha S. Nair, the prime accused in the infamous solar panel scam seeking a direction to provide her with copies of the Section 164 statement given by Swapna Suresh, the accused in the gold smuggling case.

The court appointed Advocate K.K. Dheerendrakrishnan, as the amicus curiae in the case.

In the present case, it was observed that Saritha Nair is accused of having duped several influential people to the tune of 70 lakhs, by offering to install solar power units for them or by making them business partners and by receiving advance payments for the same.

Moreover, Swapna Suresh is accused of smuggling 30 kilograms of gold through diplomatic cargo dispatched to UAE Consulate at Thiruvananthapuram.

It was observed that when the petition came up for hearing, the counsel appearing for the petitioner, Advocate B.A Aloor appearing that the statement given by Swapna was a public document and therefore the petitioner was entitled to get a copy.

Further, Nair approached the Court apprehending that certain allegation may have been brought on record against her in the statement given by Suresh. It was prayed by Nair, that the c court allow her plea, directing the production of certified copies of the said document to her, failing which she would sustain an irreparable injury, the hardship and as well as physical and mental agony.

It was observed that the Nair had had initially moved the Principal District and Sessions Court of Ernakulam, with the same request, but this was denied. The court noted and adjourned the matter to July 11, while on a petition filed by the accuse, Saritha S. Nair in the solar scam cases, for seeking a directive to provide a copy of the statement given by Swapna Suresh, accused in the diplomatic gold smuggling case before a subordinate court.

Continue Reading

Legally Speaking

Supreme Court issues notice in an SLP; can section 156 (3) CRPC be invoked after failing to get desired relief in a civil suit?

It was observed that before the Calcutta High Court, it was contended by the accused that the allegations made in the application under Section 156(3) CrPC fails to make out any offence against them. Further, it was submitted that a frustrated unsuccessful litigant before the Civil Court has approached the Criminal Court and the Criminal Investigation.



The Supreme Court in the case Usha Chakraborty vs State of West Bengal observed and issued a notice in a Special Leave Petition filled, raising an issue whether in a dispute essentially in a dispute of civil nature that can a person, after having failed to get the desired relief from a civil suit, invoke Section 156(3) of the Code of Criminal Procedure?

In the present case, an FIR was registered against the accused under Sections 323, Section 384, Section 406, Section 423, Section 467, Section 468, Section 420 and Section 120B of the Indian Penal Code, 1860 following an order passed by the Magistrate under Section 156(3) CrPC.

It was observed that before the Calcutta High Court, it was contended by the accused that the allegations made in the application under Section 156(3) CrPC fails to make out any offence against them. Further, it was submitted that a frustrated unsuccessful litigant before the Civil Court has approached the Criminal Court and the Criminal Investigation, which has commenced, is for the purposes of throttling them. The petition was dismissed by the High Court observing that the materials which have already been collected by the Investigating Agency, prima facie, make out a case for investigation. The issue raised before the court was weather the same would make out an offence after the investigation is concluded is absolutely at the end of the investigation to be analysed.

Therefore, challenging this order, one of the accused approached the Apex Court. However, It was submitted that the dispute is essentially of civil nature, for which the applicant in Section 156(3) CrPC petition filed a civil suit but having failed to get the desired relief, he invoked Section 156(3) CrPC.

The bench comprising of Justice Surya Kant and the Justice JB Pardiwala, while issuing notice also stayed further proceedings in FIR lodged against the accused.

Continue Reading

Legally Speaking




The Gauhati High Court in the case Jugitawali Pawe v State of Assam and 15 ors observed and quashed a resolution expressing no-confidence in the petitioner – the President of a Gram Panchayat, as a result of which she as removed from office. It was stated that it is as per the citing no compliance with Assam Panchayat Act, 1994, reading with Rule 62 of the Assam Panchayat (Constitution) Rules, 1995.

It was preferred by the petitioner to the materials available on record to argue that one of the members of the Gaon Panchayat, the respondent. The respondent voted against the petitioner and had given birth to her third child the previous year. Moreover, by virtue of Section 111(2)(a) of the Assam Panchayat Act, 1994, reading with Rule 62 of the Assam Panchayat (Constitution) Rules, 1995, the petitioner stood automatically disqualified on the date of voting. Following, which her vote was taken by passing No-confidence motion.

It was prayed by the petitioner in the plea for setting aside the impugned resolution and for issuance of a direction to restore his client back in the office. Thereafter, to initiate fresh proceedings, liberty should be granted to the respondent, following the due process.

It was agreed by the Counsel representing for the respondent that the said member of the panchayat had been disqualified but retained on the ground that the disqualification would have no bearing on the petitioner’s case, as the impugned resolution was passed before the declaration of petitioner disqualification.

In the present case, It was noticed by Justice Suman Shyam the member had voted against the petitioner and without her vote. The petitioner would not have been ousted from office. Justice Shyam also found no dispute about the fact that the member had incurred disqualification under the law prior the date of adoption of the impugned resolution. Justice Shyam found it unnecessary to delve into other aspects of the matter which includes the procedural formalities for declaring the member a disqualified candidate.

It is observed that the impugned resolution was declared to be vitiated and liable to be set aside. Further, the Court restored the petitioner to the office of the President of the Bongalmara Gaon Panchayat with immediate effect and it was stated by the court that the order will not stand in the way should the authorities or any member of the Gaon Panchayat propose a fresh motion of “no-confidence” against the petitioner and the due process of law needs to be followed.

Continue Reading

Legally Speaking

Halt DDA’s demolition action against jhuggis in Nizamuddin’s Gyaspur area, orders Delhi High Court

As per the JJ Rehabilitation and Relocation Policy 2015 and the Delhi Urban Shelter Improvement Board, the residents who can establish their residence prior to 01.01.2015 are eligible for rehabilitation under the JJ Rehabilitation and Relocation Policy 2015.



plea in Delhi High Court seeking repatriation of 56 pregnant nurses

The Delhi High Court in the case Manoj Gupta & Ors. v. DDA & Ors observed and has ordered status quo on the Delhi Development Authority’s proposal to demolish jhuggi clusters in city’s Gyaspur area in Hazrat Nizamuddin. The vacation bench comprising of Justice Neena Bansal Krishna observed in the petition filled by the residents and the court granted an interim relief.

It was ordered by the court status quo till July 11, the next date of hearing.

The bench orally remarked that a ten-day delay in demolition won’t make a difference but if today it is demolished and later, we come to know that they were entitled, who’s going to… the bench will consider it on July 11, 2022 but in the Meanwhile, some protections are entitled them. Adding this, Status quo be maintained. If since 1995, they have been there, heavens won’t come down if for 10 more days they are protected.

In the plea the petitioner stated that the T-Huts settlement in the area, which was stated by the authorities to vacate. It has been in existence for almost two decades and compromise of 32 jhuggis or households.

In the plea it was alleged that the bulldozers have been parked around the camp and a DDA official has orally asked them to vacate the area and it is noted that till date no proper notice have been sent to them nor has DDA conducted any survey of the area.

Furthermore, the DDA did not provide any alternate arrangement for their rehabilitation which resulted in extreme distress among the residents.

Moreover, it was admitted by the petitioner that the land in question belongs to DDA and they may seek that status-quo to be maintained at the site. It was urged that the residents should not be physically dispose or evicted from the demolition site until the survey is conducted and rehabilitation is provided to the residents as per the DUSIB policy of 2015.

As per the JJ Rehabilitation and Relocation Policy 2015 and the Delhi Urban Shelter Improvement Board. The residents who can establish their residence prior to 01.01.2015 are eligible for rehabilitation under the JJ Rehabilitation and Relocation Policy 2015.

It is observed that in the case Ajay Maken v. Union of India, Reliance is placed on the Supreme Court decision and the High Court decision in the case Sudama Singh & Ors. v. Government of Delhi & Anr, it was held in the case that that removal of jhuggis without ensuring relocation would amount of gross violation of Fundamental Rights under Article 21 of the Constitution. Further, it was held that the agencies conducting the demolitions ought to conduct survey before undertaking any demolition.

It is submitted that these observations would apply across the board, in the entire NCT of Delhi.

Advocates Vrinda Bhandari, Shiyaz Razaq, Kaoliangpou Kamei, Jepi Y Chisho and Paul Kumar Kalai, represented the petitioner.

Continue Reading