Tata Communications on Monday said it was considering challenging the Dutch court verdict, which has allowed access to its cable landing station in Mumbai for Anil Ambani Group's Flag Telecom.
"Tata Communications is disappointed with the decision of the Hague Court and is considering its options for appeal with its advisers," said a Tata Communications statement in New Delhi.
Meanwhile, Reliance Globalcom on its part confirmed receiving a copy of the judgement and said the Hague court had rejected all claims made by VSNL.
"Reliance Globalcom would continue in its endeavor to further enrich our diverse suite of best class and competitive service offerings for our enterprise, corporate and carrier customers to further enhance our leadership position across the globe," it said in a statement.
Due to technological advances, Flag is now in a position to enhance the capacity of cable system from 10 Gbps to 80 Gbps, for which it needs access to Mumbai landing station, the Reliance statement said.
Flag Telecom (now known as Reliance Globalcom), a subsidiary of Anil Ambani-led Reliance Telecom, wanted access to Mumbai landing station of Flag Europe Asia cable (FEA), a submarine fiber optic cable that runs from England to Japan, for the purpose of enhancing its capacity.
The stand of Tata Communications, formerly Videsh Sanchar Nigam Ltd, was that the under Construction and Maintenance Agreement between the two, it was under no obligation to grant access to Flag.
Flag took the matter for arbitration before International Chamber of Commerce. On May 17, 2006, three-member arbitration panel held that not only Mumbai, Flag can have access to each landing station of the cable system for the purpose of installing, inspecting etc and to equip the FEA with higher capacity.
VSNL approached the Hague District Court seeking to set aside this award. It contended that arbitration tribunal's decision was unreasoned, and contrary to the terms of contract between VSNL and Flag.
Meanwhile, Anil Ambani's Reliance Communication bought Flag Telecom for about $ 211 million. FEA, also called as landing stations, passes through 15 countries. In India, it is routed through Tata Communication (formerly VSNL), which controls its 'Mumbai landing station'.