Antrix-Devas deal: Devas paid us Rs 4 crore, say US lobby firms

The controversial deal, signed in 2005 with Antrix Corporation, the commercial arm of the Indian Space Research Organisation (ISRO), is being probed by the CBI and the Enforcement Directorate.

Written by Johnson TA | Bengaluru | Published: August 24, 2016 4:13:01 am

BENGALURU-BASED space communications technology start-up Devas Multimedia spent nearly $660,000 (Rs 4 crore approx) on lobbying with the US authorities after the Antrix-Devas deal was cancelled by the UPA government in 2011, it has emerged.

The controversial deal, signed in 2005 with Antrix Corporation, the commercial arm of the Indian Space Research Organisation (ISRO), is being probed by the CBI and the Enforcement Directorate.

Devas Multimedia paid two American firms — Hogan Lovells US LLP and Williams and Jensen PLLC — a total of $660,000 through its US subsidiary, Devas Multimedia America Inc., to lobby with the US Department of Commerce and state and trade representatives for the Antrix-Devas deal, according to public disclosures made by the two firms to the US House of Representatives.

The firms have stated that they had been paid for lobbying over two issues: “Foreign direct investment and government procurement issues relating to a satellite communications contract in India” and “trade and investment issues related to India”.

The disclosures are public documents accessible online.

According to the firms, Devas Multimedia engaged the services of Hogan Lovells in 2011 — shortly after the Antrix-Devas deal was annulled in February 2011. The government had said that nearly 70 MHz (megahertz) spectrum given by ISRO to Devas was needed for security purposes.

The lobbying records show that Hogan Lovells received $140,000 from Devas Multimedia after its services were engaged in the second quarter of the 2011 fiscal. The firm also disclosed receiving $240,000 in 2012 and $150,000 in 2013 from Devas Multimedia.

The records show that Williams and Jensen was engaged in 2013, and received $130,000 that year.

The documents show that the lobbying was being done for “Devas Multimedia America Inc.f/k/a [formerly knows as] Devas Multimedia Pvt Ltd’’.

There are no disclosures made for lobbying in the US for Devas after the third quarter of 2013.

Among others, the CBI is investigating transfer of funds from Devas Multimedia’s India entity to a US subsidiary, and the use of these funds.

According to 2009-10 annual reports for Devas Multimedia and its wholly owned subsidiary Devas Multimedia America,

Rs 68.78 crore was moved from India to the US subsidiary in 2008 and 2009.

The RBI documents for clearances accorded for outward FDI for the 2007-2011 period show Devas Multimedia invested more than $12 million in its subsidiary.

Devas Multimedia is known to have had strong support from US authorities over the years. Former US Secretary of State Madeline Albright, former US National Security Advisor Sandy Berger and the head of the US Chamber of Commerce Thomas Donohue Sr were reported to have lobbied on behalf of Devas with the Indian government when the deal was alive. The company had high-profile foreign investors such as Columbia Capital and Telecom Ventures from the US and Deutsche Telekom.

After the deal was cancelled in 2011, Devas approached international courts to challenge the decision. A tribunal of International Chamber of Commerce in Paris and the Permanent Court of Arbitration tribunal at the Hague ruled in favour of Devas in September 2015 and July this year, respectively.

On August 11, the CBI filed a chargesheet against four officials of Devas Multimedia, including its US-based CEO Ramachandran Viswanathan, and four former officials from ISRO and Antrix Corporation, including former ISRO chairman G Madhavan Nair.

 

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