M&A Arbitrations in the Telecoms Sector

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Significant M&A activity in telecoms sector

Deal volumes[2]

Despite mounting a comeback in 2021, M&A activity in the telecoms sector faltered in 2022. The industry generated US$203 billion in deal value in 2021;[3] however, this had declined by nearly 40 per cent in the first three quarters of 2022 – a 10-year low. The drop in deal volume and value reflects the dramatic increase in the cost of debt during 2022. This has also reflected a change from leveraged investments to a refocusing on consolidation and divestment; 85 per cent of deal value in 2022 involved either in-country consolidations or infrastructure deals.[4] Although analysts at the beginning of the year looked to 2023 with optimism, mid-year statistics indicate that deal volumes and values have continued to fall by 7 per cent and 67 per cent respectively as compared with the second half of 2022.[5]

Context of deals

As evidenced by the statistics, the majority of these deals continue to be made up of in-country scale deals where in-country consolidation took place to rapidly scale businesses in the race for market dominance and to achieve economies of scale.[6] For instance, Rogers Communications’ acquisition of Calgary-based Shaw Communications for US$16 billion closed in April 2023. The acquisition makes Rogers Communications the second-largest cellular and cable operator in Canada. This is potentially a boon for the operator, which stands to benefit from Shaw Communications’ strong presence in Western Canada, allowing it to continue its roll-out of 5G throughout Canada.[7] Another noteworthy in-country scale deal is the joint venture deal struck between Vodafone and Altrice to invest €7 billion into upgrading and growing Vodafone’s existing German fibreoptic broadband network to include up to 7 million extra homes in Germany by 2029.[8]

By contrast, in-scope deals, which account for a mere 4 per cent of market activity, take a different form. The target company is usually a related but distinct business, enabling an acquirer to enter a new market. Generally, this happens when acquirers want to improve their market positions while also adding product lines, geographical reach or other important capabilities, while preserving the unique attributes of the company that it acquires.[9]

Next in line to scale deals in terms of volume and value continue to be infrastructure deals (which, with consolidation deals, amount to two-thirds of all deal value),[10] which mainly concern the divestment of digital infrastructure assets, such as cell towers and fibre assets. One of the most notable infrastructure divestment deals is Radius Global Infrastructure’s acquisition by Swedish private equity firm EQT, with the US Public Sector Pension Investment Board.[11] Radius owns and acquires critical digital infrastructure, including ground, tower, rooftop and in-building mobile telephone sites, in more than 20 countries across North and South America, Europe and Australia. The deal will see Radius keep its name and continue with its business largely unchanged, but demonstrates the strong attraction of divested telecoms infrastructure to private and public funds looking for long-term, reliable yield investments in a time of volatile bond markets. It also reflects previous trends in infrastructure divestment in previous years, including the deal announced in 2021 by France’s leading telecoms operator, Orange, to sell part of its fixed fibre assets in the country for US$1.58 billion to a consortium of three investors, comprising La Banque des Territories, CNP Assurances and EDF Invest consortium.[12] It is anticipated that these types of divestments will continue throughout 2023.[13]

Joint ventures

M&A deals are not the only big activity in the telecoms space. Companies have also been seen to participate in alternative deal structures, such as joint ventures, where neither shareholder wants to relinquish control. This option is usually objective driven, such as where there is a desire to consolidate networks but remain independent and as a means to carve out existing infrastructure or build new infrastructure but not wanting it to negatively affect balance sheet and funding considerations.[14]

Growing role of private equity

Beyond M&A, the telecoms market is also gaining complexity. As demand for mobile connectivity continues to grow because of the increased desire for connectivity, the rise in smartphone ownership, digital content consumption and streaming, it creates opportunities within the market. Telecoms providers have to invest in new network technologies to meet the demand for high-speed internet, but this also presents growth opportunities and presents itself as a lucrative investment for private equity firms as they seek to increase profit yield.[15]

The total value of private investments in the industry reached US$32 billion in 2022 (down slightly from US$35 billion in 2021).[16] This includes both asset investment and participation in operations, such as investing in a new tower, macro and micro sites, data centres and fibre networks.[17] Aside from the private equity-backed Radius deal mentioned earlier, other notable private transactions in 2022 have included the Carlyle Group commitment of US$1 billion to Tillman Global Holdings’ infrastructure vehicle, Tillman Infrastructure, to accelerate its digital cell tower network in the United States.[18]

Another reason for the proliferation of private equity in the telecoms market is the undervaluation of telecoms providers’ assets by the public market.[19] In at least one case, the controlling shareholder of the French telecoms provider, Iliad, considered the public market to be undervaluing Iliad’s shares. He offered US$3.6 billion to buy the remaining shares in the company, which he did not already own, in order to privatise the company.[20] The aim of the move to privatise is reportedly to achieve quicker transformation at value creation and obtaining investment.[21]

Market fragmentation

Although there has been an uptick in consolidation activity, there remains potential for further consolidation as the telecoms industry still sees fragmentation. For instance, the European Telecoms Network Operators’ Association found that the European telecoms sector lacked a single market and is heavily regulated, which is a reason for its fragmentation. It accounted for 38 operating telecoms groups compared with seven in the United States, four in Japan and three in South Korea.[22] There have been calls for the European Union to deregulate to take full advantage of economic opportunities arising from the growing digital platform, which indicates that consolidation activity will grow.[23]

Future trends

Moving forward, industry analysts predict that the telecoms space is primed for another active year in 2023.[24] We will continue to see consolidation deals, particularly in the fragmented and less regulated markets, and infrastructure divestment deals, as mature infrastructure offers a path for revenue growth. As companies re-evaluate their business models and sell non-core assets to improve their valuation, private equity firms will continue to be interested as major players in the sector.[25] Due to many operators facing balance sheet and funding rating constraints as they accelerate the build-up of new networks, coupled with existing shareholders’ desire not to relinquish control, alternative deal options such as joint ventures with private investors will continue to be attractive.[26]

Types of disputes arising

The types of disputes arising in respect of telecoms M&A can be broadly divided into ‘pure telecoms’ disputes and disputes that arise out of the contractual arrangements between the parties. Although it is likely that the latter will concern issues that relate to the telecoms asset, at their core, these are contractual disputes.

These types of disputes will be familiar to many arbitration practitioners and will relate to the precise terms of the transaction documents and arrangements, if any, between the parties following closing. As set out further below, the approach any tribunal will take in determining these disputes will depend on the applicable law and – in certain circumstances – the location of the telecoms asset. The themes of these disputes are largely similar irrespective of whether they are determined under a common or civil law system.

Disputes that typically arise as a direct result of the merger or acquisition include:

  • claims of misrepresentation;
  • breach of warranty;
  • failure to comply with closing mechanics;
  • breach of post-closing obligations (including purchase price adjustments); and
  • claims under indemnities.

A recent example of such disputes includes the claim filed by Telefónica, América Móvil and TIM on 3 October 2022 against the Brazilian operator, Oi, following their purchase of Oi’s mobile operations in Brazil through a public auction in late 2020.[27] The purchasers are seeking a US$600 million haircut to the US$1.3 billion purchase price just six months after the deal closed for alleged changes to working capital and capital expenditure not disclosed during the auction process.

In addition to disputes arising from the immediate aftermath of the trans­action, it is common for telecoms acquisitions to be structured as joint ventures (as discussed further, above). The management of the joint venture and the relationship between the parties, often pursuant to lengthy shareholder agreements, can give rise to further disputes including pure breach of contract claims, claims for specific performance of contractual obligations, claims for wrongful termination and – in certain circumstances – company law disputes regarding the management of the company. The long dispute (lasting more than a decade) involving multiple arbitrations between Çukurova Holding and various other shareholders (including Luxembourgish LetterOne, Dutch TeliaSonera and Russia’s Alfa Group) in Turkey’s largest mobile operator, Turkcell, serves as a famous example of such disputes.[28] Although these shareholder disputes will be largely governed by the contractual arrangements between the joint venture parties, there is increasing scope for issues of company law to arise particularly in circumstances where national governments have insisted on the licence being held by a local company. The increasing tendency of arbitrators to determine that they have jurisdiction over company law disputes in light of cases such as Fulham Football Club and others means there is a likelihood that shareholder disputes will become a common part of commercial arbitration more generally.[29]

In addition to the various contractual disputes that may arise, there are ‘pure telecoms’ disputes that arise as a result of the particular concerns of the telecoms sector. In particular, telecoms industries are heavily regulated. Operators are reliant on licensing consents from the regulator or governing body. These usually include restrictions on change of ownership, requirements for operators to meet certain standards of service, merger controls and payment of licensing fees.

Many of the largest, highest-value and most complex telecoms arbitrations that have been reported in recent years include issues of this kind. Because of the nature of these issues, disputes have commonly given rise to overlapping investor-state claims, running alongside commercial arbitration claims brought under the relevant M&A or joint venture documents.

The interaction in commercial disputes between shareholders and regulatory decisions has been a key feature of recent telecoms disputes. By way of example:

  • A failed acquisition of a mobile operator in Senegal has given rise to multiple International Chamber of Commerce (ICC) arbitrations between the proposed buyers and the seller.[30] The dispute arose out of the seller’s decision to terminate an agreement to sell the mobile operator and enter into a separate agreement with a new buyer. Two days later, the Senegalese president issued a decree approving the transfer of the mobile licence to the first proposed buyer. The ICC claims are still ongoing, leaving open the question of the effect of the government’s approval for the first transaction on the contractual claims.
  • In 2007, France Telecom (now Orange) pursued a claim for specific performance requiring Orascom (an Egyptian company) to sell its stake in the holding company of a local mobile phone operator.[31] France Telecom’s request was granted, and the tribunal ordered Orascom to transfer the shares at a price determined by the tribunal. Following the award, the Egyptian Capital Market Authority ordered a public tender of the mobile operator’s shares at the price per share set by the tribunal. Subsequent disputes between Orascom and France Telecom continued. The parties reached settlement in 2010.
  • A decision of the Iraqi regulator in 2014 to revoke its approval for a joint venture between Orange, Agility (a Kuwaiti company) and local shareholders has given rise to two separate bilateral investment treaty claims, a number of commercial arbitrations between the joint venture parties and litigation in the Dubai International Financial Centre (DIFC), Kuwait, the United States and elsewhere.[32]

Contractual frameworks and legal risk

Telecoms companies adopt a range of structures to give effect to joint ventures. Typically, however, the vehicle of choice is an incorporated joint venture, with a single operating company holding a national operating licence in the relevant territory. Depending on local law requirements and tax considerations, the joint venture vehicle will often be an offshore holding company. Indeed, several recent high-profile arbitrations in the telecoms sector have involved disputes among holders of equity in offshore holding companies. Examples include the US$600 million ICC arbitration between PT Ventures and Unitel, concerning a British Virgin Islands holding company of telecoms assets in Angola,[33] and the ongoing dispute between shareholders in Iraq’s Korek Telecom, who structured their investment via a DIFC holding company.[34]

The ‘topco’ shareholders will invariably enter into highly negotiated shareholder agreements that may provide a full suite of shareholder protections, including:

  • shareholder reserved matters, voting thresholds and board appointment rights;
  • put-and-call options on shares;
  • rules to govern contribution of equity and shareholder debt; and
  • non-compete obligations.

It follows that the sale and purchase of interests in operating telecoms ventures will frequently be structured as share sale and purchase at the topco level. The new shareholder will enter into the potentially complex suite of governance agreements that govern the joint venture and the relationships between the parties. Subject to local law requirements, it may well be necessary to obtain licensing approval for the change of ownership, and clearing the necessary consents (including merger control) will be a condition precedent to closing.

It is not surprising that disputes within the joint venture, more often than not, will have all the usual hallmarks of other forms of shareholder dispute. They will manifest as claims under shareholder agreements and potentially also in company law actions, such as unfair prejudice.

In this regard, telecoms joint ventures differ from other high-value joint ventures with a predisposition for arbitration. In particular, the upstream oil and gas industry and (to a perhaps lesser extent) the mining industry have perfected forms of unincorporated joint venture that have become industry standard. This allows buyers and sellers of interests in strategic assets to structure their trans­actions via the creation of direct contractual rights that reach into the underlying business. The archetypal agreement is the production sharing contract. Although parties will enter into heavily negotiated transactional documents to affect the sale and purchase of interests in those industries, the end result is not typically a share sale, but rather a ‘farm-in’, in which the buying party structures its entry into the asset-facing agreements.

In practice, disputes around price, misrepresentation and completion are apt to arise under a farm-in agreement, as they would under a share sale and purchase agreement. However, the relationship between the parties post-closing will be materially different in the two scenarios. In particular, disputes in the environment of an incorporated joint venture will take on the wider flavour of company law and may be influenced by unanticipated mutual rights and obligations that arise through common ownership of a company.

Common law approaches

The approach of the common law to telecoms disputes does not differ from disputes that arise in other sectors under contracts or in respect of companies. The approach will always depend on the relationship between the parties and the place of incorporation of the joint venture. However, there are a number of overriding principles to the common law approach to contractual and company law disputes.

The starting point of any contractual dispute will be the words of the contract to give effect to what the parties agreed.[35] Although tribunals, in certain circumstances, will move to imply terms to the contract or rectify clear mistakes, they will be slow to deviate from the clear words used by the parties. Tribunals will be even slower to imply terms or accept arguments of ‘commercial coherence’ when the parties have been advised by sophisticated legal counsel and the agreements have been heavily negotiated. There is a strong presumption that if the parties had meant to address a particular issue, they would have done so. The aim of providing parties with legal certainty takes precedence over issues of fairness or commerciality. Such concerns will only be taken into account if – and only if – the language of the contract could support different constructions.[36] The result is that the majority of disputes arising in respect of the transaction documents will be determined exclusively by reference to the terms of the contract.

However, it is important not to neglect the growing line of authority in the common law on general and specific duties of good faith. These should not be viewed as exceptions to the general rule that the common law will give precedence to the words of the contract – the common law will only move to imply terms into contracts if they do not contradict the express words of the contract and more generally if the contractual framework permits the implication of the relevant term. In addition to case-specific implied terms, in certain circumstances, the court or tribunal will imply duties of good faith.

The general duty of good faith has been developed under English law following the Yam Seng case, which found that where the contract was long-term, which provided for a close working relationship between the parties, it could be considered a ‘relational contract’ and thus a general duty of good faith could be implied into the contract.[37] This has been expanded in Bates and subsequent case law to establish a set of indicators for ‘relational contracts’ and when a general duty of good faith will be implied.[38] As set out above, telecoms investments are often structured as long-term investments through joint ventures with accompanying complex shareholder arrangements. The Bates indicators of a relational contract include a commitment on the part of the parties to collaborate with each other, to have a high degree of communication and cooperation, a substantial investment and exclusivity. All these factors are commonly present in long-term arrangements between partners of telecoms operators.

Alongside the growing jurisprudence on general duties of good faith, recent English case law has suggested that courts and tribunals will imply specific obligations of good faith when parties exercise contractual discretion.[39] Although the instances of courts and tribunals implying specific duties of good faith are limited,[40] they remain a powerful tool for joint venture partners when arguing that a partner has exercised a contractual discretion in a manner that serves their interests and is generally unreasonable.

Finally, an often-neglected aspect of common law is the development of rights of minority shareholders. Over time, the common law developed powerful protections for minority shareholders, including pursuing derivative actions in the name of the underlying company against directors and other controlling shareholders and claims against the majority shareholders for managing the company in a manner that is prejudicial to the interests of the minority. An interesting example of the interplay between concepts of good faith and minority shareholder protections is the decision in Mark Faulkner & Ors v. Vollin Holdings Limited & Ors,[41] in which the Court of Appeal of England and Wales was required to decide the scope of an express contractual duty of good faith in a shareholders’ agreement regarding the rights of minority shareholders. There, it was decided that the overriding ‘minimum standard’ of good faith in English law is for the parties to behave honestly. Any extended requirements (such as a fidelity to the commercial bargain or not using rights for collateral purposes) would depend closely on the facts of each case and the wording of the relevant documents. Where the court of first instance had found the good faith provision had been breached (and, accordingly, granted the petition that required the purchase of the minorities’ shares), the Court of Appeal disagreed and reversed the lower court’s decision.

The availability of such remedies will depend on the place of incorporation of the joint venture company. If the joint venture company is incorporated in a common law jurisdiction, there remains a question as to whether the tribunal or the local courts have jurisdiction over the right of the minority shareholder to pursue a claim in the name of the company.[42] However, cases such as Fiona Trust and Fulham Football Club suggest that tribunals will feel able to assert jurisdiction over company law issues.[43] It remains to be seen whether counterparties will increasingly seek to address these remedies in their contractual arrangements – either through imposing restrictions on the exercise of such remedies or by permitting minority parties the right to pursue claims against the majority pursuant to the transaction documents.

How civil law disputes may differ

Concepts of good faith and fair dealing are – by contrast with common law jurisdictions – far more established and robust in civil law countries.

Many civil law jurisdictions hark back to the Napoleonic Code, which enshrined into law the requirement of parties to enter into and execute their contracts in good faith.[44] Today, good faith features prominently in the civil codes of countries in Europe,[45] Asia,[46] Latin America[47] and the Middle East.[48]

Despite its prevalence, there is no uniform definition of good faith and fair dealing between civil law jurisdictions. Instead, it is a flexible concept that is designed to ‘moralize contractual relationships’ and ‘temper the inequalities’.[49] Such moralisation and temperance has, for example in France, been held to include a duty of disclosure between the parties (concerning matters such as the quality of goods or services), a duty of loyalty in negotiations (preventing malicious or duplicitous negotiation tactics), a duty to exercise rights proportionately and in moderation, and a duty to cooperate to facilitate mutual performance (also known as the duty of loyalty, cooperation and coherence).[50]

It is not surprising that issues of good faith and fair dealing have featured in several arbitrations arising out of disputes in the telecoms industry.

In Dardafon v. Kosovo Telecom, an ICC tribunal ordered damages of €10 million be paid by Kosovo Telecom after failing to act in good faith during contract renewal negotiations with Dardafon.[51] Kosovo Telecom had presented Dardafon with an abrupt and late ultimatum that it accept the renewal terms or lose its licence. This, the tribunal held, breached the contract’s express requirement to negotiate in good faith, as well as the general requirement of good faith under Yugoslavian law. Kosovo Telecom’s presentation of the proposed revenue-sharing model just 11 days before expiry of Dardafon’s licence, their insistence on unilateral conditions and their refusal to extend the window for negotiations all constituted bad faith.

In DigiTelCom Ltd v. Tele2 Sverige AB,[52] an International Centre for Dispute Resolution tribunal considered the scope of the implied covenant of good faith and fair dealing imposed under New York law.[53] The claimant, DigiTelCom, was a minority shareholder in St Petersburg Telecom and Oblcom (both Russian telecoms companies). The respondent, Tele2, became the majority shareholder in both companies but the parties disagreed about how to expand the companies’ wireless phone service. To resolve this disagreement, they entered into several agreements whereby DigiTelCom would exit as a shareholder while obtaining the digital network licence and access to Tele2’s roaming services. DigiTelCom subsequently accused Tele2 of having breached the various agreements, including the implied term of good faith and fair dealing under New York law. The tribunal rejected DigiTelCom’s claim by holding that Tele2 had cooperated in good faith to try to effect the transfer of the digital network licence (including, at times, being more proactive than DigiTelCom in negotiations with the regulator), while all other issues complained of were outside the control of Tele2. DigiTelCom’s claims were accordingly dismissed.

In Telenor Mobile Communications AS v. Storm LLC,[54] a United Nations Commission on International Trade Law tribunal considered whether the respondent had breached an express contractual duty of good faith governed by New York law. The dispute arose out of a shareholders’ agreement between the majority and a minority shareholder in the Ukrainian telecoms company Kyivstar. Storm, as a minority shareholder, was required to act in good faith to comply with and give effect to the shareholders’ agreement between it and Telenor. However, in breach of that duty, Storm refused to engage with and attend Kyivstar’s board and shareholder meetings, competed with Kyivstar’s business through its other telecoms companies, and commenced various other litigations against Telenor in breach of the shareholders’ agreement arbitration clause – all of which led to the total paralysis of Kyivstar and its business. The tribunal accordingly granted Telenor’s request for specific performance and ordered that Storm immediately comply with its obligations under the shareholders’ agreement.

The above-mentioned cases underscore the potential importance of good faith requirements in the telecoms industry. Telecoms companies are highly regulated, large and sophisticated operations that require a great deal of ongoing technical collaboration between its various stakeholders. It is not surprising in this context that issues of good faith – where applicable – can become of great importance. Nonetheless, whether a party breaches any such duty will necessarily and heavily depend on the particular facts of the case and the conduct of each party involved.

Conclusion

M&A transactions in the telecoms sector are high value and raise a complex array of financial, regulatory and political risk. Those risks arise in any jurisdiction, especially when factors such as merger control are taken into consideration. Self-evidently, however, the risks are enhanced in emerging markets, where data may prove less reliable and regulatory frameworks are still nascent. In this setting, it is a testament to the quality and care of deal lawyers that more arbitrations do not arise in the sector, following the closing of transactions. Transactions in the sector are heavily lawyered by sophisticated advisers, and deals are evidently structured to try to flush out risks at the condition precedent stage.

Where problems do emerge, however, they are likely to give rise to disputes that are marked by their complexity. This is especially so in circumstances where a seller of equity has remained in the structure (as is typical with a local operator that divests equity to raise the enormous capital needed to grow and sustain a telecoms business). These disputes are marked by internecine struggles between co-shareholders, often with overlapping claims under sale and purchase agreements, shareholder agreements and general company law. This overlap of claims can also give rise to jurisdictional battles, where the same issues can be framed by different parties as falling within the ambit of different agreements.

It is likely that disputes arising from telecoms M&A will be a setting for continued evolution of common law concepts of mutual good faith, given the long-term relationships between parties. It remains to be seen whether this will act as an inducement or a deterrent to those considering resorting to arbitration when their deals turn sour.


Footnotes

[1] Will Hooker is a partner and James Newton and Alysha Patel are associates at Pallas Partners LLP.

[2] ‘M&A Report: M&A in Telecommunications: How the End of Free Money Opens Up New Opportunities’, Bain & Company (31 January 2023) (https://www.bain.com/insights/telecommunications-m-and-a-report-2023/ (accessed 5 September 2023)).

[3] ‘Telecom M&A: Here Are the Latest Deal Trends Worldwide’, Bain & Company (11 May 2022) https://www.bain.com/insights/telecom-m-and-a-here-are-the-latest-deal-trends-worldwide-interactive (accessed 5 September 2023)).

[4] ‘M&A Report: M&A in Telecommunications’, op. cit. note 2.

[5] ‘Global M&A Trends in Technology, Media and Telecommunications: 2023 Mid-Year Update’, PwC Global (3 July 2023) (https://www.pwc.com/gx/en/services/deals/trends/telecommunications-media-technology.html#telecom (accessed 5 September 2023)).

[6] id.

[7] Reuters, ‘Rogers’ takeover of Shaw’s broadcasting business wins conditional nod from Canada’s CRTC’, Nasdaq (24 March 2022) (https://www.nasdaq.com/articles/rogers-takeover-of-shaws-broadcasting-business-wins-conditional-nod-from-canadas-crtc (accessed 5 September 2023)).

[8] ‘Vodafone and Altice to create a joint venture to deploy fibre-to-the-home in Germany, connecting up to 7 million homes’, Vodafone Group (17 October 2022) (https://www.vodafone.com/news/corporate-and-financial/vodafone-altice-create-joint-venture-deploy-fibre-to-the-home-germany (accessed 5 September 2023)).

[9] ‘The renaissance in mergers and acquisitions: How to make your deals successful’, Bain & Company (8 May 2013) (https://www.bain.com/insights/the-renaissance-in-mergers-and-acquisitions-how-to-make-your-deals-successful (accessed 5 September 2023)).

[10] ‘M&A Report: M&A in Telecommunications’, op. cit. note 2.

[11] ‘Radius Global Infrastructure to be acquired by EQT and PSP for about $3bn’, Financier Worldwide Magazine (May 2023) (https://www.financierworldwide.com/radius-global-infrastructure-to-be-acquired-by-eqt-and-psp-for-about-3bn (accessed 5 September 2023)).

[12] ‘Orange Sells Half of $3 Billion Fiber Unit to Fund Rural Rollout’, Bloomberg (23 January 2021) (https://www.bloomberg.com/news/articles/2021-01-23/orange-sells-50-of-fiber-unit-giving-it-3-3-billion-valuation#xj4y7vzkg).

[13] ‘Global M&A Trends in Technology, Media and Telecommunications: 2023 Mid-Year Update’, op. cit. note 5.

[14] ‘Telecommunications M&A: A Year of Resilience and Possibilities’, Bain & Company, (8 February 2022) (https://www.bain.com/insights/telecommunications-m-and-a-report-2022 (accessed 5 September 2023)).

[15] ‘Media and telecommunications: US Deals 2023 midyear outlook’, PwC Global (https://www.pwc.com/us/en/industries/tmt/library/telecom-media-deals-outlook.html) (accessed 5 September 2023)); ‘Private equity has its sights set on telecom infrastructure investment’, Outvise (8 September 2021) (https://blog.outvise.com/private-equity-has-its-sights-set-on-telecom-infrastructure-investment/ (accessed 5 September 2023)).

[16] ‘M&A Report: M&A in Telecommunications’, op. cit. note 2.

[17] ‘Private equity has its sights set on telecom infrastructure investment’, op. cit. note 15.

[18] News release, ‘Carlyle Partners with Tillman Global Holdings, Commits up to $1 Billion to Accelerate Investments in US Towers’, Carlyle Group (https://www.carlyle.com/media-room/news-release-archive/carlyle-partners-with-tillman-global-holdings-commits-up-to-1-billion-to-accelerate-investments-in-us-towers (accessed 5 September 2023)).

[19] ‘Why telecoms groups have fallen out of fashion with investors’, Financial Times (18 September 2020) (https://www.ft.com/content/fa4f6094-ea31-454b-b3c4-b62cbc012a40 (accessed 5 September 2023)).

[20] ‘French billionaire Niel bids $3.7 bln to take Iliad private’, Reuters (30 July 2021) (https://www.reuters.com/technology/french-billionaire-niel-offers-buy-out-de-list-iliad-telecom-2021-07-30/#:~:text=PARIS%2C%20July%2030%20 (accessed 5 September 2023)).

[21] ‘Eir’s owner Xavier Niel looks to take his business private’, The Irish Times (30 July 2021) (https://www.irishtimes.com/business/retail-and-services/eir-s-owner-xavier-niel-looks-to-take-his-business-private-1.4634792 (accessed 5 September 2023)); ‘French Billionaire Niel Bids $3.7 Billion to Take Iliad Private’, US News (30 July 2021) (https://www.usnews.com/news/technology/articles/2021-07-30/french-billionaire-niel-offers-to-buy-out-and-de-list-iliad-telecom (accessed 5 September 2023)).

[22] ‘Europe doubles 5G connections and passes 50% mark on FTTH, but still lags global peers’, ETNO (2 February 2022) (https://www.etno.eu/news/all-news/723-state-of-digi-2022.html (accessed 5 September 2023)); see also ‘The Digital Decade and the Telecom sector value creation’, Pub Affairs Bruxelles (28 September 2021) (https://www.pubaffairsbruxelles.eu/event/the-digital-decade-and-the-telecom-sector-value-creation/ (accessed 5 September 2023)).

[23] ‘The Digital Decade and the Telecom sector value creation’, op. cit. note 22.

[24] ‘M&A Report: M&A in Telecommunications’, op. cit. note 2.

[25] id.

[26] id.

[27] ‘Brazilian chamber to hear telecoms M&A dispute’, Global Arbitration Review (5 October 2022) (https://globalarbitrationreview.com/article/brazilian-chamber-hear-telecoms-ma-dispute (accessed 5 September 2023)).

[28] ‘Alfa venture wins “Russian roulette” order in Turkcell struggle’, Global Arbitration Review (5 August 2016) (https://globalarbitrationreview.com/article/alfa-venture-wins-russian-roulette-order-in-turkcell-struggle (accessed 5 September 2023)); ‘TeliaSonera wins share purchase dispute’, Global Arbitration Review (16 February 2017) (https://globalarbitrationreview.com/article/teliasonera-wins-share-purchase-dispute (accessed 5 September 2023)).

[29] Fulham Football Club (1987) Ltd v. Richards and another [2011] EWCA Civ 855; ZCCM Investments Holdings PLC v. Kansanshi Holdings Plc & Anor [2019] EWHC 1285.

[30] ‘Senegal telecoms dispute gives rise to ICC claims’, Global Arbitration Review (13 November 2017) (https://globalarbitrationreview.com/article/senegal-telecoms-dispute-gives-riseicc-claims (accessed 5 September 2023)).

[31] ‘Orascom and France Telecom clash over ICC award’ Global Arbitration Review (17 April 2009) (https://globalarbitrationreview.com/orascom-and-france-telecom-clash-overicc-award-0 (accessed 5 September 2023)).

[32] ‘Kuwaiti investor seeks to revive Iraq telecoms claim’, Global Arbitration Review (8 June 2021) (https://globalarbitrationreview.com/article/kuwaiti-investor-seeks-revive-iraq-telecoms-claim (accessed 5 September 2023)).

[33] PT Ventures SGPS SA v. Vidatel Ltd, Mercury – Serviços de Telecomunicacões SA and Geni SA, ICC Case No. 21404/ASM/JPA (C-21757/ASM).

[34] See Agility Public Warehousing Company KSC v. Republic of Iraq, ICSID Case No. ARB/17/7.

[35] See, for example, Wood v. Capita Insurance Services [2017] AC 1173; Arnold v. Britton [2015] AC 1619.

[36] Wood v. Capita Insurance Services, op. cit. note 35, [11]–[12].

[37] Yam Seng Pte Ltd v. International Trade Corporation Ltd [2013] EWHC 111.

[38] Bates v. Post Office Ltd (No.3) [2019] EWHC 606 (QB).

[39] Braganza v. BP Shipping [2015] UKSC 17; Mid Essex Hospital Services NHS Trust v. Compass Group UK and Ireland Ltd [2013] EWCA Civ 200; Equitas Insurance Limited v. Municipal Insurance Limited [2019] EWCA Civ 718.

[40] See TAQA v. Rockrose [2020] EWHC 58 (Comm) for an example of the court refusing to imply a duty of good faith.

[41] Mark Faulkner & Ors v. Vollin Holdings Limited & Ors [2022] EWCA Civ 1371.

[42] International Research Corp PLC v. Lufthansa [2013] SGCA 55; Sinwa v. Nordic International [2016] SGHC 111

[43] Fiona Trust and Holding Corp v. Privalov [2007] UKHL 40; Fulham Football Club op. cit note 29.

[44] French Civil Code, Article 1134 (‘Agreements legally formed have the force of law over those who are the makers of them. They cannot be revoked except with their mutual consent, or for causes which the law authorises. They must be executed in good faith.’) and Article 1135 (‘Agreements bind not only as to what is expressed therein, but further as regards all the consequences which equity, usage, or law attribute to an obligations by its nature.’).

[45] See, for example, French Civil Code, Articles 1134 and 1135; German Civil Code, Article 242; Spanish Civil Code, Article 7; and Dutch Civil Code, Articles 6:2 and 6:248.

[46] See, for example, Korean Civil Act, Article 2(1); and Japanese Civil Law, Article 1(2).

[47] See, for example, Chilean Civil Code, Article 1546; Mexican Federal Civil Code, Article 1796; and Brazilian Civil Code, Article 422.

[48] See, for example, United Arab Emirates Civil Code, Article 246; Egyptian Civil Code, Article 148; Kuwaiti Civil Code, Article 197; and Qatari Civil Code, Article 172.

[49] B Fauvarque-Cosson and D Mazeaud, European Contract Law – Materials for a Common Frame of Reference: Terminology, Guiding Principles, Model Rules (2008), p. 156.

[50] J Wild, ‘Duties of Good Faith – The Challenge of a Mixed Civil and Common Law Tribunal’, in C González-Bueno (ed.), 40 under 40 International Arbitration (2018), p. 70.

[51] ‘Kosovo Telecom ordered to pay mobile operator’, Global Arbitration Review (23 February 2022) (https://globalarbitrationreview.com/article/kosovo-telecom-ordered-pay-mobile-operator#:~:text=An%20ICC%20panel%20has%20ordered,with%20a%20local%20mobile%20operator (accessed 5 September 2023)).

[52] DigiTelCom Ltd v. Tele2 Sverige AB (Award, 15 September 2011), ICDR Case No. 50 494 T 00309 09.

[53] Restatement (Second) of Contracts (1981), Section 205: ‘Every contract imposes upon each party a duty of good faith and fair dealing in its performance and its enforcement.’

[54] Telenor Mobile Communications AS v. Storm LLC (Final Award, 2 July 2007).

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