Chinese app Club Factory may invoke force majeure to counter Indian firms

Topics China | Apps | WeChat

Photo: Shutterstock
Banned Chinese fashion and lifestyle e-commerce company Club Factory is planning to invoke force majeure to counter Indian companies and vendors that have approached courts to recover dues, according to an Economic Times report. 

Cyfuture and Aegis, BPO companies which provided customer-care support to Club Factory, have filed separate cases against the Chinese factory in the Delhi High Court to recover a combined Rs 5 crore. In June 2020, India had banned several Chinese apps. Club Factory is citing that decision as a situation beyond its control. 

Several other Indian firms and vendors are unable to find a representative or office contacts for Club Factory to recover their dues. 

“For some months, Club Factory just kept saying they are processing our payments,” said Sumit Patel of Surat-based Madeii Ecommerce, which sold watches and masks on the Chinese e-commerce site. “Now even the vendors’ log-in on the site is not working and we have no way to contact them.” 

Cyfuture sent a legal notice to the company’s office in Indian. Vendors have moved courts to recover dues from Club Factory, invoking an arbitration clause, and it was returned with remarks that the company had “left” India, according to legal documents. 

“Most of the officials of the respondent company have left the country and are proactively looking to evade any liability from its service providers,” lawyers for Cyfuture said in court documents, according to a Delhi High Court order on March 17 while issuing notices to Futuretimes Technology India, the company that operated Club Factory in India. 

Club Factory reported that it had surpassed 100 million monthly active users in India. 59 Chinese apps including TikTok, WeChat, and UCBrowser we blocked by India after a clash in the Galwan valley that left 20 Indian soldiers dead in June 2020.

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