Key Point

The year 2025 marked unmanned aviation’s transition from emerging technology to strategic infrastructure. Combat drones reshaped modern warfare across three continents, forcing governments to abandon experimental regulation. What followed was coordinated hardening: permissive frameworks gave way to permanent legislation, enforcers prosecuted violations aggressively, and security agencies imposed sweeping restrictions on foreign-manufactured systems.

In India, the Ministry of Civil Aviation released a draft bill proposing the country’s first standalone drone law with criminal penalties for even minor violations criticized as a step backward. The securities regulator barred a listed drone company after uncovering multi-crore fraud involving fabricated revenues and IPO fund diversion. The Karnataka High Court ordered a Special Investigation Team for alleged defense-grade drone technology theft, acknowledging conventional investigators lacked sophistication for such cases.

Background Facts

Internationally, the United States led recalibration. Its communications regulator banned foreign-manufactured drone imports, Congress expanded counter-drone powers, and the FAA proposed comprehensive rules for beyond visual line of sight operations. The UK mandated direct remote identification for all consumer drones, Europe formalized an updated risk assessment framework, Germany authorized police to destroy threatening drones, and Australia launched population-density trials. This wrap is a jurisdiction-wise record of precedents that will govern unmanned aviation in 2026 and beyond.

Decision in the High Court

The High Court agreed with Afrasia and set aside the award. The Court found that the Transfer of Business Act applies to banking transactions as well as to other
transfers of businesses. The Court held that excluding the application of the act “would create room for businesses, especially banks, to engage in opaque transfers to the detriment of their customers.” On this basis, the Court found that the award was wrong in law and against public policy. It held that SBM’s failure to publish the requisite notice under the Transfer of Business Act rendered it liable for all of Chase Bank’s liabilities. The Court therefore set aside the arbitral award and entered judgment for Afrasia. The High Court also granted leave to appeal this decision upon an informal application made by SBM.

Comment

The Court of Appeal decision is welcomed as it clarifies the procedure for challenging arbitral awards. It reinforces the finality of arbitral awards by limiting the jurisdiction of the High Court in granting peremptory leave to appeal such decisions. This ensures commercial predictability which is fundamental to contracting parties. It also clarifies the extent of party autonomy in agreements to appeal awards to the High Court and Court of Appeal. The case emphasises the need for parties to clearly draft their arbitration agreements and provide for 2 levels of appeal where the Courts’ input on an arbitral award is considered desirable.

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