According to a court document, British company Cairn Energy filed a case in a US district court to enforce a $1.2 billion arbitration award it won in a tax dispute against India.
In December, an arbitration body awarded Cairn damages of more than $1.2 billion-plus interest and costs. The panel declared that India breached an investment treaty with Britain and said New Delhi was liable to pay. The court filing showed that Cairn wants to enforce the award under international arbitration rules, also called the New York Convention, and recover losses caused by India’s “unfair and inequitable treatment of their investments.”
As per a February 12 filing seen by Reuters, Cairn urged the US courts to confirm the award and payment due since 2014 and interest compounded semi-annually. A source with knowledge on this matter told Reuters it is the British firm’s first step to recovering its dues, potentially by seizing Indian assets, if the government doesn’t pay. The source said: “If Cairn wins the case, it will be a step towards attaching and seizing Indian assets overseas, especially in the US.”
Cairn has not commented on the matter yet. However, through a Twitter post on February 9, it said Chief Executive Simon Thomson was looking forward to meeting India’s Finance Minister in Delhi next week. In a video posted, Thomas said: “We would request, along with others, that the Indian government move swiftly to adhere to the award that has been given.” He also added that it is crucial for the company’s shareholders who are global financial institutions to witness a positive investment climate in India.