Govt looking into Paris asset freeze by Cairn

The government is trying to check the details of India’s properties in Paris over which British energy major Cairn claims to have secured a freeze through a French court even as the company said it obtained two separate orders to enforce the $1.2 billion arbitration won last December in a tax dispute.Officials said India's properties in Paris are all diplomatic assets and would have immunity under the New York convention on international arbitration. “We are in touch with authorities in France to ascertain what these properties are and the court order about them,” one of them said. Most of the government-owned assets are residential properties of diplomatic staff that cannot be part of any arbitration, the official said.The company told ET the court order pertains to about 20 centrally located properties in Paris, primarily in the 14th and 16th arrondissements, belonging to the Indian government and valued at over₹20 million. “The French courts have now granted orders over properties owned by the government of India in Paris, on two separate occasions in June and July this year,” the company said, claiming that residential assets are covered.‘Residential Assets Not Immune’“The assets are not immune to such actions based on prior case law.”The Department of Revenue and Ministry of External Affairs are in touch over the issue, said the people cited above.Reports earlier this month said Cairn had obtained a freeze on residential real estate owned by the government of India in central Paris through the Tribunal judiciaire de Paris. The reports said the court order affected about 20 centrally located properties valued at over 20 million euros. The New York convention makes arbitral awards binding on signatories.India has already said it will take appropriate legal remedies to protect its interests but remained open to an amicable resolution to the tax dispute with Cairn Energy within its legal framework. The British company has registered the claim in multiple jurisdictions, including the US, UK, Canada, Singapore, Mauritius, France and the Netherlands to enforce the $1.2 billion arbitration award plus interest and penalty it won in December 2020 under the UK-India Bilateral Investment Treaty.84488584The company claims the government now owes it $1.7 billion. New Delhi has petitioned the Dutch Court of Appeal to set aside the award.The dispute arose in 2015 after the government demanded capital gains tax of ₹10,200 crore plus interest and penalty following a reorganisation of assets that Cairn undertook at its India unit in 2006, ahead of the listing of its shares in 2007.Conciliation effortsFollowing reports of the French court decision, Cairn had said it prefers an amicable settlement with the government of India. ET had reported earlier this month that the government has held talks with Cairn on a possible settlement. The government was ready to even consider legal changes, if needed, to settle the dispute.“Our strong preference remains an agreed, amicable settlement with the Government of India to draw this matter to a close, and to that end we have submitted a detailed series of proposals to them since February this year. However, in the absence of such a settlement, Cairn must take all necessary legal actions to protect the interests of its international shareholders,” a Cairn spokesperson said.

from Economic Times https://ift.tt/3ksPRwA