In a major boost to Cairn Energy, courts in five countries, including the US and the UK, have given recognition to an arbitration award that asked India to return $1.4 billion.
According to experts, this opens the avenue for Cairn to seize Indian assets in those countries if India does not pay the award. Cairn Energy had moved the courts in nine countries to enforce the award against India, which the company won after a dispute over a retrospective capital gains tax.
The December 21 award from the Permanent Court of Arbitration in the Netherlands has been recognised and confirmed by the courts in the US, the UK, the Netherlands, Canada, and France and Cairn has started the process of registering the award in Singapore, Japan, the UAE and Cayman Islands.
The registration of the award is the first step towards its enforcement if the award is not paid.
Earlier in February, Cairn India had said that it has discussed a number of proposals with the aim of finding a swift resolution that could be mutually acceptable to the Government of India and the interests of Cairn’s shareholders.