A Scottish company competes for the plane of the National Airline of India

It seems unlikely that a Scottish company with 180 employees hijacked the plane of the National Airlines of India.

But Kane Energy is seeking authority to do this. This is the latest twist on the legal legend that is testing whether British Prime Minister Boris Johnson is willing to stand up for British companies when seeking a post-Brexit trade agreement. Out.

Cairn’s annual revenue is less than US$400 million, but its investors include companies such as BlackRock and Pioneer. Sue Air India Enforcement of the $1.2 billion plus interest ruling in New Delhi in New York-a total of $1.7 billion.

The oil and gas company is trying to prove that Air India is the “other self” of the Indian government and “therefore it is common.” .. Responsible for India’s own debts and obligations”, a move that may pave the way for the U.S. Marshals to seize the airline’s aircraft. It even hired attorney Dennis Hranitzky, who helped in 2012 Seizure of an Argentine warship Held in Ghana as part of a long battle between the American hedge fund Elliott Capital Management and Buenos Aires.

Kane’s award is Made by an international court In the Netherlands in December. If implemented, it may bring substantial returns to Kane shareholders and revive a company that has been stagnant for many years due to quarrels, which has been forced to divest assets, lay off employees and restrict investment.

But five months later, the government of Indian Prime Minister Narendra Modi (Narendra Modi) showed no signs of planning to pay.

This case is one of several cases between a Western company and New Delhi.Vodafone has also become Involved in a quarrel With India’s tax authorities, they demand arrears of 3 billion euros.

It happened during the sensitive period of Anglo-Indian relations.Last month’s country Outlines the “Roadmap for 2030” Strengthen ties between trade and national defense. London hopes to start negotiations on a comprehensive trade agreement this fall.

This struggle stems from a 2012 law that allows New Delhi to retroactively impose taxes on cross-border transactions of underlying assets in India.

In 2014, due to a tax investigation by the authorities, Kane was prohibited from selling its remaining 10% stake in its former subsidiary Kane India.The next year, it was slapped in the face $1.6 billion tax bill.

Kane filed a lawsuit under the Anglo-Indian bilateral investment treaty to forcibly withdraw tax requirements and seek compensation for economic losses. Most of its remaining shares in Kane India (later merged with Vedanta) were sold by the Indian tax authorities.

Johnson did not mention the dispute in his phone call with Modi last month. The UK’s position is that it does not participate in the legal process between investors and the country for which it is not a party, although people familiar with the matter said that previous governments have filed Kane’s case.

“We cannot be in a position where Boris Johnson has failed to stand up for the interests of British companies… just hope it will pave the way for future trade agreements,” Labor Party Shadow Trade Minister Emily Thornbury ( Emily Thornberry) said.

The Scottish government stated that it will ensure that “the economic and other interests of Scotland are clearly stated to the British government before and during any future discussions with the Indian government on a free trade agreement”.

Kane has determined that $70 billion in Indian assets can be traced globally, and insisted that it is still “willing to continue constructive dialogue with the Indian government.”

International arbitration experts say that other Indian-owned assets, such as stocks and bank accounts, may be easier to target, and the strategy for Air India — the Modi government is trying to privatize them — is designed to have the greatest impact.

“They are trying to reach a settlement,” said an international arbitration lawyer, who described Kane’s actions as “aggressive.”

New Delhi lawyer Satvik Varma said that Kane has little choice because Indian courts do not recognize international arbitration awards granted under bilateral investment treaties. “Kane is also responsible to its shareholders, and after obtaining the ruling, it must make every effort to seek enforcement,” he said.

Cairn’s top 15 shareholders said: “This is a lot of money-at the end of the day, maybe you have to be aggressive.”

Rasmi Ranjan Das, joint secretary of the Ministry of Finance, told the Financial Times that New Delhi is still in dialogue with Kane. “The government is open to friendly settlement,” but it must be “within the Indian legal framework,” he said. “The government’s position is that taxation is… a sovereign function.”

He pointed out that Kane is still participating in legal proceedings regarding Indian tax disputes. He said that Air India is a legally independent entity and “is not liable to pay the money under the Kane arbitration award or any other so-called debts or obligations of India.”

Kane said it was “full of confidence” in its position.

The lawyer said that the next logical step is for India to apply to “set aside” Air India’s proceedings in New York and wait for the proceedings of the Hague Arbitration Tribunal to be questioned.

The tax war has dealt a heavy blow to Kane. Its stock was worth more than £8 when the Indian retrospective law was introduced in 2012, but it is now trading at about 165 pence, although the stock has been affected by factors such as the plunge in oil prices. 2014 and 2020.

In addition to layoffs and asset sales in the early stages of the dispute, observers say that the uncertainty of the ruling limits Kane’s ability to compete for assets. For independent oil and gas companies that are out of sync with the stock market, scale is increasingly important.

“everybody knows [London-listed] Harbour Energy and Energean and these [larger independent oil and gas companies] Investec analyst Nathan Piper said they will be winners because they will be large enough to attract investors’ attention.

Cairn “has been trying to push the business forward since 2015… but they didn’t really do it because they were not sure if you got a billion dollars.”