Cairn remains ‘confident’ as India appeals $1.2bn tribunal ruling

Cairn remains ‘confident’ as India appeals $1.2bn tribunal ruling

Cairn Energy confirmed today that India had appealed a tribunal's decision to award the Scottish oil firm $1.2 billion over the breach of an investment treaty.

Edinburgh-headquartered Cairn said it had “full confidence” in its position and would take “all step necessary” to protect the interests of its shareholders.

Earlier this month, Cairn said it had taken measures to have the award “recognised in certain major jurisdictions in which Indian sovereign assets have been identified”.

It is understood this move could potentially enable Cairn to seize assets overseas, including bank accounts, Air India planes or Indian ships, if the Asian country does not pay.

The tax row between both sides started in 2014-15 and centres on restructuring undertaken by Cairn ahead of the flotation of its Indian subsidiary in 2007.

The Indian Income Tax Department (IITD) restricted the firm from selling its shareholding in Cairn India, which was about 10% and worth £750m.

Following the merger in April 2017 of Cairn India and Vedanta, the shareholding was replaced by 5% equity in Vedanta.

The IITD later instructed the sales of 99% of Cairn's shareholding and seized proceeds of £455m.

London-listed Cairn argued India was trying to retrospectively apply tax legislation introduced in 2012 to transactions made by the