London court dismisses Deripaska company's appeal in dispute with BNP Paribas
MOSCOW, November 25 - RAPSI, Vladimir Yaduta. A London court has held against a petition filed by the Russian Machines, a subsidiary of Oleg Deripaska's Basic Element, and the Ingosstrakh Investments management company against BNP Paribas' claim. The court judgment's copy was made available to the Russian Legal Information Agency (RAPSI).
BNP Paribas requested the London High Court of Justice to prohibit the Russian companies from hearing the dispute at other courts including Russian courts as stipulated by the arbitration agreement between the bank and the Russian Machines company.
The dispute centers upon the loan guarantee contract signed between BNP Paribas and Russian Machines in October 2008.
The contract was signed to secure the $1.2 billion loan, which BNP Paribas granted to Russian Machines' subsidiary Veleron Holding B.V. in 2007 to acquire a 20-percent stake in Canadian Magna, a leading international car parts vendor.
The guarantee contract stipulates that all disputes between the parties should be heard under the regulations adopted by the London Court of International Arbitration (LCIA). Meanwhile, BNP Paribas is entitled to submit the case to the London High Court of Justice, according to the contract.
In August 2010, the bank filed a lawsuit with the London court. The bank seeks to recover $87,871 million in principal debt as well as interest and legal expenses.
However, the Steptoe & Johnson legal company, which represents the Russian companies in court, said the guarantee contract should be recognized null and void.
Ingosstrakh Investments, which manages Russian Machines' share owned by the Sotsium non-governmental pension fund, also claimed to invalidate the contract and filed a lawsuit against BNP Paribas and Russian Machines.