Breaking News
0
Ad-Free Version. Subscribe now to follow markets, faster and distraction-free. More details

Exclusive: Winson Oil wins favourable ICC decisions in claims against banks - documents

CommoditiesSep 15, 2020 21:42
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Anshuman Daga

SINGAPORE (Reuters) - A Singapore oil trader has won favourable decisions from the Paris-based International Chamber of Commerce (ICC) against two banks in trade-finance disputes related to troubled Hin Leong Trading, documents reviewed by Reuters showed.

Winson Oil Trading Pte Ltd believes the non-binding decisions will strengthen its claims in court against Standard Chartered Bank (Singapore) (L:STAN) and Oversea-Chinese Banking Corp (OCBC) (SI:OCBC), sources familiar with the matter said.

Stanchart and OCBC both declined to comment.

In June, the trader took legal action separately in Singapore against the two banks for non-payment of $30.4 million each for diesel cargoes it sold to Hin Leong Trading (Pte) Ltd that Hin Leong financed via letters of credit (LC) issued by the banks, according to court documents.

Letters of credit are standard instruments of trade finance.

Declining to honour the LC, OCBC had told Winson Oil that it had "serious doubts over the authenticity of the documents" and said Singapore-based Hin Leong had "admitted to executing fraudulent paper transactions," court documents show.

Winson Oil had said that StanChart failed to make payment, according to court documents.

Hin Leong, which used to rank among Asia's biggest independent oil traders, was placed under judicial management in April to restructure billions of dollars of debt after a crash in oil prices revealed a massive, years-long fraud at the firm.

Winson Oil's cases against the banks, which are due to be heard in Singapore, are among several disputes between counterparties of Hin Leong and banks on payment issues arising from oil deals with the trader.

Crystal Tung, executive director at Winson Oil, declined comment to Reuters on the ICC decisions, citing the court cases. Omni Law, its law firm for the cases, declined comment.

Alya Ladjimi, manager of the ICC International Centre for Alternate Dispute Resolution (ADR), declined comment, citing confidentiality.

Winson Oil's claims in the ICC against the two banks were made under its Documentary Instruments Dispute Resolution Expertise (DOCDEX) rules, administered by the ICC International Centre for ADR, the documents show.

Three lawyers contacted by Reuters said favourable DOCDEX decisions are used by companies to support their claims in court by highlighting the international expertise of ICC's panelists.

The decisions, however, are not binding unless parties have otherwise agreed. The ICC documents show that OCBC is of the view that the dispute was outside the scope of DOCDEX rules and Winson Oil had already started court proceedings.

Stanchart's lawyers requested withdrawal of the DOCDEX claim, and considered "the lawsuit more appropriate for the case," the documents show.

In the case against OCBC, ICC's panel of three independent experts unanimously concluded that under ICC's rules on documentary credits - known as UCP 600 - OCBC was "obligated to honour the presentation made against documentary credit," a document dated July 30 shows.

However, the panel said that the issue of fraud was outside the scope of UCP 600 and was for the courts to rule on.

"On the basis of that, the panel of experts is not in the position to comment on the issue of fraud," and that issue was not taken into account, according to the 8-page document.

In Winson Oil's claim against StanChart, the panel unanimously concluded that under the scope of UCP 600, the lender was "under obligation" to honour the principal amount of $30.4 million, according to the 15-page document dated Aug 4.

The document shows that the panel said it reached a conclusion that the DOCDEX procedure was suitable to address issues raised by Winson Oil and that "the pending court proceedings and the respondent's allegation of fraud" do not prevent the panel from accepting the case for DOCDEX decision.

Exclusive: Winson Oil wins favourable ICC decisions in claims against banks - documents
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email