Tag: Delhi high court

Nayara Energy, a refiner supported by Russian oil giant Rosneft, filed a lawsuit against Microsoft in the Delhi High Court after the latter ceased to provide services to the company due to EU sanctions. Microsoft is “currently restricting Nayara Energy’s access to its own data, proprietary tools, and products—despite these being acquired under fully paid-up licenses,” according to a statement released by Nayara Energy on 28 July.

According to Nayara Energy, this decision creates a risky precedent for corporate overreach and raises significant worries about its effects on India’s energy ecosystem because it is based only on Microsoft’s unilateral interpretation of recent European Union (EU) sanctions.

In order to protect its rights and guarantee ongoing access to crucial digital infrastructure, the company has petitioned the Delhi High Court for an interim injunction and the resumption of services. The purpose of these actions is to avoid any possible interference with Nayara’s capacity to fulfil its commitments to Indian stakeholders and customers.

What’s Behind the EU Sanctions?

In its latest attempt to pressure Russia to put an end to the conflict in Ukraine, the European Union said on July 18 that it was suspending Nayara Energy, in which the Russian oil giant Rosneft owns a 49.13 percent interest.

Nayara Energy’s exports of petroleum products and fuels to Europe would be prohibited by the sanctions, which might also affect its business relationships with European firms. Rosneft’s intention to leave Nayara may also be hampered since potential investors may be alarmed by the EU sanctions.

Impact on India’s Energy Sector

Nayara Energy has a network of about 6,800 fuel retail locations and owns and runs a 20 million-ton oil refinery in Vadinar, Gujarat, annually. It makes up about 7% of India’s fuel retail network and 8% of the nation’s overall refining capacity. Through its own retail network, institutional sales, and alliances with other oil marketing firms, Nayara Energy mainly serves the domestic market.

Nayara Energy’s Russian Ties: A Quick Background

Formerly known as Essar Oil, the business was a member of the Essar group. After being purchased from the Essar company by a group of investors that included Rosneft, it was renamed Nayara Energy. Similar to Rosneft, a 49.13% share in the company is held by Kesani Enterprises, a consortium managed by Russia-based United Capital Partners (UCP) and Italy’s Mareterra.

Despite being owned by a consortium of foreign investors, primarily from Russia, Nayara insists that it is an Indian business subject to Indian law. In a statement released on July 28, Nayara Energy stated that although the EU is the only source of the penalties, Microsoft, a company with its headquarters in the US, has decided to stop providing services to Nayara Energy without being required to do so by US or Indian law.

Microsoft’s Position and Global Implications

Under the pretence of compliance, this action was performed unilaterally, without previous warning, consultation, or redress. These actions reveal a concerning pattern of multinational firms introducing foreign legal systems into areas where they are not applicable.

The refiner went on to say that Nayara Energy complies completely with Indian rules and regulations in all aspects of its business operations and maintains constant contact with Indian authorities to guarantee accountability and transparency. Notwithstanding these outside obstacles, Nayara Energy is steadfast in its resolve to provide continuous service and supply to meet India’s energy needs.

Microsoft Restores Services to Russia-Linked Nayara Energy, Stirring Global Debate

According to a Reuters report, Microsoft has restored IT services to Nayara Energy, an Indian oil refinery financed by Russia. Microsoft was sued by Nayara for abruptly suspending services after the European Union imposed further sanctions on Russia.

Nayara’s attorney informed a court in New Delhi on 31 July that the US corporation had restored the services, according to a Reuters report. Before the planned hearing, Microsoft restored all services, including full access to the email system, Microsoft Teams platform, and other Microsoft services, according to a PTI report that cited sources.

Recent sanctions from the EU have had a major effect on Nayara’s business operations, forcing the company to scale back operations at its refinery, which can process 400,000 barrels per day. Limited fuel storage facilities and vessel operators looking to end their contracts with the corporation were the main causes of the limitations.