SOCAR v Mubariz Mansimov: Commercial Court retains jurisdiction over Palmali asset-stripping claims

The Commercial Court has largely dismissed an attempt to set aside permission for proceedings to be served out of the jurisdiction in a dispute over two unpaid English arbitration awards worth a combined sum approaching $240 million, though a claim based on the so-called Marex tort has been struck out.

In The State Oil Company of the Republic of Azerbaijan & Ors v Mubariz Mansimov & Ors [2026] EWHC 2102 (Comm), Mr Justice Birt considered an application by the defendants, including Mr Mansimov and companies within the Palmali shipping group, to set aside an order of Jacobs J granting the claimants permission to serve proceedings abroad.

The State Oil Company of the Republic of Azerbaijan and related claimant companies hold two English-seated arbitration awards against Mr Mansimov and Palmali entities arising from loan and settlement agreements governed by English law. The claimants allege that, between 2018 and 2020, the defendants carried out a series of corporate restructurings, transferring shares and assets for nominal consideration, with the purpose of placing them beyond the reach of enforcement. The defendants maintain the restructurings were legitimate responses to financial pressure from Turkish lenders and reputational difficulties facing Mr Mansimov.

Three causes of action were pleaded: a claim under section 423 of the Insolvency Act 1986 to unwind transactions defrauding creditors, a claim in the Marex tort for inducing non-payment of the awards, and unlawful means conspiracy.

On the section 423 claim, Mr Justice Birt found a serious issue to be tried on whether the transfers were made at an undervalue, whether they were carried out for a prohibited purpose, and whether there was sufficient connection with England and Wales. He was unpersuaded by the defendants' explanation that unrecorded oral pressure from Turkish banks had driven the restructurings, noting the absence of any contemporaneous documentation, and observed that Mr Mansimov's own concession before him that he remained ultimate beneficial owner of the Palmali group sat awkwardly with the defendants' account of the 2020 restructuring. On connection with the jurisdiction, the judge held that the English law contracts underlying the arbitrations, and the timing of the restructurings relative to the commencement of those arbitrations, distinguished the case from Orexim Trading Ltd v Mahavir Port and Terminal Pte Ltd and brought it closer to Dornoch Limited v Westminster International BV and Integral Petroleum SA v Petrogat FZE.

The Marex tort claim fared differently. Mr Justice Birt held that the tort, established in Marex Financial Ltd v Sevilleja and confirmed after trial in Lakatamia Shipping Co Ltd v Su, requires a judgement or award to be in existence or imminent at the time of the impugned conduct. As the restructurings here took place months or years before any arbitration award was issued, that essential element was missing, and there was no serious issue to be tried on that claim. The conspiracy claim survived, save to the extent it relied on the Marex tort as unlawful means.

Turning to forum, the judge concluded England was clearly the appropriate venue, citing the centrality of the English arbitration awards and underlying English law contracts, the defendants' own willingness to litigate in London through a separate arbitration, and their consistent pattern of contesting jurisdiction wherever the claimants had sought to enforce the awards elsewhere. A late undertaking by the defendants to submit to Turkish jurisdiction was found too narrow to alter that conclusion.

The application to set aside was accordingly dismissed, save in relation to the Marex tort claim.