Winning an arbitration does not necessarily end a dispute. Where an award debtor refuses to pay and is alleged to have moved assets through foreign corporate structures, the real contest may begin only after the tribunal has rendered its decision.
On 7 August 2026, the High Court of Justice, Commercial Court addressed the issue. The State Oil Company of the Republic of Azerbaijan (“SOCAR”) and three affiliated companies alleged that Mubariz Mansimov and five related persons and entities (together, the “Defendants”) had undertaken a series of corporate restructurings designed to place assets beyond the reach of creditors, in connection with claims that later resulted in two London-seated arbitral awards. The immediate question was therefore procedural: could the Defendants set aside an order permitting the SOCAR Parties to serve their claims outside England and Wales?[1]
The Court held that the SOCAR Parties had a real prospect of succeeding on their claim under section 423 of the Insolvency Act 1986 (“section 423”) and their related unlawful means “conspiracy claim”. However, the “Marex claim” could not proceed because the alleged asset transfers occurred before any relevant award was in place or imminent. Accordingly, the order permitting service out of the jurisdiction was set aside in relation to the Marex claim and any part of the conspiracy claim relying on it.[2]
The judgment does not decide whether the Defendants improperly transferred assets or whether the SOCAR Parties will ultimately succeed. It holds only that the section 423 claim and related conspiracy claim are sufficiently substantial and connected to England to be tried there.[3]
I. Facts
SOCAR and the Palmali group of companies, founded by Mr Mansimov, began a commercial relationship in 2007. Palmali International Holding Company Limited (“PIHCL”) subsequently received substantial financing from the SOCAR Parties. A loan made in 2009 and later increased to a principal amount of USD 120 million was guaranteed by Palmali Holding Company Limited (“PHCL”) under a guarantee dated 7 October 2009 (the “PCG”). Both the loan and the PCG were governed by English law, and disputes under them were to be resolved by UNCITRAL arbitration in London.[4]
In December 2016, following financial difficulties within Palmali, the parties entered into the Termination and Settlement Deed (the “T&SD”). Mr Mansimov was personally a party to the T&SD and provided an indemnity covering failures or delays by Palmali companies in performing their obligations. The T&SD was governed by English law and provided for arbitration under the LMAA in London.[5]
The proceedings concerned three principal corporate restructurings. In April 2018, PHCL transferred its shareholdings in approximately 47 Maltese fleet-owning subsidiaries to a Turkish Palmali company. In June 2018, the shares in that Turkish company were transferred to another Turkish Palmali holding company then owned by Mr Mansimov. In February 2020, interests in the latter company and other Palmali companies were transferred to Mr Mansimov’s life partner, Ulviya Gasimova, and to GMM Investment Ventures SA, a company incorporated in St Kitts and Nevis. The parties did not dispute that the restructurings had occurred or that the assets had been transferred for little or no payment. Their disagreement concerned the value of those assets and the commercial reasons for the restructurings.[6]
The Defendants maintained that the corporate restructurings were legitimate responses to Palmali’s financial distress and pressure from Turkish lenders. They also argued that the 2020 corporate restructuring reflected the reputational consequences of the criminal proceedings against Mr Mansimov. The SOCAR Parties alleged that the corporate restructurings were intended to strip assets from the entities against which contractual and arbitral claims were being, or were about to be, pursued.[7]
The T&SD arbitration began on 18 May 2018, after the first restructuring in April 2018 but before the second in June. The PCG arbitration began on 20 June 2018, soon after the second restructuring. Both arbitrations had therefore been under way for some time when the further restructuring took place in 2020. In evidence submitted in the T&SD arbitration, Mr Mansimov stated: “I had no intention of performing the T&SD but needed the cash flow…”.[8]
The tribunal in the T&SD arbitration rendered its award on 26 January 2021, and the PCG tribunal followed on 3 February 2021 (together, the “English Awards”). A third award was made in the Dubai-seated arbitration, but the claims before the Court sought relief only in respect of the two English Awards. Apart from about GBP 107,000 paid towards costs, the awards remained unpaid. When these proceedings were issued, the claimants recorded approximately USD 307.4 million and GBP 730,000 as outstanding under the English Awards, including interest.[9]
The SOCAR Parties sought recognition and enforcement in Turkey, Malta and Azerbaijan, where their efforts were resisted. On 2 June 2025, they commenced the present proceedings and separate arbitration claims seeking permission to enforce the awards. Four days later, Jacobs J granted permission to serve the claim outside the jurisdiction. The present judgment concerns the Defendants’ application to set aside that order.[10]
The SOCAR Parties advanced three causes of action: the section 423 claim, the Marex claim and the conspiracy claim. For the conspiracy claim, SOCAR argued that the Defendants’ unlawful conduct was the same conduct already alleged in the section 423 and Marex claims.[11]
II. Issues
To retain permission to serve the Defendants outside England and Wales, the SOCAR Parties had to satisfy three cumulative requirements: first, each claim had to raise a “serious issue to be tried”, meaning a real and not “fanciful prospect of success”; second, there had to be a “good arguable case” that the claim fell within an applicable jurisdictional gateway; and third, England and Wales had to be “clearly or distinctly the appropriate forum” for the dispute.[12]
Against that background, the Court had to decide four main points. First, was there a real issue to try over whether the restructurings involved transfers at an undervalue made to put assets beyond creditors’ reach? Second, was the connection with England and Wales strong enough for section 423 to apply to foreign transfers? Third, could the “Marex tort” apply when the transfers took place months or years before the awards? Finally, did the surviving claims fall within the relevant jurisdictional gateways, and was England the proper place to hear them?[13]
III. Holding
To succeed on the section 423 claim at trial, the SOCAR Parties would have to show that the transfers were “at an undervalue”, meaning that no consideration was provided or that the consideration was “significantly less” than the value of the assets transferred; that one of the purposes behind the transfers was to place “assets beyond the reach of a creditor or otherwise prejudicing the interests of a creditor”; that the transfers caused or were capable of causing prejudice; that relief under sections 423 and 425 of the Insolvency Act 1986 was “appropriate”; and that there was a “sufficient connection” with England. At this stage, they only had to show a real, rather than “fanciful”, prospect of proving those matters.[14]
The Court held that the section 423 claim met that threshold. There were genuine factual disputes over the value of the transferred shares and the purpose of the restructurings. On the English connection, the Court relied on the fact that the relevant contracts were governed by English law and provided for London arbitration, and that those arrangements pre-dated the transfers. By the time of the later restructurings, one or both London arbitrations were already under way. On the claimants’ case, the transfers were therefore capable of being viewed as attempts to frustrate awards likely to be made in England.[15]
The Court reached a different conclusion on the Marex claim. It proceeded on the basis that the tort could in principle extend to arbitral awards, but held that the relevant award must already exist, or at least be “imminent” and known to the defendant, when the alleged interference occurs. Here, the last pleaded restructuring took place about eleven months before the first of the English Awards, and some of the earlier conduct pre-dated the arbitrations themselves. The claim therefore had no real prospect of success.[16]
Because the section 423 claim survived, the conspiracy claim also survived insofar as it relied upon the alleged section 423 conduct as its unlawful means. It could not proceed to the extent that it depended on the failed Marex claim. The Court was also satisfied that the remaining claims could properly be served outside the jurisdiction, and it concluded that England was clearly the most appropriate forum. Accordingly, the Defendants’ application was dismissed except in relation to the Marex claim.[17]
IV. Reasoning
It was common ground that the transfers were made for “no or nominal consideration”, meaning, broadly, that either nothing was given in return or the consideration stated for the transfer was not necessarily actually paid.[18] The real dispute was whether the shares themselves had any meaningful value. The Defendants said Palmali’s severe financial difficulties meant there was little or no equity left. The SOCAR Parties relied on accounting evidence suggesting otherwise, including an example where a company transferred for USD 1 million had been valued in Palmali’s own accounts at about USD 17 million.[19]
The Court did not try to resolve those competing valuations at this stage. That would have required a mini trial. It was enough that the evidence disclosed a genuine factual dispute over whether the transferred shares were worth more than the nominal consideration paid. The Court therefore held that the claimants had a real prospect of establishing an undervalue.[20]
Section 423 requires more than proof that a transfer happened to prejudice creditors. Placing assets beyond creditors’ reach must have been one of the transferor’s purposes. The Defendants maintained that the restructurings had been demanded by Palmali’s banks and were necessary to preserve the group’s operations.[21]
The Defendants’ explanation had evidential gaps. The Court was shown no contemporaneous documents recording the Turkish banks’ alleged demands, even though the restructurings were substantial. The explanation for the 2020 restructuring raised a further difficulty: the Defendants said Mr Mansimov could no longer remain a Palmali shareholder, yet they accepted that he remained the group’s “ultimate beneficial owner”.[22]
The mere fact that a debtor knows of pending or potential claims does not create a presumption of prohibited purpose. Nevertheless, the Court could consider such knowledge as part of the overall evidential picture. Here, the chronology of the restructurings, the absence of a fully documented commercial explanation, Mr Mansimov’s statement that he had never intended to perform the T&SD, and the alleged pattern of resisting enforcement collectively created a serious issue for trial. The Court did not find that the prohibited purpose had been proved; it held that the SOCAR Parties had a real prospect of proving it.[23]
Section 423 can reach transactions outside England and Wales, but only if the case has a “sufficient connection” with the jurisdiction. The Court stressed that this question must be examined carefully because section 423 can have wide “extra-territorial effect”.[24]
That connection did not arise simply because SOCAR later sought enforcement in England. It was already present when the restructurings took place. The T&SD and PCG were governed by English law and provided for London arbitration. The April 2018 restructuring occurred shortly before the arbitrations began; by June, the T&SD arbitration was under way, and the PCG arbitration was imminent; and by February 2020 both had been running for some time.[25]
That timing mattered. Unlike Orexim Trading, where the English connection arose only after the challenged transaction, the relevant English-law contracts and London arbitration agreements here were already in place before the restructurings. The Court considered the case closer to Dornoch and Integral Petroleum and held that, if the transfers were made to put assets beyond SOCAR’s reach, they could be treated as attempts to “frustrate” awards likely to be made in English arbitrations.[26]
The ruling does not establish that every London-seated arbitration automatically permits section 423 proceedings against foreign transferees. The Court repeatedly emphasised that sufficient connection depends on all the circumstances. Here, however, the combination of English governing law, agreed London seats, the timing of the restructurings and their alleged enforcement-defeating purpose was enough.[27]
The Marex tort concerns deliberate third-party interference with rights under a judgment. Its logic is similar to inducing a breach of contract: once contractual rights have merged into a judgment, the law can still protect them from intentional interference by third parties.[28]
That analogy also limits the tort. Its elements require an existing judgment, a breach of rights under that judgment, the defendant’s involvement in bringing about that infringement, knowledge of the judgment and an appreciation that the induced conduct will violate those rights. The parties accepted that the same tort could apply to arbitral awards, and the Court proceeded on that basis. Accordingly, the rights created by the arbitral award had to exist at the time of the alleged interference.[29]
The final pleaded restructuring occurred about eleven months before the first of the English Awards, and the earlier restructurings were even further removed from any award. That was very different from Marex, where the disputed conduct occurred around the time a draft judgment had already been circulated. The Court left open what might happen in a genuinely borderline case but held that these facts were not close.[30]
Before an award or judgment exists, the claimant’s rights remain contractual. The SOCAR Parties suggested during oral argument that the facts might support a claim for inducing a breach of contract, but no such claim had been pleaded, and no amendment was sought. The Court therefore did not decide whether that separate tort was available. That distinction was crucial: conduct that may have anticipated and frustrated a future award could not retrospectively amount to interference with rights under an award that did not yet exist.[31]
The Defendants’ only material objection to the conspiracy claim was that it depended upon the section 423 and Marex claims for the necessary unlawful means. Once the Court held that the section 423 claim raised a serious issue, the conspiracy claim necessarily survived to that extent. Conversely, it could not rely on the Marex claim, which had failed at the first jurisdictional stage.[32]
Jurisdiction was ultimately straightforward: the section 423 claim fell within the statutory gateway, and the related conspiracy claim could proceed on the basis of the same or closely connected facts.[33]
The Defendants emphasised that none of the parties was incorporated or domiciled in England, the restructurings involved Turkish and Maltese companies, relevant witnesses were located abroad, and the transfers were governed by foreign laws. The Court nevertheless considered England clearly the most appropriate forum because the purpose of the surviving claims was to obtain relief against alleged attempts to evade two English-seated awards arising from English-law contracts. Those awards had also been made enforceable as English judgments.[34]
The fact that the restructurings involved several countries did not point clearly to any one foreign court as the natural forum. The transfers concerned companies and interests in Turkey, Malta and St Kitts and Nevis, and Palmali itself operated an international shipping business across multiple jurisdictions. By contrast, the parties’ underlying legal relationship had a much clearer connection to England: it was governed by English law and provided for arbitration in London.[35]
Palmali’s own use of London arbitration also weakened its practical objections. In 2023, Palmali entities commenced the UML arbitration in London. That case involved document disclosure and live evidence from Mr Mansimov, Ms Gasimova and others, and the tribunal dismissed the claims in February 2026 as an “impermissible collateral attack” on the earlier awards. The Court relied on that history mainly to show that the parties were able to conduct substantial proceedings in England.[36]
The Court also noted that the Defendants had contested jurisdiction in Turkey, Malta and Azerbaijan when the SOCAR Parties sought enforcement there. That weakened their argument that Turkey was the proper forum and, in the Court’s view, reflected an obstructive approach to the awards.[37]
At the hearing, the Defendants offered to submit to the Turkish courts for claims “equivalent” to the section 423 claim, but the Court gave this little weight. The offer did not cover the conspiracy claim or future amendments and did not identify any equivalent Turkish “cause of action”, risking further disputes.[38]
The Court did not accept every consideration advanced in favour of England. It gave little weight to the parties’ English legal teams, accumulated knowledge or document repository. Its decision instead rested mainly on the dispute’s connection to English law and London arbitration.[39]
V. Conclusion
SOCAR v Mansimov demonstrates that choosing English law and a London seat may have consequences extending beyond the conventional recognition and enforcement of an award. Where foreign transfers are alleged to have been made to frustrate an existing or expected London award, those pre-existing English connections may be enough for the English court to consider a section 423 claim. The absence of English parties, English assets or English transfer documents is not, by itself, decisive.[40]
The judgment also clarifies the limits of the Marex tort. A creditor cannot rely on it simply because assets were moved before an award was made. On the facts of this case, the tort required an award or judgment to be in place, or at least imminent and known to the defendant, while leaving open the position in genuinely borderline cases immediately before judgment or award.[41]
The ruling is not a final decision on the merits. The SOCAR Parties have not yet proved that the restructurings involved valuable assets, that they were undertaken for a prohibited purpose or that final relief under section 423 should be granted. What they have established is the right to try those questions in England. Corporate structures may involve several countries, but that does not necessarily place disputes over London awards beyond the reach of the English courts.[42]
[1] The State Oil Company of the Republic of Azerbaijan and others v Mubariz Mansimov and others [2026] EWHC 2102 (Comm) [1]-[3], [17]-[19].
[2] Id. [55], [68]-[69], [83].
[3] Id. [21], [34], [55], [69], [82].
[4] Id. [1]-[4].
[5] Id. [5]-[6].
[6] Id. [3], [7]-[8], [11]-[12].
[7] Id. [8], [11]-[12], [29]-[34].
[8] Id. [9]-[10], [44]-[47].
[9] Id. [13]-[15], [48].
[10] Id. [14]-[18].
[11] Id. [17].
[12] Id. [19]-[21].
[13] Id. [22]-[23], [35]-[38], [61]-[68], [70]-[77], [78]-[82].
[14] Id. [21]-[24].
[15] Id. [28], [34], [44]-[50], [55].
[16] Id. [60]-[68].
[17] Id. [69]-[77], [82]-[83].
[18] Id. [8], [12], [25]; Chen v Ng [2017] UKPC 27, [45] (citing Midland Bank Trust Co Ltd v Green [1981] AC 513, 532D).
[19] SOCAR v Mansimov [2026] EWHC 2102 (Comm) [24]-[27].
[20] Id. [27]-[28].
[21] Id. [29].
[22] Id. [30]-[32].
[23] Id. [33]-[34].
[24] Id. [35]-[38].
[25] Id. [44]-[47].
[26] Id. [43]-[44], [46]-[47], [49]-[50].
[27] Id. [36]-[38], [46]-[50].
[28] Id. [57]-[60] (citing Marex Financial Ltd v Sevilleja [2017] EWHC 918 (Comm), [2017] 4 WLR 105 [17]-[28]; Lakatamia Shipping Co Ltd v Su [2021] EWHC 1907 (Comm) [120]-[126]).
[29] SOCAR v Mansimov [2026] EWHC 2102 (Comm) [59]-[62].
[30] Id. [61]-[65].
[31] Id. [64]-[68].
[32] Id. [69].
[33] Id. [70]-[77].
[34] Id. [78]-[80].
[35] Id. [80(i), (iv), (vi)-(vii)].
[36] Id. [16], [51]-[54], [80(iii)].
[37] Id. [80(viii)].
[38] Id. [81(i)-(iii)].
[39] Id. [80(xiii)].
[40] Id. [44]-[50], [80(i), (iv), (vi), (x)], [82].
[41] Id. [62]-[65], [68].
[42] Id. [28], [34], [50], [55], [82]-[83].
