Case No: CFI 088/2025

IN THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF FIRST INSTANCE

BETWEEN

SKATTEFORVALTNINGEN
(the Danish Customs and Tax Administration)

Claimant

and

(1) ELYSIUM GLOBAL (DUBAI) LIMITED
(2) EMERALD INDUSTRIES L.L.C

Defendants

ORDER WITH REASONS OF H.E. JUSTICE MARK PELLING

UPON the Second Defendant's Application No. CFI-088-2025/2 dated 7 January 2026 seeking to challenge the DIFC Court's jurisdiction (the “Application”)

AND UPON hearing counsel for the Claimant and counsel for the Second Defendant at the Application hearing held before H.E. Justice Mark Pelling on 3 March 2026

IT IS HEREBY ORDERED THAT:

1. The Application is dismissed.

2. By no later than 4pm GST on 16 March 2026, the parties shall:

3. By no later than 4pm GST on 18 March 2026, the parties shall:

4. In default of the parties’ agreement in the terms set out in 3(ii) above, a hearing be fixed for the purpose of resolving all unagreed consequential matters to take place on the first date convenient to the parties in the week commencing 30 March 2026 or in default of agreement at 10am (GST) on 31 March 2026.

Issued by:
Hayley Norton
Assistant Registrar
Date of issue: 15 May 2026
At: 4pm

Introduction

1. This is the hearing of the Second Defendant’s application made pursuant to Rule 12.1 of the Rules of the DIFC Courts (“RDC”) for Orders declaring that the DIFC Courts do not have jurisdiction to hear this claim or should not exercise any jurisdiction that it has and that service be set aside on that ground.

2. By an order made by me prior to the start of the hearing, I directed that the application should be heard in private with any directions concerning the publication of the judgment that followed to be determined following circulation of this judgment in draft. My reasons for giving those directions are set out in a written judgment I delivered prior to the start of this hearing. I directed that publication of that judgment should be delayed until any application for the anonymisation of and/or redaction from this judgment had been determined.

Factual Background

3. The Claimant (“Skat”) is a Danish government controlled entity which assesses and collects taxes in Denmark. The First Defendant (“Elysium”) is a company registered in the DIFC, which it is alleged by Skat was founded and was at all material times and is controlled by Mr Sanjay Shah. The Second Defendant (“Emerald”) is a company incorporated in accordance with the laws of the State of Delaware in the United States of America and was founded and was at all material times and is controlled by Mr Masoud Mahmoudi.

4. Skat alleges that between 2012 and 2015 it was the victim of a fraudulent scheme conceived and carried into effect by Mr Shah and/or Solo Capital Partners LLP (“Solo”). A limited partnership founded and controlled by Mr Shah and/or others on behalf of Mr Shah. The scheme is the subject of a number of judgments of the Commercial Court and Court of Appeal of England and Wales and of the Supreme Court of the United Kingdom. In summary, Skat alleges that Mr Shah and/or Solo caused a very wide group of companies and other entities to submit withholding tax refund claims to Skat in respect of dividends paid by reference to shares not in fact owned by the claiming entities at the relevant time and/or in respect of tax that had not been imposed on those entities. Skat alleges that in consequence it suffered losses of about DDK 9 billion, the equivalent of approximately USD 1.4 billion. Skat has obtained judgment from the Dubai Court of Appeal against Elysium in the sum of approximately AED 1 billion on the basis that Elysium was one of the entities used to carry into effect the fraudulent scheme. An appeal from that judgment to the Court of Cassation failed. Skat also succeeded in its claims against Mr Shah and Solo

5. In these proceedings Skat alleges that Emerald received part of the proceeds of the part of the fraudulent scheme proceeds that Elysium received, knowing that the sums so received were the, or part of the, proceeds of the fraudulent scheme. Skat alleges that Emerald used the sums so received in order to purchase real estate in the state of Arizona in the United States of America (“Arizona properties”), which Skat maintains have (or had at the date of the Particulars of Claim) a combined value of in excess of USD 22m. Skat alleges that the Arizona properties are held by Emerald on constructive trust for Skat and on that basis seeks in these proceedings all appropriate orders necessary for the transfer to it of the Arizona properties.

6. This claim is therefore a claim against a non DIFC entity for orders which, if granted, will require it to transfer real estate located outside the DIFC to Skat, which as I have said is not a DIFC Body or Establishment. Skat maintains that this court has jurisdiction in relation to that claim in part at least by reason of the joinder of Elysium (which it is common ground is a DIFC Establishment) to these proceedings or its participation in the fraudulent scheme.

7. In order to understand and resolve Emerald’s jurisdiction challenge, it is necessary to descend into the detail of what is alleged by Skat since, aside from a submission that Skat’s claims concerning jurisdiction are wrong as a matter of law, Emerald also argues that they are bound to fail on the evidence because, even when tested by the relatively low evidential test that applies when considering a jurisdiction challenge, there is no evidence that sufficiently supports at a factual level the allegations that Skat makes. Even if all that is wrong, Emerald submits that I should nonetheless conclude that this court is not the proper forum applying the two stage test in The Spiliada [1987] AC 460 which applies to jurisdiction challenges in this jurisdiction – see Protiviti Member Firm (Middle East) Ltd v Al Mojil [2016] DIFC CA 003 at [32]. At the heart of that argument is the argument that this claim is or may be statute barred. I return to this at the end of this judgment to the extent that it is necessary to do so.

8. It is appropriate to consider how Skat puts its case against Emerald (at least initially) by reference to what Skat has alleged in its Particulars of Claim. The factual heart of Skat’s case is set out at paragraph 13 and following of the Particulars of Claim. In summary it is alleged that:

The Jurisdictional Gateways relied on by Skat

9. Skat’s pleaded jurisdiction case is at paragraph 4 of the Particulars of Claim, where it is asserted that this court as jurisdiction “… pursuant to DIFC Court Law (No 2 of 2023); Articles 14(A)(1) and (3) …” by reason of:

10. No attempt has been made to plead its alternative jurisdiction case advanced at the hearing that this court also or in any event has jurisdiction by operation of Article 14A (7) and RDC 20.7. Emerald relies on this as a bar to Skat relying on this ground. I reject that submission. I leave to one side whether it is necessary (as opposed to being merely desirable) for a claimant in DIFC Court proceedings to plead the jurisdictional basis it relies on. The issue as it arises in this case is one of law, the point does not come as a surprise to Emerald since it is addressed in the evidence and if necessary Skat applies for permission to amend its Particulars of Claim. If and to the extent it is necessary for all jurisdictional bases relied on to be pleaded, I would give permission to amend without hesitation. Skat is in my judgment entitled to rely on this ground as well as those referred to expressly in its Particulars of Claim either on the basis that the jurisdictional basis for a claim does not have to be pleaded or if it does permission would be granted.

The Jurisdictional Framework

11. Article (14) of the DIFC Courts Law No (2) of 2025 (“Courts law”) provides that:

Article (2) of the Courts Law defines “DIFC Bodies” and “DIFC Establishments” as being:

12. Article (14)A 7 of the Courts law provides that that DIFC Courts will also have jurisdiction to hear and determine “(c)laims … over which the DIFC Courts have jurisdiction under … DIFC Regulations...” Skat argues that the RDC are DIFC Regulations for this purpose. That is not in dispute and is in any event correct – see Nest Investments Holding SAL v. Deloitte & Touche (ME) [2018] DIFC CA 011 at [41]. Skat submits that accordingly this Court would have jurisdiction over Emerald in respect of this claim by operation of RDC 20.7, which provides:

13. Although on its face this provision is concerned with the addition of parties after the commencement of proceedings, it has been construed in this jurisdiction as conferring jurisdiction from the outset of a claim over persons and individuals who do not come within the scope of Article 14 A of the Courts Law but who would have been liable to be joined pursuant to RDC 20.7 following the commencement of the claim concerned – see Nest Investments Holding SAL v. Deloitte & Touche (ME) (ibid) at [58] to [59], followed in relation to the current version of the Courts Law in Thamer Abdulaziz Albulaihid v. Shehata [2023] DIFC 079 – as long as jurisdiction can be established over a defendant over whom the court has jurisdiction applying Article 14 A – a party referred to in the court’s jurisprudence as the “anchor” defendant.

14. This provision has the capacity to work unjustly by forcing companies and in particular individuals with no connection to the DIFC to litigate here against their will at significant expense and other obvious inconvenience. It creates the potential for the type of abuse referred to in Gulf Petrochem FZC LLC v. Petrochina International (Middle East) Company Ltd [2023] DIFC CFI 048 at [93] to [94]. As Chief Justice Wayne Martin observed in Sociedad De Inversiones y Desarrollo Playa Leona S.A. v. Gold Ca FZ LLC [2022] DIFC CFI 095:

This led the Chief Justice to warn judges of the need to scrutinise applications with particular care particularly so as to ensure that RDC 20.7 did not lead to an unprincipled expansion of the Court’s jurisdiction and to refuse jurisdiction in that case because he concluded that the claim was an “… attempt to use the long arm jurisdiction of the Court to bring before the Court parties not otherwise amenable to its jurisdiction for the purpose of resolving a dispute involving those parties.”

15. In order to keep the scope of this provision within principled restraint and to satisfy the requirement of desirability that is identified expressly in the Rule, it is necessary for a party relying on this gateway to demonstrate that there is between that party and the anchor defendant “… a real and live issue … which the court can reasonably ask the Court to try …” – see Gulf Petrochem FZC LLC v. Petrochina International (Middle East) Company Ltd (ibid.) at [114]. When carrying out this assessment the Court will examine the claimant’s claim against the anchor defendant in isolation, on the assumption that the defendant in respect of whom jurisdiction is asserted by reference to RDC 20.7 had not been joined. In this case, Skat relies on Elysium being the anchor defendant. In order to establish jurisdiction evidentially, it is common ground that Skat must establish a “ … plausible (albeit contested) evidential basis for the application of…” the gateway relied on – see Brownlie v FS Cairo (Nile Plaza) LLC [2018] 1 WLR 192 per Lord Sumption JSC at [7]. As is apparent from this formulation but also as is obvious, whether this requirement has been satisfied is not an opportunity and must not be permitted to become an opportunity for a mini trial on inevitably unsatisfactory evidence – see Lungowe v Vedanta Resources plc [2020] AC 1045 per Lord Briggs at [9]. As Lord Hamblen held in Okpabi and others v. Royal Dutch Shell plc and another [2021] UKSC 3; [2021] 1 WLR 1294 “(s)ave in cases where allegations of fact are demonstrably untrue or unsupportable, it is generally not appropriate for a defendant to dispute the facts alleged through evidence of its own. Doing so may well just show that there is a triable issue.” It was this reasoning that led the Court in Abraaj Investment Management Limited v. KPMG Lower Gulf Limited [2021] DIFC CFI 041 to caution against determining jurisdiction challenges based on evidential issues other than on the plausible evidential basis

Emerald’s Case in Summary

16. Emerald submits firstly that there is no jurisdiction under Art. 14 A (1) or (3) because there is no sufficient connection of the claim with the DIFC, secondly that Art 14 A (7) and RDC 20.7 does not confer jurisdiction either, because there is no sensible claim available to Skat against Elysium in these proceedings so the premise of Skat’s submission by reference to these provisions fails and thirdly, even if those submissions are wrong, the court should nonetheless decline jurisdiction on the ground that the DIFC Courts is not the appropriate forum in which to hear the claim. Emerald’s overarching submission at a factual level is that Skat has in any event failed to show a plausible evidential basis for the allegations that it makes against Emerald and therefore its jurisdiction case should fail on that basis too.

Discussion and Disposal

Article 14A (1)

17. Article 14A (1) confers jurisdiction on the Court in respect of civil or commercial claims (a) by or against the DIFC Bodies or DIFC Establishments and (b) to which DIFC Bodies or DIFC Establishments are party. It is unclear from the language or context and (so far as I am aware) it has not been decided whether it was intended that there should be two separate gateways embedded within Article 14 A (1). I am inclined to think it was since otherwise the words “… and those to which DIFC Bodies or DIFC Establishments are party…” would appear to be surplus or would render the narrower words that precede it pointless. However, I mention this point below only in passing and tentatively because it was not the subject of submissions to me.

18. Skat is Danish governmental entity, and Emerald is a Delaware registered corporation. Since neither Skat or Emerald are or are alleged to be DIFC Bodies or DIFC Establishments it necessarily follows that the Court has no jurisdiction by reference to the of the Art 17 A (1) gateway (or the first of those gateways) – see Dhawan v. Zurich International Life Limited [2025] DIFC CFI 019 per Justice Thomas Bathurst at [49]. Whilst it is true that Elysium is a company which was registered in the DIFC and as such is a DIFC Establishment, that does not assist for these purposes because the jurisdictional focus for present purposes is on the claim by Skat against Emerald. If there is only one gateway within Article 14A (1), and its effect is as I have described above in relation to the first Article 14A (1) gateway, then these conclusions mean that the claim to jurisdiction under Article 14A (1) must fail.

19. If there is a second gateway within Art14A (1) in the terms identified above, then it apparently confers jurisdiction on the Court in respect of any civil or commercial claims to which DIFC Bodies or DIFC Establishments are party and so is potentially rather wider in its scope than what I have called the first of the Article 14A (1) gateways. As noted by the Court in Nest Investments Holding SAL v. Deloitte & Touche (ME) (ibid.) at [38], the textual effect of this provision is that as long as “… one of the parties to the claim or action in question is the DIFC itself or any DIFC Body, DIFC Establishment or Licensed DIFC Establishment, jurisdiction exists if the claim is civil or commercial. It matters not whether the party is claimant, defendant or third party.” However, it cannot have been intended to confer jurisdiction on the DIFC Courts in respect of any non DIFC party who is joined to a claim in which some other party (whether claimant, a defendant or third party) is a DIFC Body or Establishment, not least because (i) it would render the first gateway within Article 14A (1) otiose, (ii) it would give rise to all the abusive long arm difficulties identified by Mr Walsh KC in his submissions and by Chief Justice Martin in Sociedad De Inversiones Y Desarrollo Playa Leona S.A. v. Gold Ca FZ LLC (ibid.) in relation to Art 14A (7) and RDC 20.7 and would create the potential for the type of abuse referred to in Gulf Petrochem FZC LLC v. Petrochina International (Middle East) Company Ltd (ibid.) at [93] to [94] and (iii) it would also render it unnecessary for RDC 20.7 to be construed as it has been or would render that provision otiose as well, unless the applicability of that rule was confined to applications to join parties after the commencement of proceedings (as is the case with the equivalent rule in the Civil Procedure Rules that apply in England and Wales).

20. In those circumstances, if what I have called the second gateway within Article 14A (1) was intended to be a separate gateway, then in my judgment it should be read down as qualified in the same manner as that identified in Gulf Petrochem FZC LLC v. Petrochina International (Middle East) Company Ltd (ibid) in relation to jurisdiction claims advanced by reference to Art 14A (7) and RDC 20.7 for exactly the same reasons.

21. As will be apparent from what I have said so far:

The Issues between Skat and Elysium

22. As noted already, resolving whether there is a real issue between Skat and Elysium involves analysing Skat’s claim against Elysium in these proceedings in isolation, on the assumption that the defendant in respect of whom jurisdiction is asserted by reference to RDC 20.7 had not been joined.

23. Emerald submits that Skat is not entitled to rely on Art 14A (7) and RDC 20.7 because there is no plausible evidential basis for saying that there is a real and live issue between Skat and Elysium (as anchor defendant) which it can reasonably ask the court to try. Given that this exercise involves analysing Skat’s claim against Elysium in these proceedings in isolation, it is worth keeping squarely in mind throughout whether these proceedings would plausibly have been commenced only against Elysium. In that regard it is material to note that:

24. Against that background, the first point that is made on behalf of Emerald is that no proper claim has been pleaded by Skat against Elysium. If that is correct, then supports a conclusion that Emerald is right in its submission that the onshore Dubai proceedings represent a complete adjudication of Skat’s claims against Elysium. The sole focus of attention for present purposes is on what is pleaded by Skat against Elysium in the Particulars of Claim. As to that

The Prayer in the Particulars of Claim is in these terms:

25. In a common law jurisdiction, pleadings play a critical part in the conduct of litigation because they establish the issues between the parties and set the agenda for disclosure, the topics (if any) to be covered by expert evidence and witness statements and the issues that are either agreed or will have to be determined by the judge at trial. Where the factual allegations the claimant makes are relevant for determination of an interlocutory application (as for example with jurisdiction challenges and summary judgment or strike out applications) it can safely be assumed that the claimant will have stated its claim in the strongest permissible terms in its Particulars of Claim. That being so, when considering a jurisdiction challenge the primarily relevant document will be the Particulars of Claim (or a draft amended Particulars of Claim if there is a pending application to amend). Different considerations may apply where all that is available is a Claim Form because the brief details of claim that appear in that document may not set out at all clearly what is being claimed against each party and on what basis.

26. As I have explained no cause of action of any sort has been pleaded by Skat against Elysium in its Particulars of Claim, nor has any remedy been claimed against it. There can be no sensible dispute about this for the reasons explained above and it has been conceded in substance by Mr Crosse, Skat’s solicitor, at paragraph 39.3 of his first statement where he states that “… the purpose of the present claim is asset recovery rather than liability. The liability of the EGDL has been established and SKAT does not seek to relitigate that issue.” It follows that although in paragraph 39.1, Mr Crosse says that “… if Elysium wishes to advance arguments of res judicata that is a matter for EGDL not Emerald…” that point is nevertheless conceded in effect in paragraph 39.3. Mr Crosse expands upon this issue at paragraph 39.2, where he states:

27. This misses the points that are relevant for present purposes because it ignores that none of the relief and remedies that Mr Crosse refers to are claimed by Skat from or against Elysium. The remedies are different from those claimed against Elysium in the onshore Dubai proceedings but that is not to the point because no further or other remedies are being claimed by Skat against Elysium in these proceedings.

28. Mr Crosse addresses the jurisdictional claim made by reference to Articles 14A (7) and RDC 20.7 at paragraphs 40 – 42 but the material set out there in my judgment also misses the point that arises. As I have explained what has to be decided is whether there is a “… a real and live issue between [Skat] and [Elysium] which the claimant can reasonably ask the Court to try”. This part of Mr Crosse’s evidence focuses exclusively on why it would be desirable to permit the claim against Emerald to proceed. That is the wrong question, which is that I identify above. Mr Crosse makes no attempt to address that issue, which is unsurprising given (i) what he fairly sets out in paragraph 39 of his statement; (ii) that Skat has secured a full judgment against Elysium concerning what it calls in the Particulars of Claim in these proceedings the “Shah fraud”; (iii) there is between Elysium and Skat at least an issue estoppel concerning those allegations; and (iv) Elysium is apparently no longer operating as a going concern.

29. I return to the Chief Justice Martin’s warning in his judgment in Sociedad De Inversiones y Desarrollo Playa Leona S.A. v. Gold Ca FZ LLC (ibid) of the need to scrutinise with particular care claims to jurisdiction founded on Articles 14A (7) and RDC 20.7, a warning with which I respectfully agree for all the reasons identified earlier. For those reasons I have set out above, I accept Emerald’s submission that Skat has not shown that there is a real and live issue between Skat and Elysium which Skat can reasonably ask the Court to try and for that reason Skat’s reliance on Article 14A (7) and RDC 20.7 (and the second gateway in Article 14A (1) if on proper analysis there is such a gateway) for the purpose of establishing jurisdiction against Emerald fails. It follows that Skat must succeed in establishing jurisdiction using the Article 14A (3) gateway if it is to defeat Emerald’s application.

Article 14A (3)

30. This gateway is concerned with civil or commercial claims arising out of or related to any incident or transaction relevant to any DIFC Bodies or DIFC Establishments, that have taken place, wholly or partly, within the DIFC. As Mr Walsh submitted, for a claim to pass through this gateway it must be shown:

31. Although in other contexts the phrase “… arising out of or related to …” would be construed as having a wide effect, in this context, the words “… related to …” have been interpreted to mean only that the incident or transaction relied on “…should have been in furtherance of or as a result of a particular commercial activity carried on in the DIFC …” – see Al Khorafi and others v. Bank Sarasin – Alpen (ME) Ltd and another (ibid) at [64]. The phrase “…arising out of…” when used in this context is unlikely to be of any wider effect. Consistently with this approach, an “incident” was defined in Al Khorafi as being:

32. Whilst an allegation that in the events that have happened assets are held on constructive trust for the claimant is not a tortious claim, the analysis when considering jurisdiction in respect of such a claim by reference the Article 14A (3) gateway will be similar, with an “incident” being any of the essential elements of conduct leading to the claim that assets are held on constructive trust. The “transaction” concept was defined in the same case as being:

33. The words “… relevant to the DIFC Bodies or DIFC Establishments, their own activities, or those related to the activities of the employees in any of them…” are to be construed as making clear that “… the incident or transaction even if it takes place within the DIFC must have a connection to the DIFC Bodies or DIFC Establishments involved in the claim or the activities of their employees.” – see Dhawan v. Zurich International Life Limited [2025] DIFC CFI 019 at [60]. In the context of this claim, what is required therefore is that one of the essential elements of conduct leading to the claim that the Arizona properties are held on constructive trust for Skat (i) occurred within the DIFC and (ii) was connected to Elysium.

34. Skat asserts at paragraph 42 of its skeleton submissions, that the claim against Emerald “… arises in whole or in part from monies transferred to and from [Elysium]. If SKAT is correct in its assertions, the money that is the subject matter of the claim was transferred to and from [Elysium], which is a DIFC Establishment…” This reflects almost word for word what Mr Crosse states at paragraph 38 of his first statement. Skat acknowledges (at least implicitly) that there is no evidence that monies were received by Emerald directly from Elysium. Its case is that monies coming from Elysium were paid to Syscon and ARIG and then by those entities to Emerald.

35. Emerald’s case is that the only payments that Skat can rely on are the payments by Syscon and ARIG, neither of which are DIFC Bodies or Establishments and that there is no plausible evidential basis for concluding that any payment by either of them to Emerald occurred within the DIFC. Skat maintains that all this is immaterial because the payments from Elysium to Syscon and ARIG and from each of those entities to Emerald were a series of causally linked debits and credits and should be treated for jurisdictional purposes as an unbroken whole. Skat’s case is that these causally linked payments started with a transfer or transfers by Elysium that took place or were authorised from within the DIFC and was or were thereby connected to Elysium as the paying party. Skat submits therefore that this court has jurisdiction to determine its tracing claim against Emerald because that claim is a civil or commercial claim that arises out of or is related to an incident or transaction (the payment by Elysium to Syscon and ARIG) which took place wholly or partly in the DIFC that was connected to a DIFC Establishment. Emerald submits that this analysis should be rejected because neither Syscon and ARIG are either DIFC Bodies or Establishments or parties to this claim. It is submitted that Skat’s pleaded case that the claim “… arises in whole or in part from monies transferred to and from EGDL in the DIFC …” ignores that critical fact and is misleading because it obscures the fact that Emerald had no dealings with Elysium.

36. I accept (indeed it is not in dispute) that neither Syscon or ARIG are or were DIFC Establishments. Both are in liquidation. I accept that is why those entities were not joined to the onshore proceedings and why they joining them to these proceedings would serve no useful purpose and would simply add needlessly to the cost and complexity of these proceedings. I also accept that the funds transferred by each to Emerald were made by an onshore Dubai based bank. I accept therefore that viewed in isolation the payments by Syscon and ARIG to Emerald were not incidents which occurred within the DIFC. If that was the only true focus of attention, I would have accepted Emerald’s submission that jurisdiction had not been established by reference to the Article 14A (3) gateway. However, I do not accept that Skat’s case should be confined in that way. It is both unrealistically and artificially narrow and fails to reflect the conventional way of analysing tracing claims of this nature.

37. On Skat’s case these payments were part of a single fraudulent scheme in which funds illicitly obtained from Skat were transferred first to Elysium and then by Elysium to Syscon and ARIG and from each of those entities to Emerald. If it can be proved either as a matter of primary fact or inferentially that the sums paid to Syscon and ARIG were sums or part of sums received by Elysium as part of the Shah Fraud Proceeds and that those sums were then paid by Syscon and ARIG to Emerald – and subject of course to it being proved that all recipients had the necessary knowledge of the source of the funds – then I do not see why it would be appropriate to break up the chain of payments in the way that Emerald contends should be adopted unless such an approach was required by conventional tracing rules. This is a tracing claim and the principles that apply to such claims do not require or even permit such an approach. The focus of attention in such claims is on whether the various payments down the chain were causally and transactionally linked so as (in this case) to enable the sums credited to Emerald’s accounts to be taken as representing the sums debited from Elysium’s accounts – see Lord Millet’s well known summary of the principles relating to the tracing of money in Foskett v McKeown [2001] 1 AC 102 at 128.

38. Returning to Article 14A (3), if this analysis is adopted then the payments that ended up being received by Emerald were received by it as a result of a series of linked transactions or incidents. Those linked transactions or incidents were relevant to a DIFC Establishment because the entity that initiated the payments that on Skat’s case passed ultimately to Emerald was Elysium, which (as is common ground) was at all material times and is a DIFC Establishment. Furthermore, the incidents or transactions took place in part in the DIFC on this analysis because Elysium was established there and the payments from it down the chain were authorised by it or on its behalf. As a matter of law therefore, I conclude that if there is a sufficiently plausible evidential basis for the core allegations made by Skat, that would be sufficient to found jurisdiction under the Article 14A (3) gateway.

39. It remains to consider whether the claimant has established a sufficiently plausible evidential basis a claim on this basis. As I said earlier in this judgment investigating this issue is not a mini trial. The applicable test is whether there is a plausible (albeit contested) evidential basis for the application of the gateway. Emerald’s submissions in summary are:

40. There are some elements of Emerald’s case that I can leave to one side. It is asserted that Skat’s assertions regarding Syscon and ARIG’s alleged receipt of proceeds constitute improper accusations of fraud against non-parties to the present claim. This is entirely artificial. Both are corporate entities in liquidation. There is no obligation on Skat to join companies in liquidation that are alleged to have been conduits of allegedly fraudulently obtained funds in order to advance a claim against alleged ultimate recipient of the alleged fraudulently obtained funds any more than there is an obligation to join all parties alleged to have been parties to an unlawful means conspiracy.

41. Similarly, I consider that attempting to resolve what inferences are to be drawn from the primary facts relied on by Skat are issues that should be resolved at trial. To do otherwise would be to embark erroneously on a mini trial, not to determine whether there is a “… plausible (albeit contested) evidential basis for the application of…” the gateway provided by Article 14A (3). Had it been contended that the inferences that Skat seeks to rely on could not be drawn by a court determining its claim at a trial and that there was no other evidence to consider that would be a potential challenge available to Emerald. However, that was not the submission made and no authority either of this court or any other supporting such a proposition was cited. Emerald’s real point is that the payments it received were for bona fide commercial transactions and that once that was understood the sub stratum for drawing the inferences that Skat seeks to draw was swept away.

42. If Emerald is to succeed on that basis it would have to establish that case to a standard that would justify summary judgment in its favour. If that is not the effect of the material it deploys then, as Lord Hamblen said in Okpabi and others v. Royal Dutch Shell plc and another (ibid.), the material simply shows there is a triable issue to be determined. In considering this point it is necessary to note that there has been no disclosure exercise carried out nor has any relevant witness been cross examined. It therefore does not assist that Dr Ahmad says in paragraph 15.1 of his second statement that Skat “… has produced no documentary evidence, no bank statements, no wire transfer records, no financial ledgers, and no forensic accounting evidence tracing the alleged flow of funds from the First Defendant through Syscon and/or ARIG to the Second Defendant…”.

43. I turn now to the evidence on which Emerald relies. Its case is that it received funds from Syscon and ARIG as payments due under legitimate commercial arrangements entered into in furtherance of a distribution agreement between Emerald and Syscon dated 4 June 2013 by which Syscon was apparently appointed as distributer by Emerald of its cigarettes and non-tobacco products. It maintains that the funds received from ARIG were paid under instructions to it from Syscon.

44. Emerald relies on bank statements that show payments being made to it from each of Syscon and ARIG. In my judgment those provide no assistance in resolving the issues that rise since it is not in dispute that the payments were made. The description of the purposes of the payments in the bank statements do not assist either, both because they are self-serving on Skat’s thesis and because they are so generic as to prevent any conclusions being drawn from them. There is reference to some customs material that may evidence the transfer of some goods into the UAE and some payments from Emerald to Syscon that are said to be in respect of promoting Emerald’s products. None of this material whether examined separately or collectively leads to the conclusion that Skat has failed to establish a plausible evidential basis for its claim, much less would it entitle Emerald to summary judgment against Skat. All that the material establishes is that Skat’s case is contested. Further, there is no satisfactory explanation as to why ARIG was making payments on behalf of Syscon. The reality of this is that until there has been a trial it is impossible to reach any final conclusions on whether what Emerald says is correct or not. This will require a very careful evaluation of when and in what circumstances the distribution agreement was entered into, why it was entered into, whether there is documentation that establishes trading between Emerald and Syscon of the value reflected by the transfers and why ARIG was making payments on behalf of Syscon. The use of the funds received to purchase the Arizona properties will also require a very careful, evaluation.

45. Emerald argues that for Skat to succeed under Article 14A (3), it must establish each link in the following chain namely that: (i) Elysium received specific Shah Fraud Proceeds; (ii) Elysium transferred those specific proceeds to Syscon and/or ARIG; (iii) Syscon and/or ARIG transferred those same proceeds to the Second Defendant; and (iv) the monies received by Emerald are traceable to the Shah Fraud – see paragraph 15.2 of Dr Ahamd’s second statement. It is accepted at least implicitly that there is sufficient evidence available to prove (i), but that there is no evidence for links (ii) and (iii). I do not accept that is so. I accept Skat’s submission that if its pleaded case was uncontested at trial, it is realistic to suppose that a court could be persuaded to draw the inferences that Skat invites as set out in its pleaded case. If, as appears likely, Skat’s case is challenged at a trial, then whether such inferences are drawn will depend on the evidential evaluation referred to above.

46. In those circumstances, I am satisfied that Skat has established jurisdiction under the Article 14A (3) gateway.

Forum Non Conveniens

47. Emerald submits that if I reached the conclusion that Skat was entitled to succeed under any of the gateways that it relied on then in any event this court should decline jurisdiction adopting the two stage test in The Spiliada (ibid.). In order to succeed in that submission, Emerald must show that there is a forum that is clearly and distinctly more appropriate than the DIFC. This usually engages an evaluation taking account of a number of practical and legal issues.

48. Emerald submits that given that Skat’s claim is against a Delaware corporation carrying on business in the United States in relation to real estate that ostensibly it owns located in Arizona, the courts of either of those states are the clearly and distinctly more appropriate jurisdiction for this claim to be heard. Emerald submits that the justification for this conclusion is all the stronger because there are no assets which Skat seeks to recover that are located within the DIFC and neither Skat or Emerald has any connection with or presence in the DIFC. The only connection with the DIFC is Elysium and the claim against it is entirely illusory.

49. Emerald alleges that one of the reasons why Skat may be attempting to bring proceedings in this court is because any claim it might otherwise have brought in either Delaware or Arizona is or is likely to be statute barred. The detail concerning this issue has been set out by Mr Walsh in his skeleton argument and I need not repeat it. The point that is made on behalf of Emerald is that Skat should not be permitted to use the DIFC Courts to escape limitation rules in other jurisdictions.

50. In my judgment Emerald’s approach is mistaken. If and to the extent a claim over which this court would have jurisdiction is statute barred in the other jurisdiction or jurisdictions relied on by the party challenging jurisdiction, it is difficult to see how sensibly it could be concluded that the alternative jurisdiction relied on is clearly and distinctly more appropriate. Whilst this is not an absolute answer it is likely to be a very powerful factor in the evaluation exercise if there is no other available jurisdiction in which the party resisting a jurisdiction challenge can bring its claim. As Lord Goff put in The Spiliada (ibid.) at 487A-B “…it cannot be in the interests of the parties or in the interests of justice that the action should effectively be remitted to a forum which cannot be described as appropriate for the trial of the action”. As he added at B-C the “… point is simply that the shipowners claim is not time barred in England but may be treated as time barred in British Columbia…”.

51. Here it is not suggested that Skat’s claim against Emerald became statute barred in the period since the commencement of the proceedings in this court nor that Skatt has acted unreasonably in failing to commence proceedings against Emerald during what is said to be the limitation period that applied in Delaware and Arizona. Had Emerald been concerned simply to ensure that the claim that Skatt wished to bring against it should be litigated in the courts of either of those states on grounds of practical convenience, it could and should have offered an unconditional waiver of its right to rely on any applicable time bar – see The Spiliada (ibid) at 487C.

52. Aside from this point, the location of the real estate into which Skat seeks to trace is a factor of limited weight since the claim will depend on the evaluation of evidence in relation to the payments and the transactions to which those payments are said by Emerald to relate. Nothing significant will turn on where the land is located with no issues of Arizona real estate law having been identified as relevant to the dispute.

53. I fully accept that there will be significant cost and inconvenience in litigating the issues that arise in the DIFC Courts rather than Delaware or Arizona and I make clear I would have considered those factors as ones justifying staying these proceedings in favour of proceedings either in Delaware or Arizona but for the limitation issue. In those circumstances, I would have adopted Lord Goff’s approach in The Spiliada (ibid) at 487H-488A and would have declined jurisdiction on condition that Emerald showed (i) it could effectively waive and (ii) in fact it waived its right to rely on the time bar that applied in Delaware and Arizona. However, no evidence has been led that suggests such a waiver would be legally enforceable in either jurisdiction and in any event no such waiver has been offered. To the contrary, Emerald’s submissions make clear that it relies on the existence of such a bar (erroneously in my judgment) as something it is entitled to rely on in determining the forum non conveniens issue.

54. Absent such a waiver, the risk that a time bar will apply to any claim brought in in Delaware or Arizona outweighs the other factors I have referred to above in assessing whether Emerald has shown there is an alternative forum that is clearly and distinctly more appropriate than the DIFC Courts. It follows that Emerald has failed to show that there is a forum that is clearly and distinctly more appropriate that the DIFC.

Conclusion

55. For the reasons set out above, Emerald’s jurisdictional challenge is dismissed.

Directions

56. I direct that: