India Refutes EU Sanctions Recognition, Nayara Energy Case in Delhi High Court
Indian Refiner Nayara Energy Seeks Court Ruling Against SAP Over Software Support Dispute
Mumbai: Nayara Energy Ltd, the Indian refiner backed by Russia's Rosneft, has argued in a Delhi court that SAP India's decision to cut off software support has left its operations vulnerable to cyber threats and defies India's refusal to recognize unilateral sanctions.
The dispute revolves around SAP's decision to suspend software services to Nayara Energy, citing European Union trade curbs. Nayara's counsel Dayan Krishnan argued that SAP is using the EU trade curbs to not provide its services to the energy firm despite contractual obligations in India. Nayara claims that being kept out of critical security updates and expert services prevents it from following government orders to strengthen infrastructure to withstand digital attacks.
The dispute serves as an instance for global tech vendors caught between Western measures and the local laws of countries. While SAP has stated that it must comply with German and EU law regardless of where services are delivered, Nayara argues that since the contracts are governed by Indian law and paid in Indian currency, the German software giant's attempt to bypass its commitments has no legal standing.
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Nayara's position is supported by the external affairs ministry, which has formally stated that the country does not subscribe to unilateral sanctions. With Nayara supplying 8.5% of India's energy, the court's decision will decide whether global software firms can be compelled to provide services to sanctioned entities when local national security is at stake.
Timeline of Events
| Date | Event |
|---|---|
| September 2025 | Nayara Energy filed a petition seeking restoration of key software services |
| July 2025 | SAP suspended software services to Nayara Energy |
| March 2025 | SAP argued in a hearing that they must comply with EU sanctions |
| 27 April | Next hearing in the case |
Nayara Energy was previously known as Essar Oil. According to Reuters, Rosneft has a 49.13% stake in Nayara Energy, and Kesani Enterprises Co. Ltd owns a similar stake. Rosneft is an oil and gas company based in Russia, which operates in all major Russian oil and gas provinces. Nayara has an oil refinery in Gujarat and operates more than 6,800 petrol pumps across the country.
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Investor Takeaway
India's refusal to recognize EU sanctions may lead to disputes between global tech vendors and local companies.
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