China Herald: Ping An uses trade treaty to get Fortis compensation

Deal with a Chinese twist
via WikipediaFailling financial institutions worldwide have left many investors and savers scrambling for their money. Some of these efforts go well, like quite some European savers get their money back from the Icelandic bank Icesave, after European countries blocked an IMF-loan to Iceland as long as there was no deal in place.
Initially the UK came in as the most creative, by using anti-terrorism laws to block Icelandic assets in Europe.
But now the Chinese insurer Ping An is using a clause in the Chinese-Belgium trade treaty, that might make the Belgium government liable for the 15.7 billion Renminbi (1.8 billion euros) it lost on its investment in the insurance arm of the Fortis bank.
In short, first the Dutch government nationalized the Dutch part of the Fortis bank, followed by the Belgium government doing the same with the (larger) Belgium bank. The original listed holding kept then a rather smallish insurance operation that lost almost all its value on the stock exchange after trading resumed.
Fortis investors went to court in an effort to block the nationalization of their assets, but the court joined the argument of both governments and Fortis that without the nationalization nothing would have been left anyway.
According to Reuters:

The source familiar with the situation told Reuters Ping An believes the Belgian government's role in carving up Fortis along national lines last month is tantamount to confiscation and it wants to pursue compensation.
The source said China's Ministry of Commerce intended to deliver a note to the Belgian government and to submit a petition to the State Council, China's cabinet, seeking inter-agency support for its stance.

The Fortis headquarters is in Belgium, so that might explain why the Dutch are not in the legal frontline.
I'm quite sure that more international investors might be looking into the fine print of the trade treaties between countries. It might not help in the case of a default, like with Lehman Brothers, but when the government has nationalized assets or has become a majority share holder, we might see interesting times in court rooms.

Commercial
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