Honasa Consumer has clarified that there will be no attachment of its assets in the UAE as it has no assets there, on October 5. The Dubai Court had ordered such an action in its ongoing litigation with RSM General Trading LLC over the termination of distributorship.
In a filing on Saturday, the company said, “There shall be no attachment of the company assets, as the company has no assets located in the UAE.” Honasa Consumer General Trading LLC, a subsidiary of Honasa Consumer Ltd has been exempted from this order, it added.
The parent entity of Mamaearth, Honasa Consumer, last week informed the stock exchanges in India that the Court of Merits in Dubai has rejected the grievances filed by the company and its distributor in the Middle East and African region- RSM General Trading, and ordered to attach assets of Honasa Consumer in UAE along with refusal to cancel the trading license of Honasa Consumer General Trading LLC.
Dubai Court (on October 1) refused to cancel the trading license of Honasa Consumer General Trading LLC in Dubai, UAE on the grounds that it is a separate legal and financial entity and is not related to Honasa.
Further, Dubai Court ordered to attach Honasa’s assets in Dubai, UAE because of the 25 million AED (est. Rs 57 crore) compensation ordered by the Court of First Instance, Dubai.
RSM General Trading was Honasa’s distributor in the Middle East and African region between July 30, 2020 and January 17, 2023.
Read more: Dubai court rejects Honasa Consumer grievance filed over fiasco with UAE distributor
It is to be noted that Honasa Consumer had severed its ties with RSM General Trading a few months before its listing in the Indian market.
In July 2023, RSM General Trading LLC had filed a lawsuit in the Dubai Court for unlawful termination of its distributorship by Honasa Consumer Limited and had filed a precautionary attachment application against Honasa before the Court of Merits at Dubai for attaching assets of Honasa in UAE and cancellation of trading license of Honasa Consumer General Trading LLC.
Later, the Dubai Court on June 6, 2024, allowed to attach Honasa Consumer Limited’s assets in UAE, however, it refused to cancel the trading license of Honasa Consumer General Trading LLC.
Honasa Consumer Limited and RSM General Trading LLC filed their respective grievances against the said precautionary order.