2025-10-30 - CoA - Bhagat Textile Engineers v. Oerlikon Textile - UPC_CoA_8/2025

• If required, subject to the circumstances of the case and substantiated by compelling reasons, an application for security for costs may be filed after the summon for oral hearing has been issued. It shall nevertheless be requested before an award on costs has been decided by the Court pursuant to R. 150 RoP since the main purpose of a security for costs in the UPC system is to protect a party from a future risk of not being able to recover its legal costs that the other party may, pursuant to R. 158.1 RoP first sentence, be liable to bear. • The fact that, following an order of the Court of First Instance ordering the defendant to bear the costs, the Claimant, respondent in the appeal, has not yet received the corresponding payment from the defendant, is a matter of enforcement of the CFI order, and does not justify a request for security of costs in proceedings before the Court of Appeal with regard to these costs already awarded.

The Court of Appeal partially granted Oerlikon's application for security for costs against Bhagat, an Indian textile company. The court ordered €19,000 security for the appeal costs but rejected security for already-awarded CFI costs (€77,064.65), holding that non-payment of awarded costs is an enforcement matter, not a basis for security. The court established that security applications may be filed after the summons for oral hearing but must precede a costs award under R. 150 RoP. For appeal costs, legitimate concerns about recoverability were established based on Bhagat's financial difficulties and absence of bilateral enforcement agreements with India.