SINGAPORE (ICIS)--Switzerland-based INEOS announced on Friday that it is taking legal action against Chinese petrochemical giant Sinopec and its subsidiaries over a breach of technology agreement and/or misuse of trade secrets related to acrylonitrile (ACN) production.
The Swiss firm is pursuing parallel actions in the Beijing High Court and through arbitration in Sweden, it said in a statement.
INEOS said that Sinopec Ningbo Engineering Company (SNEC) "has broken a long established technology agreement which, together with trade secret misuse by other Sinopec companies, has enabled development of series of new world scale ACN plants without INEOS agreement or consent".
These breaches of rights “will cause major harm to its ACN business”, which generates an annual profit of up to $500m annually for the company and has a replacement value of $3bn, the firm said.
“We have good and valuable relationships with Sinopec and other Chinese companies across our business. But in this case, we have to take action to protect the interests of our stakeholders, INEOS chairman Jim Ratcliffe said.
“The fundamental value of a business like INEOS depends on its intellectual property which includes trade secrets and patents, covering technology, design and operations. Unless we protect our intellectual property, ultimately we will see the demise of INEOS,” Ratcliffe said.
Sinopec could not be immediately reached for comment.