Software dispute threatens RBS trade finance Royal Bank of Scotland faces the possibility of having its global trade finance business effectively frozen by the courts, as a long-running legal row with its software supplier comes to a head. RBS has been in dispute for more than six years with Complex Systems, whose BankTrade software is widely used to support trade finance flows, including those of ABN Amro, acquired by RBS in 2007. A New York district judge ruled in June that RBS did not hold a valid licence for the software, following botched transfer agreements associated with the ABN takeover. A compensation ruling, or settlement, is likely to follow. But the real danger in the whole affair stems from an ancillary legal action, filed in October, according to which Complex Systems has asked the court to bar RBS from continuing to use the software. A judgment on the requested injunction is expected next month. Trade finance is one of RBS's core businesses, generating revenue of £226m in the first nine months of 2013. The removal of the software that underpins it could cause chaos with thousands of clients whose loans are hosted on it. For the part-nationalised British bank, the affair is yet another headache - and a further potential threat to its reputation. Retail customers in the UK were furious last month when a technology glitch led to a three-hour shutdown of cash points, point-of-sale systems and online banking services across the RBS network. During recent weeks, the bank has also been fined for benchmark interest rate setting abuses and sanctions breaches. It also lost its finance director to rival Santander after only 10 weeks in the job. Complex Systems, angry that the court action has dragged on for so long, accuses RBS of foot-dragging in a David and Goliath battle between a small software supplier and a large global bank. That characterisation may also evoke memories of two critical reports about RBS's treatment of small business customers - one official, by Sir Andrew Large, and one "self-commissioned" by disgruntled customer Lawrence Tomlinson. People familiar with RBS's legal arguments say the software company had been fanciful in its allegations, originally claiming so-called disgorgement damages amounting to more than $400m, based on the aggregate trade finance profits generated by RBS since 2007. The root of the affair was ABN's "poison pill" sale of US subsidiary LaSalle to Bank of America earlier in 2007 - an attempt by the Dutch bank to deter RBS from its attempt to buy what remained of ABN. But when RBS pressed ahead regardless, it failed to have the licence for the trade finance software transferred from LaSalle. Complex Systems says that, for more than a year, RBS and LaSalle, by then owned by Bank of America, were both using the software simultaneously with just one licence. RBS declined to comment.