Korea loses remand arbitration in Elliott ISDS case, ordered to pay $48.5 million
The tribunal found a causal link between the government's intervention in the approval of the Samsung C&T and Cheil Industries merger and the losses suffered by Elliott Management, a Samsung C&T shareholder at the time.
Cho A-ra, the director general for international investment disputes at the Ministry of Justice, speaks during a briefing on the annulment ruling in Korea’s investor-state dispute settlement case with U.S. private equity firm Elliott Management at the Government Complex Gwacheon in Gyeonggi on Feb. 24.
YONHAP
The Korean government has lost a remand arbitration in an investor-state dispute settlement (ISDS) case brought by U.S. private equity firm Elliott Management.
The remand arbitral tribunal ruled at around 7 p.m. on Wednesday that the government must pay Elliott Management approximately $48.49 million, plus interest for late payment, the Ministry of Justice said on Thursday.
The tribunal found a causal link between the government’s intervention in the approval of the 2015 merger of Samsung C&T and Cheil Industries and the losses suffered by Elliott Management, a Samsung C&T shareholder at the time.
The U.S. private equity filed the case in June 2018 under the Korea-U.S. FTA. It claimed that it suffered losses after the presidential office and the Ministry of Health and Welfare pressured the National Pension Service (NPS) to vote in favor of the merger.
The latest ruling came after a British high court partially set aside the original arbitration award in February — after finding that the NPS could not be regarded as a state organ — and remitted the case to the arbitral tribunal.
The remand tribunal, composed of the same three arbitrators as the original, found a causal link between the government’s intervention in the merger and Elliott’s losses, again holding the government liable for damages.
As a result, seven months after successfully having part of the original arbitral award set aside, the government once again faces compensation liability of the same amount as under the original award.
“We will closely analyze the ruling together with the relevant ministries, the law firms representing the government and outside experts and make every effort to take the necessary follow-up measures,” the Justice Ministry said.
BY CHO MUN-GYU [[email protected]]
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
