Elliott Investment Management ISDS: Government Loses Again in Remand Arbitration, Ordered to Pay 65.8 Billion Won

[Financial News] The South Korean government has lost again in remand arbitration proceedings in an investor-state dispute settlement (ISDS) case filed by Elliott Investment Management, which claimed it suffered losses because of the government’s intervention in the 2015 merger between Samsung C&T Corporation and Cheil Industries.
The government had the original arbitration award set aside by a UK court, sending the case back to the arbitral tribunal. However, the remand tribunal again found the government liable for damages.
The Ministry of Justice said on the 1st that the remand tribunal in the ISDS case filed by Elliott Investment Management in June 2018 issued an award at around 7 p.m. the previous day, Korea time, finding the South Korean government liable for damages.
According to the Ministry of Justice, the remand tribunal, composed of the same three arbitrators as the original arbitral tribunal, determined that there was a causal link between the South Korean government’s intervention in 2015 to support the merger of Samsung C&T Corporation and Cheil Industries and the losses suffered by Elliott Investment Management.
Accordingly, the tribunal ordered the government to pay Elliott Investment Management approximately $48.94 million, or approximately 65.85911 billion won, the same amount awarded in the original arbitration, along with interest for the delay and other costs.
The Ministry of Justice stated, "We will carefully analyze the award with relevant ministries, the law firm representing the government, and outside experts, and do our utmost to take any necessary follow-up measures."
The case arose from the National Pension Service’s exercise of voting rights during the 2015 merger between Samsung C&T Corporation and Cheil Industries. Elliott Investment Management filed an ISDS claim in June 2018, seeking more than 1 trillion won in damages, alleging that the South Korean government had improperly intervened in the merger process and caused losses.
In June 2023, the original arbitral tribunal partially upheld Elliott Investment Management’s claims and found the government liable for damages. At the time, the government’s total burden, including the principal amount and interest for the delay, was approximately 160 billion won.
In July of the same year, the government filed an action with a UK court to set aside the arbitration award. After the UK court accepted the government’s arguments in February this year, the original award was set aside and the case was remanded to the arbitral tribunal for a new hearing. However, the outcome was effectively unchanged in the remand arbitration.
 
[email protected] Choi Eun-sol Reporter