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[Alpha Biz=(Chicago) Reporter Kim Jisun] The government has decided to file for cancellation in defiance of the International Court of Permanent Arbitration's ruling that the U.S. private equity fund Elliott should pay about 130 billion won.
The Ministry of Justice said on the 18th that it has submitted an application to the arbitration government for correction and interpretation of the ruling on the investor-state international arbitration (ISDS) case with hedge fund Elliott Management and filed a cancellation suit with the British Court.
The Justice Ministry explained that it decided to take steps to disobey the ISDS's ruling after confirming that there were clear computational errors and unclear judgments by the arbitral tribunal.
Elliott, a former shareholder of Samsung C&T, filed a lawsuit in July 2018, saying that Cheong Wa Dae and the Ministry of Health and Welfare suffered huge losses by pressuring the National Pension Service to vote during the merger between Samsung C&T and Cheil Industries in 2015.
On the 20th of last month, the Arbitral Tribunal decided to reimburse the Korean government for 53,586,931 dollars (69 billion won). Adding interest and legal costs, the amount of compensation amounts to 130 billion won.
In response, the Ministry of Justice claimed that the arbitration court misinterpreted the requirements for recognition of jurisdiction under the Korea-U.S. FTA, saying the National Pension Service's approval of the merger cannot be seen as an exercise of pressure on other minority shareholders, nor can the National Pension Service be seen as a state agency.
According to the Ministry of Justice, it is a great principle and common sense under commercial law that minority shareholders do not bear any responsibility to other minority shareholders for exercising their voting rights.
Therefore, the National Pension Service, one of the many minority shareholders of Samsung C&T, cannot be seen as a step against the investment of Elliott, another minority shareholder.
AlphaBIZ 김지선(stockmk2020@alphabiz.co.kr)
