South Korea has secured a partial victory in a legal challenge to a long-running arbitration ruling stemming from the 2015 Samsung merger dispute with US hedge fund Elliott, after the High Court in London overturned part of a $100m-plus arbitral award, according to a report by Reuters.
The award was originally granted in 2023 by the Permanent Court of Arbitration, which found in favour of Elliott after the hedge fund challenged the role played by South Korea’s National Pension Service in approving the merger of Samsung C&T and Cheil Industries – a deal it opposed as a minority shareholder.
Judge David Foxton ruled that the pension fund’s decision to vote in favour of the merger could not be attributed to the South Korean state under international law, partially setting aside the arbitration tribunal’s findings on jurisdiction.
However, the court stopped short of annulling the entire award. Elliott’s separate claims relating to actions taken by the administration of former president Park Geun-hye will now be sent back to the arbitration tribunal for reconsideration.
South Korea’s justice ministry described the ruling as a “valuable victory”, arguing it reinforces limits on when state liability can be imposed in investor-state disputes.
Elliott, meanwhile, said it had successfully defended the bulk of its arbitration award, warning that South Korea’s continued refusal to pay would increase costs for taxpayers as interest continues to accrue.
