The government lost in the first trial of a lawsuit calling for the cancellation of an international arbitration ruling ordering it to compensate the U.S. private equity firm Mason $32 million (438 million won) related to the former Samsung C&T.
According to the Ministry of Justice on the 21st, the Singapore International Commercial Court ruled against the government in the first trial of a lawsuit it filed last April seeking to cancel a ruling by the Permanent Court of Arbitration (PCA) in the Netherlands.
Previously, Mason filed an investor-state dispute (ISD) lawsuit against the Korean government with the PCA in 2018. Mason held a 2.2% equity stake in Samsung C&T in 2015. However, when Samsung Group pushed for the merger by calculating one share of Samsung C&T as equal to 0.35 shares of Cheil Industries, Mason opposed the merger, claiming that they suffered losses. Nevertheless, the government pressured the National Pension Service, a major shareholder, to approve the merger, resulting in Mason filing the ISD, claiming they were harmed.
The PCA issued a partial ruling in favor of Mason last April. Although it did not reach the $200 million in damages that Mason requested, it ruled that the Korean government should compensate approximately $32 million along with delayed interest.
In response, the Ministry of Justice filed a lawsuit for cancellation of the arbitration ruling with the Singapore court, where the arbitration took place, in July of the same year. The Singapore court determined that there were no issues with the PCA's arbitration ruling.
The government is expected to appeal this ruling. The Singapore International Commercial Court allows appeals and higher courts in a three-tier system. The Ministry of Justice stated that it will "thoroughly analyze the ruling in cooperation with government representatives, law firms, and experts to prioritize national interests" regarding the ruling made on that day.