A decade-long Seoul vs Lone Star dispute to draw final ruling in 120 days
Korean Ministry of Justice said Wednesday that World Bank’s International Centre for Settlement of Investment Disputes (ICSID) has declared “discontinuance of proceeding” on the arbitration case between the Korean government and Lone Star Funds. With the declaration, ICSID will announce the final ruling as early as in 120 days, taking up to 180 days if special review is required.
The legal dispute began in November 2012 when Lone Star Funds made a filing with ICSID to request the Korean government to pay $4.7 billion for its losses related to its sale of a stake in Korea Exchange Bank (KEB). It claimed it suffered loss due to the Korean government’s delayed approval on the sale of its stake in KEB.
The Texas-based PEF acquired a 51.02 percent stake in KEB for 1.4 trillion won ($1.1 billion) in 2003. It signed a deal to sell the KEB stake to HSBC for 5.9 trillion won in 2007 but the deal fell through. The PEF later sold the stake to Hana Financial Group for 3.9 trillion won in 2012.
Lone Star claimed the deal with HSBC collapsed because the Korean government delayed approval. It also accused the Korean government pressured to lower the price and imposed unfair taxes on its deal with Hana Financial Group.
The Korean government denied the accusations made by Lone Star, saying authorities postponed approval as the PEF was involved in a criminal case on alleged stock price manipulation of former KEB unit. It contested price fell because the PEF was found guilty in the case and argued taxation was fair and reasonable.
The Korean government plans to take follow-up steps when arbitration decision is made, as it can file for cancellation of the ruling within 120 days upon ruling.
The case is important for the Korean government as the result will have an impact on other ICSID cases with foreign companies including Elliott Management, Mason Capital and Schindler Group.
[ⓒ Maeil Business Newspaper & mk.co.kr, All rights reserved]
Copyright© 매일경제 & mk.co.kr. 무단 전재, 재배포 및 AI학습 이용 금지
- A decade-long Seoul vs Lone Star dispute to draw final ruling in 120 days - Pulse by Maeil Business News Korea
- Korean big biz groups rethinking capex in US amid rising USD and interest rates - Pulse by Maeil Business News Korea
- Buyback and treasury retiring in fashion to survive bear market in Korea - Pulse by Maeil Business News Korea
- Single-living household in S. Korea to hit 40% in 2050, half lived be elderly - Pulse by Maeil Business News Korea
- Lotte Chemical to command capacity in four key solvents for lithium-ion battery - Pulse by Maeil Business News Korea
- 최민환-율희, 결혼 5년만 이혼…세 아이 육아는 아빠가
- 비트코인 낙수 효과…솔라나 한 달 200%↑[MONEY FINANCE]
- ‘사실상 열애’ 블핑 리사·재벌 2세, 파리가 만남의 광장? 이번엔 이강인 경기 관람[MK★이슈] -
- 이찬원, 이태원 참사에 "노래 못해요" 했다가 봉변 당했다
- ‘호흡곤란 실신’ 노유민, 직접 공개한 상태 “다행히…”