KUALA LUMPUR: The decision made by the Hague Court of Appeal on Tuesday, dismissing the Sulu claimants’ application for recognition and enforcement of a purported arbitral award of US$14.9 billion (RM62.59 billion) to be enforced in the Netherlands, confirmed Malaysia’s position that the sham arbitration should never have taken place.
Minister in the Prime Minister’s Department (Law and Institutional Reform) Datuk Seri Azalina Othman Said said such an application was illegitimate from the start and that the purported final award is null and void.
“To that end, the claimants cannot rely on the purported final award to attempt to seize Malaysian assets in the Netherlands and the landmark judgment will likely render futile any further illegitimate attempts by the claimants and their funders to enforce it in other jurisdictions,” she said in a statement today.
On Tuesday, Prime Minister Datuk Seri Anwar Ibrahim before departing home from Vientiane, Laos, announced the ruling by the Hague Court of Appeal in the Netherlands that dismissed the Sulu claimants’ application for recognition and enforcement of a purported arbitral award of US$14.9 billion (RM62.59 billion) to be enforced in the Netherlands.
The purported final award was issued by a Spanish arbitrator, Dr Gonzalo Stampa on Feb 28, 2022, to eight individuals claiming to be heirs of the Sulu Sultanate.
In their bid to enforce the US$14.9 billion final award, the Sulu claimants were reported to have attempted to seize Malaysia’s oil firm Petronas’ assets in Luxembourg, assets in the Netherlands and also targeted Malaysia’s diplomatic assets in France (including part of its embassy).
According to Azalina, the Hague Court of Appeal’s decision signified Malaysia’s achievement in its ongoing legal challenge to deprive the enforcement of the purported awards globally, which is a threat to the entire international arbitration system.
Simultaneously, the government of Malaysia has taken the necessary steps to obtain payment of the cost ordered against the claimants, following the Paris Court of Appeal’s decision on June 6, 2023, upholding Malaysia’s challenge against Dr Stampa’s ‘preliminary award’ on the jurisdiction, she said.
“The government shall ensure that the sovereignty, security and interest of Malaysia are protected and upheld at all times,” said Azalina.
She said such a decision was unequivocally made based on the three grounds which include no final award could have been lawfully rendered due to the annulment of Dr Stampa’s appointment as arbitrator by the same Spanish court that appointed him, which in turn invalidated all of his procedural acts.
“Thus no arbitral award exists that could be capable of recognition and enforcement. The arbitral tribunal was moreover not properly constituted since the appointment of Dr Stampa was annulled, which leads to the rejection of the claimants’ request,” she added.
The second ground is that since no valid arbitration agreement exists, no arbitration procedure could have legally taken place to begin with.
“It cannot be established that the parties intended to settle disputes by arbitration; even if they did, the alleged clause referred to by the claimants is, in any event, dysfunctional and cannot be relied upon,” said Azalina.
The final ground is that the exceptional stay of enforcement of the purported final award in Paris is a further ground for refusal which renders the sham award incapable of recognition and enforcement in the Netherlands. – BERNAMA
