SEOUL, October 01 (AJP) - An international arbitration tribunal has reaffirmed South Korea's liability to U.S. investment firm Elliott Investment Management over government intervention in the controversial 2015 merger of Samsung C&T and Cheil Industries.
The remand tribunal ruled on Wednesday that the government's intervention in the merger vote was causally linked to losses suffered by Elliott, then a minority shareholder in Samsung C&T.
South Korea was ordered to pay Elliott about $48.49 million in damages, the same amount awarded in the original arbitration, plus interest. Elliott said the total amount now due, including damages, interest and legal and litigation costs, stands at about $113 million.
The dispute stems from the 2015 merger, when the National Pension Service, a major Samsung C&T shareholder, voted in favor of the deal. The tribunal previously ruled in June 2023 that the South Korean government had violated the Korea-U.S. Free Trade Agreement through its intervention in the NPS vote.
South Korea later challenged the award in a British court, which sent the case back to the tribunal to determine whether the government's conduct had caused Elliott's losses regardless of the NPS's legal status.
In its supplemental award, the tribunal concluded that the NPS would have voted against the merger without the government's intervention, according to Elliott.
Elliott welcomed the ruling and urged Seoul to accept the award, saying further delays would continue to increase the burden on South Korean taxpayers.
The Justice Ministry said it would closely analyze the ruling with relevant government agencies, outside experts and its legal representatives before deciding on further steps.
AJP Takeaways
- An international tribunal reaffirmed South Korea’s liability to Elliott over government intervention in the 2015 Samsung C&T-Cheil Industries merger.
- South Korea was ordered to pay about $48.49 million in damages, while Elliott says the total amount due with interest and legal costs is now about $113 million.
- The tribunal found that the National Pension Service would have opposed the merger without government intervention, strengthening Elliott’s claim that Seoul’s actions caused its losses.
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