South Korea has emerged victorious in an international arbitration dispute brought by Swiss elevator giant Schindler Holding AG, averting a potential payout of 320 billion won (approximately $211.4 million) in damages, according to the Justice Ministry on Saturday.
During a press conference held at the government complex in Seoul, Justice Minister Jung Sung-ho announced that the Permanent Court of Arbitration (PCA) in The Hague had dismissed all of Schindler’s claims in a ruling issued early Saturday, including the significant 320 billion won damages claim. Furthermore, South Korea will recover around 9.6 billion won in legal costs.
“This marks a complete victory for the Republic of Korea,” stated the minister, referring to South Korea by its official name.
Schindler initiated the lawsuit in 2018, alleging that the South Korean government failed to adequately oversee and regulate capital increases by Hyundai Elevator Co. between 2013 and 2015.
The Swiss company, then the second-largest shareholder in Hyundai Elevator, contended that these capital increases were primarily intended to assist Hyundai Group in maintaining control over its affiliates, notably Hyundai Merchant Marine, rather than serving legitimate business purposes.
Schindler asserted that it suffered financial losses as a result of the government’s alleged oversight failures. Initially, the company sought approximately 500 billion won in damages before reducing the claim to around 320 billion won.
On Saturday, the arbitration tribunal concluded that Seoul acted within its legal bounds and conducted sufficient investigations at the time. The court found no violation of the government’s investment treaty obligations and rejected the argument that the state should be held liable for the losses under international law.
President Lee Jae Myung celebrated South Korea’s legal triumph in a social media post later in the day, emphasizing that it helped protect South Korean taxpayers’ money.
The president expressed his gratitude to the Justice Ministry officials for “persevering with the challenging case to the end,” and pledged to increase efforts to safeguard national assets and interests.
This ruling represents the latest in a series of successful outcomes for the South Korean government in international arbitration cases.
In February, Seoul secured a victory in a British court, overturning an order by the same international tribunal to pay approximately 160 billion won in damages to U.S. hedge fund Elliott Investment Management concerning the controversial 2015 merger of two Samsung affiliates.
