South Korea has emerged victorious in an international arbitration dispute against Schindler Holding AG, a Swiss elevator manufacturer, averting a substantial potential payout of 320 billion won ($211.4 million), the justice ministry announced Saturday.
During a press conference held at the government complex in Seoul, Justice Minister Jung Sung-ho confirmed that the Permanent Court of Arbitration (PCA) in The Hague dismissed all claims brought by the Swiss company in a ruling delivered early Saturday. This included the 320 billion-won damage claim. Furthermore, South Korea will recover approximately 9.6 billion won in legal costs.
“This is a complete victory for the Republic of Korea,” the minister stated, 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 paid-in capital increases by Hyundai Elevator Co. between 2013 and 2015.
The Swiss firm, which held the position of second-largest shareholder in Hyundai Elevator at the time, contended that these capital increases were primarily implemented to assist Hyundai Group in maintaining control over its affiliates, including Hyundai Merchant Marine, rather than serving legitimate business purposes.
Schindler asserted that it suffered financial losses due to the government’s alleged oversight failures. The company initially sought damages of approximately 500 billion won before reducing the amount to around 320 billion won.
On Saturday, the tribunal ruled that Seoul had acted within its legal authority and conducted sufficient investigations at the time. The court found no breach of the government’s investment treaty obligations and rejected the argument that the state bore responsibility for the losses under international law.
This ruling marks the latest in a string of successful outcomes for the South Korean government in international arbitration cases.
In February, Seoul prevailed in a lawsuit 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.
