Key facts
- An international arbitration body dismissed an Iranian investor's 770 billion-won ($566 million) damages claim against Seoul.
- The Permanent Court of Arbitration (PCA) ruled in favor of South Korea in the case brought by six members of Iran's Dayyani family.
- The Dayyanis were ordered to pay South Korea about 4 billion won for legal expenses and 800 million won in administrative fees.
- The claim stemmed from a delayed payment related to a 2018 arbitration ruling that ordered Seoul to pay 73 billion won over the failed takeover of Daewoo Electronics.
- Seoul attributed the payment delay to the need for approval from the U.S. Office of Foreign Assets Control (OFAC) due to U.S. sanctions against Iran.
An international arbitration body has dismissed a 770 billion-won ($566 million) damages claim by an Iranian investor against Seoul, the justice ministry announced Wednesday. The panel under the Hague-based Permanent Court of Arbitration (PCA) ruled in favor of South Korea in the case brought by six members of Iran's Dayyani family in 2021.
The Dayyanis had sought compensation for Seoul's delayed transfer of funds related to a prior arbitration. In 2018, an arbitration ordered Seoul to pay 73 billion won plus interest to the Dayyanis over the failed takeover of Daewoo Electronics by Entekhab Industrial Group, a major shareholder of which the Dayyanis are. Seoul made the payment in April 2022.
The Dayyanis filed a new case in October 2021, claiming 770 billion won in damages due to the delay. South Korea attributed the delay to the need for approval from the U.S. Office of Foreign Assets Control (OFAC), citing U.S. sanctions against Iran and the global economic situation. The PCA panel agreed that Seoul did not discriminate against the Dayyanis and that the OFAC approval was justified.
As a result of the ruling, the Dayyanis were ordered to pay South Korea approximately 4 billion won for legal expenses and around 800 million won in administrative fees.