Malaysia wins 1MDB appeal against IPIC in UK court, settlement hearing can now be made public
KUALA LUMPUR, Nov 27 — Malaysia is one step closer to making public its settlement suit against an Abu Dhabi state fund to recover billions of ringgit the Pakatan Harapan (PH) government says was wrongly taken from 1MDB.
Bloomberg reported the Malaysian government’s victory in appealing the closed-door ruling at the Court of Appeal in London yesterday.
Judges agreed with Malaysia’s arguments that private arbitration proceedings meant the case would be determined without public scrutiny.
They also granted a temporary injunction to stop a second round of arbitration sought by International Petroleum Investment Company (IPIC) and its subsidiary Aabar Investments against 1MDB.
The case will now revert to the claim filed under the original lawsuit and could be expedited at the London High Court, Bloomberg reported, citing Attorney General Tommy Thomas.
“It is our case that the settlement deeds, signed in April 2017, further frustrate any legitimate attempt to challenge the settlement by including a condition that no court proceedings should be brought to set aside the consent award recorded following the settlement deeds.
“Billions of dollars of taxpayer monies have been misappropriated.
“Bringing the perpetrators to justice is a complex and challenging task,” he was quoted telling the business news wire in a statement.
The Malaysian government was represented by Richard Little in the UK court.
However, IPIC and Aabar could still appeal the latest decision.
Bloomberg reported Clifford Chance, the law firm representing the two Abu Dhabi companies in the UK court saying that they are considering making an appeal.
“Neither the English court proceedings nor the arbitration proceedings have reached a stage at which any of the issues in the underlying disputes have been decided,” Clifford Chance was quoted saying in a statement.
In Malaysia, its former prime minister Datuk Seri Najib Razak is on trial for multiple criminal, corruption, and money laundering charges connected to the misappropriation of billions of ringgit from 1MDB.
He was also finance minister from 2008 to 2018.
In 2017, 1MDB and the Ministry of Finance Inc which was then led by the Najib administration, agreed to pay US$1.2 billion and assume responsibility for RM4.8 billion in principal and interests for two bonds that were previously guaranteed by IPIC.
This was done as part of a settlement over a dispute that was brought to the London Court of International Arbitration (LCIA).
However, the LCIA is not a court of law, but a non-profit company specialising in resolving commercial disputes and its proceedings are confidential even after its conclusion.
After winning the 14th general election, the new PH government claimed the settlement was an attempt to cover up fraud involving US$3.5 billion in 1MDB funds, and brought a case to the London High Court in a bid set aside the LCIA consent award.
IPIC and Aabar have responded to the suit by initiating a second round of arbitration proceedings, and successfully persuaded the London High Court to stay proceedings pending the outcome of the arbitration.
Appealing against the High Court decision, lawyers representing 1MDB and MOF Inc had argued that IPIC and Aabar’s move merely sought to ensure that the dispute would not be resolved in the public view.
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