[UPDATED] M’sia gains landmark win on Sulu claims at Paris appeals court

KUALA LUMPUR – The Paris Court of Appeal upheld Malaysia’s challenge against the partial award rendered on May 25, 2020 by arbitrator Gonzalo Stampa in the case filed by eight citizens of the Philippines, who are purported heirs of the long-defunct Sulu sultanate.

Datuk Seri Azalina Othman Said said the decision means that the purported Sulu claimants cannot rely on the award in France for any purpose.

“The Paris Court of Appeal found that the arbitrator (Stampa) wrongly upheld his jurisdiction,” said the minister in the Prime Minister’s Department in charge of law and institutional reforms in a statement today.

“This decision, which is final and binding, is a decisive victory for Malaysia in its ongoing pursuit of legal remedies, which Malaysia is confident will result in comprehensive defeat for the claimants and their funders.” 

Azalina said Malaysia trusts that today’s decision in Paris will put an end to the efforts of the Sulu claimants and their funder, Therium, to enforce the unlawful awards and thereby extract windfall damages from Malaysia.

Azalina said as part of their abusive strategy, the claimants had previously targeted Malaysia’s diplomatic assets in France – including part of its embassy – on the basis of the partial award.

However, she said that Malaysia had been fighting these measures on the grounds of diplomatic immunity.

“They must now be withdrawn following today’s decision that refused to give any effect to the partial award in France,” she said.

Importantly, this decision implies that the Paris appeals court will annul the purported “final award” in which Stampa awarded close to US$15 billion (RM69 billion) to the claimants.

The law minister said Malaysia is seeking to have the annulment recorded in a court decision as soon as possible, which should lead to the collapse of the claimants’ global enforcement efforts to date. 

“Mr. Stampa issued the “Final Award” despite his appointment having been annulled by the same Spanish court that had previously appointed him, on the basis that Malaysia had not been properly served ahead of that appointment process,” said Azalina.

“In defiance of Spanish court orders instructing him to cease acting as arbitrator, in an unprecedented move, Mr Stampa transferred the arbitration proceeding to France and issued his “Final Award” and Mr Stampa’s sustained actions in defiance of Spanish court orders have resulted in a significant abuse of the international arbitration process.”

Azalina also expressed appreciation to Prime Minister Datuk Seri Anwar Ibrahim for his continued support and unwavering trust in the ongoing effort to uphold Malaysia’s position.

“We would also like to express our gratitude to Foreign Minister Datuk Seri Dr Zambry Abdul Kadir, the Communications and Digital Minister Fahmi Fadzil, the Attorney-General, the State Government of Sabah, the Attorney-General’s Chambers, the Malaysian Embassy in France, the relevant Ministries and agencies and all other parties involved,” she said.

She said Malaysia will continue to take all necessary actions – including legal action – to put an end to the claims and to ensure that Malaysia’s interests, sovereign immunity, and sovereignty are protected at all times. 

The group claiming to be heirs of the Sulu sultanate was reported to have taken legal action in a Spanish court to seek compensation for land in Sabah, which was allegedly leased by their ancestors to a British trading company in 1878.

They then took the matter to the Spanish arbitrator in 2019 and the purported arbitrator, Stampa, who was appointed by the group of individuals, decided in the claimants’ favour.

Stampa had issued a final award of US$14.9 billion against Malaysia and Malaysia had used all legal remedies to annul the award given by Stampa to claimants in courts in Spain, France, Luxembourg, and the Netherlands.

On March 14 this year, the Paris Court of Appeal upheld the stay order obtained by the Malaysian government in France on July 12, 2022, against the enforcement of the award.

Therefore, the suspension order obtained by Malaysia regarding the enforcement of the award is maintained. – Bernama, June 6, 2023