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The heirs of a late sultan have launched authorized proceedings to grab as many as a dozen Netherlands companies of Malaysian state oil firm Petronas in a transfer set to additional infuriate Kuala Lumpur after related actions in Luxembourg in July.
Representatives of the heirs of the final sultan of Sulu stated on Thursday they’d requested The Hague Courtroom of Enchantment to recognise the $14.9bn awarded to their purchasers this yr in an arbitration case towards Malaysia.
The submitting of the petition to implement the award comes barely two months after the claimants’ attorneys stated they’d seized two Luxembourg-based Petronas subsidiaries in a sudden escalation of a authorized dispute that stems from an settlement signed 144 years in the past.
A consultant for the claimants stated they’d recognized greater than a dozen Petronas companies registered within the Netherlands, with pursuits starting from China and India to the US and Canada. Petronas didn’t instantly reply to a request for touch upon Thursday night in Kuala Lumpur.
“That is a part of an accelerating sequence of enforcement actions,” stated Paul Cohen, a lawyer at 4-5 Grey’s Inn Sq. and co-lead counsel for the claimants. “The virtually $15bn arbitration award, which Malaysia is making an attempt to keep away from settling, carries an annual 10 per cent curiosity cost. With these arithmetic, taking part in for time appears a weak technique.”
The newest transfer is a part of efforts launched by the Sulu heirs to win compensation over the Malaysian state of Sabah, which they declare their ancestor leased to British colonialists in 1878 earlier than the invention of huge pure sources within the space.
It’s prone to escalate political controversy in Kuala Lumpur sparked by the Monetary Instances’ report of the Luxembourg transfer in July. The present administration has introduced plans to launch a “activity pressure” to combat additional seizures of state belongings and a blame sport has gripped political circles in Kuala Lumpur.
Final month, former prime minister Mahathir Mohamad accused his predecessor, Najib Razak, of halting the annual stipend that Malaysia had paid to the Sulu heirs for many years in recognition of the 1878 settlement.
“There is no such thing as a report of him consulting the cupboard or different authorities, he simply decided to cease paying and that’s what triggered the motion by the sultan’s descendants,” Mahathir instructed the FT.
Najib, now jailed over his function in an embezzlement scandal on the 1MDB state fund, has himself urged that Mahathir urged the federal government to halt the funds in 2013 over an armed invasion of Sabah led by a self-declared Sulu sultan, Jamalul Kiram III.
The case introduced by the claimants, amongst them kin of Kiram who’ve disowned the invasion, has been broadly criticised by Malaysia, which is looking for to problem the legitimacy of the award made by an arbitrator in Paris. In April, finance minister Zafrul Aziz instructed the FT that it was “a frivolous, no-basis case”.
Malaysia’s overseas ministry didn’t instantly reply to a request for a remark. The Netherlands is a signatory to the New York Conference of 1958, which commits international locations to recognise awards made by arbitrators.
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