REPUBLIC OF KOREA V ELLIOTT ASSOCIATES LP

[2024] EWHC 2037 (Comm), King's Bench Division, Commercial Court, Mr Justice Foxton, 1 August 2024

Arbitration – International Investment Treaty – Merger of company in which investor held shares – Whether acts carried out by State – Jurisdiction – Permission to appeal – Vienna Convention on the Law of Treaties 1969 – USA-Korea Free Trade Agreement – Arbitration Act 1996, sections 30 and 67

EALP, a US investment fund, acquired a 7.12 per cent share in SC&T. The National Pension Fund of Korea, NPF, held 11.94 per cent of the SC&T shares. Despite EALP’s opposition, the shareholders in SC&T approved a merger with Cheil, a company in which NPF had a shareholding. The merger would not have been approved without NPF's votes. EALP commenced arbitration against Korea under the USA-Korea Free Trade Agreement, alleging that Korea had through NPF failed to adhere to a minimum standard of treatment obligation. Article 11 of the Agreement applied to measures adopted or maintained by a party relating to investments and investors. Korea objected to the jurisdiction of the tribunal on the grounds that: (i) there was no relevant "measure"; (ii) there was no measure "adopted or maintained" by Korea; and (iii) the measure did not "relate to" EALP or its investment.