S. Korea to challenge British court decision in failed Daewoo Electronics deal

South Korea will present its objections this month to a ruling by the High Court of Justice in Britain in the failed takeover of Daewoo Electronics, granting Iran's Dayyani family an interim charging order against Dana Petroleum shares.

Dana Petroleum is a wholly-owned subsidiary of state-run Korea National Oil Corp.

A Financial Services Commission said that the South Korean government has been in talks with the Dayyani family over how to satisfy the 73 billion won obligation.

The dispute arose after South Korea's state-run Korea Asset Management Corp. (KAMCO) terminated a deal after picking Entekhab Industrial Group as the preferred bidder for a controlling stake in Daewoo Electronics, citing funding uncertainties.

Entekhab, represented by its Singapore-based firm D&A, had already paid 57.8 billion won, or 10 percent of the total value, after signing the deal.

The Dayyani family demanded that KAMCO return the paid amount.

However, the creditors of Daewoo Electronics declined, blaming D&A for the botched deal.

The Dayyani family then sought an investor-state dispute settlement against South Korea to recover the 57.8 billion-won payment and filed the complaint with the International Center for Settlement of Investment Disputes (ICSID), demanding 93.5 billion won.

In 2018, the ICSID ordered South Korea to pay the Iranian family 73 billion won as compensation, finding the creditors of Daewoo Electronics as responsible for the deal's breakdown.

South Korea sought to nullify the international ruling in the British court, which rules against it in December.

It was the first time for South Korea to get an unfavorable decision against a foreign firm in an Investor-State Dispute Settlement, a process where investors sue countries for unfair practices.