Iranian firm likely to seize assets of Korean firms amid dispute

An Iranian business group is seeking to seize the overseas assets of Korean firms after winning a suit against the South Korean government in an investor-state dispute case, according to the financial regulator Wednesday.

Enterkhab, owned by Iran’s Mohammad Reza Dayyani, recently got international court approval at Rotterdam, the Netherland, to seize assets of Samsung Electronics, LG Electronics, KEB Hana Bank and others, according to officials.

The compensation dispute between the Iranian company and the Korean government dates back to 2010, when the Dayyani family -- largest shareholder of Iranian home appliance seller Enterkhab -- failed to acquire Daewoo Electronics.

Selected as a priority bidder to acquire the electronics company, Entekhab paid 57.8 billion ($51.5 million) as a 10 percent down payment. But creditors later annulled the deal, citing the lack of transparency in financing plans and refused to pay back the money.

Suspecting that the Korean government wrongfully interfered in the transaction, under pressure from Washington, Dayyanis filed an investor-state dispute lawsuit.

In June last year, the United Nations Commissions on International Trade Law upheld the claim, deciding that Seoul should compensate the Iranian company for the loss.

 

“The seizure attempt is only a preliminary step and is unlikely to take place,” said an official of the Financial Services Commission, adding that the Korean government has filed an appeal over the ISD suit.

The Dayyani case is the third ISD case filed against the South Korea. The previous ones were the landmark Lone Star Fund suit in 2012 and the Hanocal Holding case in 2015. While Hanocal -- backed by UAE’s royal family member Sheikh Mansour -- dropped its claim in 2016, the Lone Star case is awaiting a final verdict.

By Bae Hyun-jung (tellme@heraldcorp.com)