Report: Malaysia ordered to pay almost RM63b to Sulu sultan’s descendants

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The Malaysian government has reportedly been instructed to pay at least US$14.92 billion (RM62.59 billion) to the descendants of the last Sulu sultan.

This is due to a violation of the 1878 agreement signed by Sultan Jamal Al Alam, Baron de Overbeck and the British North Borneo Company’s Alfred Dent.

Malaysia has stopped paying Sultan Sulu’s heirs their annual RM5,300 cession money since 2013 following the Lahad Datu armed incursion.

Yesterday, Spanish news website La Información reported that Spanish arbitrator Gonzalo Stampa had issued the award in an arbitration court in Paris, France.

Dubbing it the “largest arbitration in Spain”, the article said Stampa ruled that the 1878 treaty constituted a commercial “international private lease agreement”.

By not paying the cession money since 2013, he said Malaysia had breached the agreement.

Unless the award is cancelled, Malaysia now has three months to pay up or risk paying interest.

The Sulu sultan’s descendants had initially wanted to claim US$32.2 billion (RM135.08 billion) from Malaysia. This was to recover the unpaid cession money along with how much they believe they should have been paid for the oil and gas found in the region.

They were represented by Spanish law firm B Cremades & Asociados along with Paul Cohen and Elisabeth Mason of London’s 4-5 Gray’s Inn Square.

“The arbitrator (Stampa) complied with his mandate scrupulously and legally, ruling on a contractual dispute between the parties,” Bernardo Cremades Jr was quoted as saying.

Malaysia absent from arbitration

The descendants had initiated the case in Spain as the 1878 agreement was signed on Spanish soil.

The case was originally heard in Madrid until the Madrid High Court (Tribunal Superior de Justica de Madrid) annulled Stampa’s appointment on grounds that Malaysia was not properly informed about the case and was thus “defenceless”.

The case was later moved to the French capital.

According to the arbitration news website Global Arbitration Review, Malaysia did not appear in the Paris arbitration hearing.

Following Stampa’s annulment, Malaysia is challenging his validity to hear the case in criminal court.

Malaysiakini is contacting the Foreign Ministry and Attorney-General’s Chambers for comment. – Malaysiakini