Malaysian Government Minister Calls for Review of Arbitrators and Litigation Funders
The dispute between the Malaysian government and the Sulu heirs has been one of the most high profile international arbitration cases in recent times, raising issues around state sovereignty and the role of third-party funders in international arbitration. At a recent industry gathering, one of Malaysia’s top government ministers spoke about the country’s ongoing efforts to have the multi-billion dollar award annulled, as well as the need for reform of the international arbitration system. Reporting by The Edge Malaysia provides an overview of recent comments made by Datuk Seri Azalina Othman Said, the minister for Law and Institutional Reform in the Prime Minister’s Department, at the London International Arbitration Colloquium 2023. In her keynote address at last week’s event, Azalina called for “a review of the conduct of arbitrators and for oversight of third-party litigation funders, including exploring transparency and disclosure obligations by the relevant parties.” The minister’s comments come at the same time as Malaysia continues to seek the annulment of the $14.9 billion award, which was issued to the Sulu heir claimants by a Spanish arbitrator. These efforts follow Malaysia's successes in securing favourable rulings from both the Paris Court of Appeal and from The Hague Court of Appeal in June of this year, which respectively upheld Malaysia’s challenge to the award and refused the Sulu heirs’ attempt to have the award enforced. During the speech, Azalina also highlighted that the Kuala Lumpur-based Asian International Arbitration Centre (AIAC) had entered into a memorandum of understanding with the Arbitration and Dispute Resolution Centre at SOAS, “to foster teaching and research activities related to alternative dispute resolution in alignment with international best practices.” Citing the Malaysian government’s experience in the Sulu case, she emphasized that “the sanctity of the arbitration process must always be upheld” from abuses such as forum shopping or frivolous claims.