Name: Farah Fadhilah

NIM: 1603101010199

The largest known claim to date by a Korean investor occurred, when Samsung Engineering

filed a $1 billion (USD) case at ICSID against Oman. The relationship between the two

parties in regards to the now settled issue of conflict began in 2013. Despite advanced

negotiations, the two sides were unable to put pen to paper on the deal as they were incapable

of agreeing on the project’s construction timeline. The construction unit of Samsung Group

said it asked the International Center for Settlement of Investment Disputes (ICSID) to

arbitrate a refinery improvement project in which the company was chosen as a preferred

bidder in 2013 by the state-run Oman Refineries and Petroleum Industries Company (ORPIC).

According to the ICSID, the U.S. law firm of Sheppard Mullin Richter & Hampton will

represent Samsung in the international court, which is based in Washington, D.C. On the

Oman's side, the country's Ministry of Justice and the Ministry of Oil and Gas will deal with

the matter. The case concerns development of a petroleum treatment facility improvement

venture that was charged by the state-possessed Oman Oil Refineries and Petroleum

Industries Company. Samsung Engineering was at first announced the favored bidder in the

task, yet brought the case dependent on conditions that lead to the last offer being eventually

granted to another consortium. It has not been unveiled whether Korean advice are involved.

Cases emerging out of the supposed unfair treatment by the State towards the inquirer

regarding the offering procedure to embrace enhancements to the Sohar processing plant in

northern Oman kept running by the state-claimed Oman Refineries and Petroleum Industries

Company (ORPIC) in 2013. As the talks dragged on, ORPIC issued a “bond call” on

Samsung Engineering’s tender guarantee, resulting in the latter’s expressing disagreement

over the decision through its 2015 ISDS filing.

Samsung Engineering had asked to be compensated not only for its tender guarantee, but also

to be reimbursed for its project planning and bidding expenses. Details of the settlement were

not made public. South Korea’s Samsung Engineering Co. has reportedly settled its dispute

with the Omani government over the failed contract it had preliminarily won from Oman’s

state-run Oil Refineries and Petroleum Industries Co. (ORPIC).

Note: Subject of Dispute is Refinery improvement project. It is a dispute in Economic Sector

of Construction. The Instrument(s) that Invoked in this case is BIT Korea, Republic of South

Korea - Oman 2003. The Applicable Rules for this case is ICSID Convention - Arbitration

Rules.

Analysis:

This case is categorized as international investment case because the business locations of the

parties are from 2 different countries. At first, it was brought to ICSID arbitration. Samsung

Engineering’s ISDS case against the Omani government declared the proceedings closed

after the two sides came to an agreement without an intervention from the international

arbitration institution. That’s why this case is hard to find the file because in the end both of

the parties settled the case without intervention from ICSID, the details of the settlement were

not made in public. We don’t know what the reason they want to settle it by themselves but

as we know that if we settle our problem in arbitration it must be cost a lot of money, this

case was handled for more than 8 years in ICSID, can you imagine how much the cost and

the time wasted? In my opinion, this is one of the reason the case ended settled by the parties

without any intervention even though the ICSID provides companies that have seen their

investments in foreign countries harmed or damaged due to political changes a means of

seeking restitution via a third party arbitrator. The case of a failed contact between Samsung
and Omani settled with preliminarily won from Oman’s state-run Oil Refineries and

Petroleum Industries Co. (ORPIC).