1MDB-IPIC trial: Govt mulls all options

Govt is open to considering any form of solutions offered to ensure the country’s assets are returned and justice can be upheld


THE government will consider all options offered for the arbitration agreement between 1Malaysia Development Bhd (1MDB) and Abu Dhabi’s International Petroleum Investment Co (IPIC), said Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz.

The court proceeding, which is taking place in London, is to negate the US$5.78 billion (RM23.41 billion) settlement between 1MDB and IPIC reached in 2017 and to recover the US$3.5 billion paid to the latter’s subsidiary, Aabar Investment PJS Ltd.

“The government is currently pursuing legal action to cancel the settlement agreement between 1MDB and IPIC in London.

“There are various interlocutory proceedings that have been filed either by the Malaysian government or IPIC and Aabar which are each being challenged.

“The government is open to considering any form of solutions offered that are in line with the principles and responsibilities of the government, which is to ensure the country’s assets are returned and justice can be upheld,” Tengku Zafrul said in a written reply for the Dewan Rakyat dated Dec 15.

He was responding to a query by Wong Chen (PKR-Subang) on the latest update of the negotiation between 1MDB and IPIC, as well as the agreed amount or scheduled payment, if any.

Under the Barisan Nasional administration, 1MDB and Abu Dhabi’s sovereign wealth fund reached a US$5.78 billion settlement in 2017 at the London Court of International Arbitration involving two bonds amounting to US$3.5 billion.

Among the agreements, 1MDB will make certain payments to IPIC and would assume the responsibility for all future interest and principal payments for the two bonds issued by the 1MDB group of companies due in 2022.

The arbitration was conducted due to a dispute between the state and sovereign funds on the two bonds raised in 2012 after 1MDB acquired two power plants that were guaranteed by IPIC.

Abu Dhabi’s sovereign wealth fund had guaranteed two separate dollar-denominated bonds for 1MDB in deals arranged by Goldman Sachs Group Inc.

In November last year, the UK Court of Appeal ruled in favour of Malaysia to challenge the settlement in an open court, arguing that IPIC and Aabar were aware of fraud allegations against former Prime Minister Datuk Seri Mohd Najib Razak at the time the deal was struck.

However, the Sarawak Report, which exposed the 1MDB financial scandal, claimed recently that the government has halted the court proceedings against IPIC in favour of diplomatic negotiations between the Malaysian royals and the Arab nation.

Last August, the Attorney General’s (AG) Chambers said the proceeding that challenges the settlement is being proceeded as planned between the two countries

“Negotiations are continuously being held by the government, including by the Pakatan Harapan government and the present government.

“The discussion only involves government officials from the Malaysian government and the United Arab Emirates without the involvement of anyone else,” AG Tan Sri Idrus Harun said in a statement.

Read our previous report here

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