By Sarah Townsend
Arbitration request is filed in London court in ongoing stand-off between two state firms
Abu Dhabi’s International Petroleum Investment Company (IPIC) and its subsidiary Aabar Investments said on Tuesday they had submitted a formal request for arbitration in a contractual dispute with Malaysian state fund 1MDB.
IPIC and Aabar said in an announcement to the London Stock Exchange that they had submitted a request to the London Court of International Arbitration.
The submission “concerns the failure by 1Malaysia Development Berhad (1MDB) and [Malaysia’s] Minister of Finance (MOF) to perform their contractual obligations under the Binding Term Sheet as described in IPIC GMTN Limited's announcement of 10 June 2015”.
IPIC has business links to scandal-hit 1MDB, which is at the centre of corruption and money-laundering investigations across multiple jurisdictions.
IPIC and Aabar claim they are owed approximately $6.5 billion from 1MDB. The London Stock Exchange announcement said the “failure of 1MDB and MOF to perform their obligations, cure their defaults of put forward acceptable proposals has left IPIC in the position where it must pursue its claims in arbitration”.
The claim will be determined by an arbitral tribunal comprising three arbitrators in accordance with the Binding Term Sheet and LCIA Rules, it added.