KUALA LUMPUR – The legal battle between Malaysia and a group claiming to be heirs of the defunct Sulu Sultanate is set to continue at the Paris Court of Appeal on July 7, where French judges will examine the validity of a US$14.9 billion arbitration award issued against Malaysia.
Minister in the Prime Minister’s Department (Law and Institutional Reform) Datuk Seri Azalina Othman Said said the proceedings will review the legality of the award and various related legal matters.
“Malaysia will continue to pursue all efforts, rights and available resources to protect its sovereign immunity and national interests, and to bring a final end to the baseless fraud by the Sulu group,” she said in a statement.
She added that a series of recent court decisions in favour of Malaysia have significantly strengthened the country’s legal standing and sovereignty as an independent nation.
“These recent decisions in Malaysia’s favour have significantly reinforced the position and rule of law of Malaysia as a free and sovereign country,” she said.
Among the key outcomes she cited were the French court’s cancellation of an earlier recognition of the award, the Dutch Supreme Court’s rejection of the final award, and the conviction of arbitrator Gonzalo Stampa by the French Court of Appeal for contempt of court.
Azalina said the case has tested the limits of Malaysia’s sovereign immunity, exposing how third-party litigation funding was misused to prolong an unfounded claim in a deceptive manner and how a private arbitration tribunal attempted to seize Malaysian government assets.
“The Sulu group’s claim has challenged the limits of Malaysia’s sovereign immunity, revealing how third-party funding was misused to extend a baseless claim against Malaysia through highly devious means, and how a private arbitration tribunal attempted to seize state-owned assets,” she said.
During her working visit to Europe, Azalina met with Malaysia’s legal team in Paris to continue strategic planning and receive updates on the ongoing case.
The dispute began when eight Filipino nationals claiming to be descendants of the now-defunct Sulu Sultanate filed arbitration proceedings in Spain, demanding billions of dollars from Malaysia over a long-standing dispute involving Sabah.
In March 2019, a court in Madrid appointed Gonzalo Stampa as arbitrator, but the appointment was later annulled by the same court.
Despite the annulment, on February 28, 2022, Stampa issued a Final Award ordering Malaysia to pay US$14.9 billion, based on an arbitration process that Malaysia has consistently argued was illegitimate.
Since then, Malaysia has recorded a series of legal victories. In a landmark decision in November last year, the French Supreme Court fully dismissed the legal challenge filed by the Sulu group.
That ruling means the basis for the Final Award – that Malaysia must pay US$14.9 billion – is not recognised under French law.
Azalina reaffirmed Malaysia’s commitment to defending its legal rights and sovereignty on the global stage. – April 30, 2025