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South Korea Wins Full ICSID Annulment, Erasing $216.5 Million Lone Star Award

A rare ICSID annulment citing procedural flaws leaves Lone Star pursuing a fresh tribunal.

Overview

  • ICSID’s annulment committee voided the 2022 award and interest, retroactively eliminating South Korea’s roughly 400 billion won liability.
  • Lone Star was ordered to reimburse about 7.3 billion won in Korea’s legal costs within 30 days.
  • Seoul’s challenge focused on serious procedural defects, including the tribunal’s reliance on an ICC award without giving Korea a chance to respond.
  • Full annulments at ICSID are uncommon, with 25 annulments out of 503 decisions and only about eight complete reversals to date.
  • Lone Star said the annulment does not change its underlying claims and signaled plans to present the case to a new tribunal, as political leaders in Seoul tussle over credit and experts urge stronger ISDS capabilities.