The Sulu Sultanate Eggs Our Face?

Two of Petronas’ subsidiaries in Azerbaijan were reported to have been seized by court bailiffs after an arbitration court in France ruled in March last year that Malaysia has to pay a USD15 billion or RM62.59 bil in compensation to descendants of the Sulu Sultanate. The holding companies seized are estimated to be worth more than RM8.87 bil.  However, Petronas contests that is not true – it has divested its entire assets in Azerbaijan and repatriated the proceeds from the exercise.

In March 2021, Spanish arbitrator, Gonzalo Stampa, had instructed the Malaysian Government to pay at least US$14.92 bil (RM62.59 bil) to the descendants of the last Sulu sultan.  The ruling was made following a violation of the 1878 agreement signed by Sultan Jamal Al Alam, Baron de Overbeck and the British North Borneo Company’s Alfred Dent.  Malaysia stopped paying Sultan Sulu’s heirs their annual RM5,300 cession money since 2013 as a result of the Lahad Datu armed incursion.  And by stopping the payment since 2013, Malaysia had breached the agreement. 

Source: https://www.therakyatpost.com

The claims of the heirs of the Sulu Sultanate to Sabah or compensation in lieu of repossession lacks credibility in international law or even on the basis of the agreement signed between Sultan Mohamet Jamal Al Alam with Baron von Overbeck and Alfred Dent on Jan 22, 1878.

Whatever payment made to the heirs is ex-gratia (something done out of favour, voluntarily). It follows, therefore, that an ex-gratia payment can be withheld or withdrawn permanently/indefinitely should the payer (the Malaysian government) decide to do so — as it did in 2013 following the Lahad Datu incursion.

But in any event, this whole episode is an embarrassment to the Malaysian Government. For us to pretend it is of no consequence has ended up with egg on our face. Couldn’t the AGC or some legal authority countered this action well before the latest seizure of Petronas’ assets? Are we asleep as others work themselves to be billionaires at our expense?

References:

Report: Two of Petronas’ subsidiaries in Azerbaijan seized by Sulu Sultanate’s heirs, G. Vinod, Focus Malaysia

Sulu Sultanate had forever forfeited claim over Sabah, Jason Loh Seong Wei, New Straits Times, 16 March 2022