South Korea wins ISDS case against Dayani family

The South Korean government has achieved a complete victory in a second international investment dispute (ISDS) brought by the Iranian Dayani family. An arbitration tribunal unanimously dismissed the family's claim for approximately 770 billion won in damages.

The dispute arose after the Dayani family filed a second claim, alleging that the South Korean government violated the Korea-Iran investment treaty by delaying payments from a previous 2018 arbitration ruling. The family sought compensation for potential lost profits they would have earned had the original funds been available for reinvestment.

The tribunal ruled that the government's actions—including seeking approval from the U.S. Office of Foreign Assets Control (OFAC) due to sanctions and utilizing legal processes in UK and Korean courts—were legitimate and unavoidable. Consequently, the government will recover 75% of its litigation costs, totaling approximately 4 billion won, along with all arbitration administrative expenses.