Minister Dato' Sri Azalina contended that “the Sulu Sultanate has been defunct for several decades and is not recognized by any sovereign state or international organization.”

Photo credit: Hari Anggara. Source: Bunyan, J. (2024, March 9). ‘Frivolous and baseless’: Govt ready to fight new claims by another group of ‘Sulu heirs’, says Azalina. Malay Mail.

In that year, the Sultan of Sulu, whose territory included parts of present-day Malaysia and the Philippines, entered into an agreement with the British North Borneo Company, ceding his territory—now the Malaysian state of Sabah—in exchange for an annual payment.

Following Malaysia's independence in 1963, the government continued these annual payments to the heirs of the Sultan. However, in 2013, after an incursion by militants claiming to represent the Sulu sultanate, Malaysia ceased these payments. In response, eight individuals asserting themselves as the Sultan Jamad al Alam’s heirs initiated legal action against Malaysia, seeking arbitration over the halted payments.

In 2022, a French arbitration court awarded these claimants $14.9 billion, a decision Malaysia contested. Subsequently, in November 2024, France's top civil court upheld Malaysia's challenge, effectively nullifying the earlier arbitration award. The court determined that the original arbitration agreement specifically designated the British Consul General to Borneo as the arbitrator. Given that this position no longer exists, the court concluded that the arbitration clause could not be enforced, thereby invalidating the basis for the arbitration proceedings. The French Supreme Court's ruling underscores the importance of adhering to the original terms of arbitration agreements and highlights the challenges of enforcing historical treaties in contemporary legal contexts.

Malaysia's Law Minister, Azalina Othman Said, described this outcome as a "fundamental victory" against an attempt to "hold the people of Malaysia to ransom." Dato' Sri Azalina binti Othman Said is a seasoned politician and lawyer with a distinguished career in Malaysian politics. As a seasoned politician and lawyer, Azalina has held multiple ministerial positions and has been at the forefront of significant legal battles, including the current Malaysia-Sulu case.

Despite the court's decision, the heirs' legal representatives have indicated intentions to continue pursuing their claims, including exploring options to lease the disputed territory to other nations. In response, Minister Azalina dismissed these claims as both “frivolous and baseless,” referring to the “unfounded payments” as extortion. Azalina has emphasized Malaysia's sovereignty; “the exercise of self-determination by Sabah to become part of Malaysia has been a settled legal fact since decolonization in 1963.” Sabah has been an “integral part of Malaysia” since its start; the acclaimed attorney warned of legal action should any such attempts be made. Furthermore, she the Minister stressed that the international commercial arbitration system, a vital component of global dispute resolution, must be protected from fraudulent efforts to “extort” sovereign States under the pretense of arbitration claims.

This ongoing legal saga underscores the implications of colonialism as well as Malaysia’s firm stance on its territorial integrity and its commitment to protecting its sovereignty from external claims.

REFERENCES

Bunyan, J. (2024, March 9). ‘Frivolous and baseless’: Govt ready to fight new claims by another group of ‘Sulu heirs’, says Azalina. Malay Mail. https://www.malaymail.com/news/malaysia/2024/03/09/frivolous-and-baseless-govt-ready-to-fight-new-claims-by-another-group-of-sulu-heirs-says-azalina/122392#google_vignette

De Miguel, Rafa. (2023, June 22). The Fascinating Tale of a Multimillion-Dollar Lawsuit Featuring Sultans, Oil and a Renegade Lawyer. EL PAÍS English. https://english.elpais.com/international/2023-06-22/the-fascinating-tale-of-a-multimillion-dollar-lawsuit-featuring-sultans-oil-and-a-renegade-lawyer.html

Parry, R. L. (2024, November 12). Court rules on Malaysia’s $15 billion Sulu saga after 146 years. The Times. https://www.thetimes.com/world/asia/article/court-ends-malaysias-15-billion-sulu-saga-after-146-years-sxz52b3tb