South Korea Wins ISDS Case Against Schindler, PCA Dismisses All Claims in The Hague

Seoul announced on Wednesday that South Korea has won the ISDS case brought by Swiss elevator maker Schindler against the government, with the tribunal at the Permanent Court of Arbitration in The Hague dismissing all of Schindler’s claims. Justice Minister Jeong Seong-ho said the panel ruled in the government’s favor early this morning, at about 2:03 a.m. local time.

The dispute centered on Hyundai Elevator’s 2013–2015 paid-in capital increase and the transfer of call options, with Schindler arguing that Korea’s regulators failed to exercise oversight properly, contributing to a drop in Hyundai Elevator’s share price. Schindler, which was one of Hyundai Elevator’s two major shareholders at the time, contended the capital increase was aimed at maintaining affiliate control rather than for business necessity.

Schindler sought damages totaling roughly 259 million Swiss francs, about 500 billion won, according to the Korean government. In addition, it claimed compensation related to losses incurred during the disputed actions. The tribunal ultimately dismissed all of Schindler’s damage claims.

The PCA tribunal found that actions by Korea’s regulatory bodies—the Fair Trade Commission, the Financial Services Commission, and the Financial Supervisory Service—were taken within their legally authorized powers and were not arbitrary or discriminatory. As a result, there was no finding of investment treaty breach or state responsibility by Korea.

Minister Jeong emphasized that the ruling reinforces the principle that legitimate regulatory action taken in the public interest should be respected under international law. He said the government will continue to respond proactively to international investment disputes to safeguard the nation’s interests.

Why this matters beyond Korea: ISDS cases affect how foreign investors view regulatory risk and the enforceability of government actions in major markets. For U.S. companies with supply chains or investments in Korea, the decision signals that Korea can enforce its competition and financial regulations within the bounds of international law without automatically exposing the state to liability under investment treaties. It also illustrates how arbitration costs are allocated when a claimant’s case fails.

Context for non-Korean readers: The Permanent Court of Arbitration in The Hague provides services for international arbitration, including ISDS under various investment treaties. Hyundai Elevator is a major Korean manufacturer involved in capital-raising and corporate governance matters, while Schindler, a Swiss multinational, operates in the global elevator and escalator industry. The Korean agencies cited—FTC, FSC, and FSS—are Korea’s competition and financial regulators.