EAST the fact that the surrender payment continued to be made to the (supposed) heirs of the Sultanate of Sulu until 2013 following the Lahad Datu incursion was materially relevant to their claim for compensation, etc. ?
Some would say that Malaysia’s “resumption” of the payment of the RM5,300 surrender under the terms of the 1878 agreement signed between Sultan Mohamet Jamal Al Alam with Baron von Overbeck and Alfred Dent constitutes an explicit (if not implicit) acknowledgment ) of the “lease”, i.e. Sabah (then North Borneo) was only leased – not assigned – to the North Borneo Chartered Company (NBCC). Otherwise, why continue to make the payment, especially after the fact that it was effectively interrupted by the NBCC in 1936 when Sultan Jamalul Kiram II died that year without leaving an heir?
In other words, the act of making a payment would presuppose by default and imply that it is not voluntary but a legal obligation and the responsibility of NBCC and, by extension, the British colonial administration and finally the Malaysian government. And therefore, the cessation of payment of the assignment in 2013 only serves to attract the sum of the indemnities awarded by the French arbitral tribunal in Paris via Dr. Gonzalo Stampa on May 5, 2021 for the sum of 14.92 billion dollars US (about RM62.59 billion). The original claim was for US$32 billion – which included both the unpaid surrender sum as well as the gross value of oil and gas reserves in Sabah’s Exclusive Economic Zone (EEZ).
Nevertheless, on June 29, 2021, at the request of the Malaysian government, the court in Madrid revoked Stampa’s appointment as arbitrator. This was followed by another Madrid court decision on October 13, 2021 which specifically stated that Stampa did not have the jurisdictional power to issue this decision ex parte (i.e. without the presence of the other party) on behalf of the French Court of Arbitration, which has since become null and void.
According to Prime Minister’s Department Minister (Parliament and Law) Datuk Seri Wan Junaidi Tuanku Jaafar, the Malaysian government had also filed a criminal complaint with the Spanish Attorney General against Stampa to protest his failure to comply with the Superior Court of Justice. of Madrid’s decision alongside procedural irregularities, injustice and disregard for the rule of law on December 14, 2021.
A call has also been made by the Malaysian government to revoke the exequatur order and a request to suspend its implementation. On December 16, 2021, the French Court of Appeal granted the request of the Malaysian government to suspend the exequatur order issued on September 29, 2021 pending an appeal. The exequatur order simply means that the French Court of Arbitration has the authority and jurisdiction to enforce the award with legal effect outside of France, i.e. on the Malaysian government.
As Wan Junaidi pointed out, the preliminary or partial ruling issued on May 25, 2020 in Madrid by Stampa started from an erroneous assumption. That is, the 1878 agreement was a “private lease contract”. This is, of course, contrary to the facts of the matter since the 1878 agreement was signed between one party who claimed sovereign right and ownership, and the other party who intended to do so in the same territory .
It is simply irrefutable that the administration of the NBCC possesses all the characteristics of a government, that is to say a sovereign entity – which contradicts the absurd argument that it is purely a commercial transaction. As for the argument – accepted again by Stampa on February 28, 2022 in defiance of his dismissal and disqualification (see page 94 of the final award) – that the sovereign can also behave as a private citizen (acta de iure gestionis) and therefore no legal immunity is granted is simply untenable. For that would effectively mean that there would have been, at least, some semblance of a Sultanate of Sulu or Spanish sovereignty in North Borneo.
For example, there would or should have been some form of hybrid legal or even administrative system or both. Tax revenues would have been partially diverted to the Sultanate of Sulu in addition to the cession payment and, by extension, to the Spanish Philippines. As we all know, taxation is one of the fundamental characteristics of sovereignty, because it is based on coercive power and law. Taxes determine the currency as it is issued by the state, which is also another feature of sovereignty. None of this ever existed.
Furthermore, the payment after the 1963 surrender was denominated in ringgit – that is, the currency of Malaysia as a sovereign entity. No complaint or grievance was ever filed to alter this arrangement by the heirs of the Sultanate of Sulu. This means that the claimants (supposedly heirs and successors in title to the Sultanate of Sulu) and the arbitrator confused the procedural aspects with the substantive aspects of the 1878 agreement. The procedure by which the 1878 agreement was to to be executed would be the surrender payment (originally S$5,300). The substantive issue of the 1878 agreement concerns the transfer of North Borneo from one sovereign entity to another.
Again, that the NBCC was a sovereign entity in its own right was neither novel nor absurd – since its counterpart in India had been the English East India Company before the Crown assumed direct control to become the British Raj under the Government of India Act. (1858).
Of course, such a case was not limited to the British alone. The Dutch East India Company operated the same way – in Malacca and in the so-called East Indies (modern Indonesia). It is undeniable that NBCC, at all relevant times, perceived itself as a sovereign power and intended to act accordingly (acts of imperii law).
As for the heirs of the Sultanate of Sulu, it does not matter if 1936 marked the time when there were no more known heirs or if the family line continued after that. What ultimately matters is that the surrender payment was never an acknowledgment of sovereignty – as demonstrated by the behavior of the NBCC and subsequent legally binding agreements (namely the Madrid Protocol of 1885 and the Confirmation of the deed of transfer of 1903).
Jason Loh Seong Wei is responsible for the social, legal and human rights department at EMIR Research, an independent think tank focused on strategic policy recommendations based on rigorous research.
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