South Korea has filed an appeal against a ruling by a Hague-based arbitration court ordering it to pay $32 million to a US hedge fund to compensate for its intervention in the merger of two Samsung affiliates in 2015, the Justice Ministry said Thursday.

The appeal to the ruling by the Permanent Court of Arbitration follows the tribunal’s decision in April to side with Mason Capital Management, though the compensation ordered was much less than the $200 million the hedge fund had sought.

Mason Capital argued that the Korean government exercised its influence over the National Pension Service’s decision to green-light the $8-billion merger of two Samsung affiliates -- Samsung C&T and Cheil Industries -- in 2015. The hedge fund’s investors, as a result, suffered losses, as the unfair intervention led to a drop in the stock value of Samsung C&T, according to Mason Capital.

The Justice Ministry claims in a statement that the Hague-based tribunal “erroneously interpreted” its jurisdiction under the South Korea-US free trade agreement. This error gives the Korean government fair grounds to appeal against the ruling, it added.

It plans to challenge the ruling at a Singaporean arbitration body, according to the ministry.

The ministry pledged its best efforts to avoid having to pay the compensation. It took issue with the PCA’s decision, saying that it wrongfully interpreted the actions of a few individuals, including former President Park Geun-hye, who was in office at the time of the 2015 merger, as government decisions.

The controversial merger deal of 2015 was at the heart of a corruption scandal involving high-profile politicians and business leaders here, which ultimately led to the impeachment of Park in 2017 and imprisonment of current Samsung Electronics Executive Chairman Lee Jae-yong, also in 2017. The merger was seen as a move to help tighten Lee’s control over the family-controlled conglomerate.

An earlier notice of intent filed by Mason Capital with the Korean government read, "Korean government officials, from the highest level, through to the NPS, an organ of the State, acted to manipulate the vote motivated by bribery, favoritism to the Lee Family, and open hostility toward non-Korean investors.”

The Justice Ministry’s appeal follows its similar decision last year to challenge the PCA’s ruling to pay US activist fund Elliot Investment Management some $108.5 million over the Korean government’s role in the controversial merger. The ministry has challenged the ruling at a British arbitration body,