Heirs of the late Sulu sultan today asked a Dutch court for permission to seize Malaysian assets in the Netherlands, their lawyer said, seeking enforcement of a US$15 billion arbitration award granted to them against Malaysia’s government.

The petition in The Hague Court of Appeal is an escalation of a long-running dispute over a colonial-era land deal that threatens global assets of the Malaysian government and state-owned companies.

Malaysia’s government, which has said it does not recognise the heirs’ claim...