SINGAPORE: Singapore’s High Court has granted a temporary reprieve to troubled South Korean giant Hanjin, allowing its ships to sail into the city-state without fear of being impounded as it struggles to settle a $5.37-billion debt.
Since last month, Hanjin’s vessels, sailors and cargo have been stuck in a maritime limbo as ports, wary they will not be paid for their services, refuse to let them dock and refuse to handle or free cargo already landed.
The ruling, seen by AFP on Friday, suspends “any enforcement or execution against any asset” of Hanjin and two local subsidiaries, which means that vessels can sail into Singapore without fear of being seized, pending approval of the company’s recovery plan.
“I was satisfied that the Korean rehabilitation orders should be recognised and assistance rendered,” judge Aedit Abdullah said in a ruling issued on Wednesday, adding this could be “to the extent of preventing arrest of ships of the Hanjin fleet.”
Hanjin, the world’s seventh largest shipping firm, on August 31 sought court protection in the industry’s biggest-ever bankruptcy filing after creditors rejected its latest plan to get out of debt.
About two thirds of its cargo fleet is marooned at sea, while some of its ships have been seized at various ports worldwide, including one container vessel in Singapore.
The crisis has badly hit the international shipping industry, suffering from its worst downturn in six decades, with retailers fearing it may damage Christmas trade.
The ruling said Hanjin had told the Singapore High Court that its petition was part of a global effort “to prevent piecemeal and haphazard resolution of the company’s difficulties” which would impair the firm’s recovery.
A US court has already issued an order allowing Hanjin to unload some cargo without fear of creditors seizing its ships, a company spokesman said in Seoul on September 10.
On Saturday a key member of the Hanjin group, Korean Air, agreed to a partial bailout of its shipping unit to the tune of 60 billion won ($55 million).
Hanjin had told the Singapore court that the company is scheduled to present a recovery plan by November 25.