Hanjin Shipping Officially Sunk, Declared Bankrupt
February 16, 2017
A South Korean court on Friday pulled the plug on Hanjin Shipping Co., declaring it bankrupt and ordering the liquidation of a company that has led the country’s shipping industry for the past four decades.
The bankruptcy comes five months after the company, which was once one of the largest container-shipping lines in the world, filed for court receivership under heavy debt.
A court-appointed caretaker will sell any remaining ships and other assets Hanjin still owns to pay off its creditors, said Choi Ung-young, a judge on the Seoul Central District Court.
The court closed the company’s rehabilitation proceedings earlier this month, saying liquidation would bring more value to creditors, with its major assets mostly sold off.
Hanjin Tells Bankruptcy Courts US Liabilities Far Outweigh US Assets
December 27, 2016
Hanjin Shipping’s US liabilities far exceed its US assets of more than $124 million, the company told a New Jersey bankruptcy court Tuesday amid close scrutiny from a host of US creditors hoping to get paid – including one claiming to be owed $22 million. The troubled container line filed the financial disclosure a day before a US District Bankruptcy Court in New Jersey was scheduled to discuss the ocean carrier’s request to extend a previous Friday deadline to disclose its assets.
Hanjin, which filed for bankruptcy in a South Korean court on Aug. 30, missed the Friday deadline and so sought an extension to Jan. 9. But Judge John K. Sherwood scheduled a hearing on the matter for Wednesday. The hearing comes as Hanjin is seeking to finalize the sale of Total Terminals International, which operates terminals in Long Beach and Seattle and of which Hanjin owns 54 percent.
Also Friday, Hanjin filed papers asking the court to recognize and enforce the sale, which has been approved by the South Korean bankruptcy court. Several logistics and other companies who say they are owed money by Hanjin – among them a container company seeking $22 million in compensation – are closely watching the disclosure process, and several have filed court papers in the past to protect their claims.
Two insurance companies, Continental Insurance Company and Continental Casualty Company, immediately filed papers in opposition to Hanjin’s request for a two-week extension, saying that would give it only three days in which to analyze the documents before Sherwood held a Jan. 12hearing to determine whether the court would approve the sale or not. “Three business days is simply not enough time for Hanjin’s creditors to review and reasonably evaluate the disclosures,” the insurance companies wrote. Continental Insurance Company and Continental Casualty Company have argued in court papers that their policy holders include companies that provided equipment to Hanjin, who likely will face claims for damage and additional expenses that occurred after Hanjin filed for bankruptcy.
Textainer, the California-based container leasing company, has filed papers to protect potential claims for compensation from Hanjin’s continued use of its containers. TRAC Intermodal, Sea Cube, Home Shopping Network, and OceanConnect Marine have also filed papers in the case.
Source: AIMU Weekly Bulletin
Important Updates on Hanjin Shipping Bankruptcy
November 10, 2016
The following communication was distributed by Richard L. Furman, Member of Carroll McNulty & Kull (CMK) Law Firm:
As of Monday, November 7, nearly all of Hanjin’s container ships have completed their cargo unloading at worldwide ports. The Korean Herald reported there are still five container ships stranded at sea.
According to Reuters, cargo owners are shifting their business to more financially stable shipping lines while carriers are pursuing mergers to avoid repeating Hanjin’s collapse. For example, Japan’s top-three carriers – Nippon Yusen KK, Mitsui O.S.K. Lines Ltd. And Kawasaki Kisen Kaisha, Ltd. – announced a merger that would make the combined company the sixth-largest global box carrier. Read More
Motion Granted in Hanjin Shipping Bankruptcy Court
October 13, 2016
The following communication was distributed by Richard L. Furman:
The U.S. Bankruptcy Court in New Jersey conducted a hearing on October 7, 2016. Among other matters addressed by the Court was a motion by an NVOCC, Globerunners, Inc., seeking a ruling from the Court expanding and clarifying the Court’s September 9 Order granting provision relief. More specifically, Globerunners wanted the Court to expand its provision order to apply not only to its relationship with Hanjin but to third parties as well. Read More
Hanjin Shipping’s Court Hearing Summaries
September 12, 2016
A notice provided by Caroll McNulty & Kull (CMK) Law Firm advises on Hanjin Shipping’s court hearing summaries staring with the September 7th event in which the United States Bankruptcy Court, District of New Jersey (“NJBC”), granted Hanjin temporary protection from creditors as a result of the Chapter 15 petition filed with the Court by Hanjin.
The Court issued a provisional order granting recognition of the Korean bankruptcy proceeding. Further the Court’s order extended to Hanjin the rights and protections afforded to bankrupt companies which file for bankruptcy in U.S. courts. The net effect of the order is to stay any litigation, administrative or other proceedings or actions against Hanjin and its assets. Read More
Guidance on Vessel Diversions for Hanjin Shipping Lines Cargo
September 12, 2016 – updated
On September 2, 2016, U.S. Customs and Border Protection (CBP) issued Cargo Systems Messaging Service (CSMS) #16-000788 providing direction on how to handle vessel diversions for Hanjin Shipping Lines cargo.
To assist the trade with any possible disruptions regarding vessels or cargo arriving in U.S. ports, CBP has provided a variety of scenarios to identify procedures for the trade and CBP to follow.
For news and updates, visit our website’s Hanjin Shipping Emerging Matters page. We will continue to monitor this situation closely and provide updates as relevant to your insurance and bonding concerns.
Please contact your Roanoke representative at 1.800.ROANOKE or email us at email@example.com with any concerns or questions and know we sincerely appreciate your business.
Formal Notice of Court Receivership and Executive Summary
September 8, 2016
Just nine days ago, Hanjin filed for court receivership after creditors rejected debt restructuring plans in favor of the South Korean shipping line, and news on developments have been forthcoming. Since Tuesday, Hanjin has issued a formal notice of court receivership and we have posted an executive summary issued by Roberts and Kehagarias to help you track the sequence of events that have taken place since then. Visit us often to stay tuned for upcoming Hanjin Shipping news and developments. In the meantime, should you have any questions or concerns, please call us at 1.800.ROANOKE or email us at firstname.lastname@example.org.
Freight Brokers, Shippers Concerned as South Korea’s Hanjin Shipping Files for Receivership
August 31, 2016
Hanjin Shipping, the largest container shipping company in Korea and seventh largest in the world, has filed for court receivership, according to a statement from Korea’s Financial Services Commission (FSC). The court protection was filed after support for its liquidity plan from South Korean Banks was denied, according to the Journal of Commerce. The liner carrier said it filed to begin a company reorganization in a district court in Seoul “to seek normalization of operation through commencement of company reorganization” with the decision about future plans to be decided after a court review of the application.
“In response to the market concern over the shipping sector, one of Korea’s key industries, the government will make sure to maintain the shipping industry’s competitiveness,” the FSC said. “Hyundai Merchant Marine will acquire Hanjin Shipping’s core assets such as ships, overseas sales network and key work forces to retain Hanjin’s competitiveness as much as possible.”
According to American Shipper, Hanjin has stopped taking bookings everywhere it operates and is doing its best to accommodate cargo in transit, but has been shut out of many terminals, ports and railroads. In fact, Reuters quoted a company spokeswoman as saying that ports in Shanghai and Xiamen in China; Valencia, Spain; and Savannah, Georgia had blocked access to Hanjin ships on concerns they would not be able to pay fees (this has yet to be confirmed, however, by American Shipper).
On the heels of this news, freight brokers and shippers are looking to find space with other carriers as Hanjin was immobilized in the midst of the busiest season for exports out of Asia. Asia-based freight brokers estimate Hanjin’s daily capacity at 25,000 shipping containers, cites the Wall Street Journal (WSJ).
The WSJ also cited the U.S.’s two largest container ports, in Los Angeles and Long Beach, California, were each expecting the arrival of a Hanjin ship on Wednesday. According to the director of the Marine Exchange of Southern California, which keeps tabs on vessels arriving and departing and directs ship traffic, both vessels have dropped anchor off the coast and canceled plans to berth in the ports.
At Roanoke Trade, we understand our clients’ concerns about the impact this development may have on cargo currently on board Hanjin vessels or while in their custody at various ports. If you have a specific concern regarding your insured cargo, please contact the Roanoke Claims Services team at 1-847-969-7064.
The best course of action at this time is to pursue all reasonable measures to protect the cargo and to ensure it is forwarded to the intended destination should Hanjin fail to complete the voyage(s). In such cases, the assured may be reimbursed for charges properly and reasonably incurred, as per the policy terms and conditions.
Your Roanoke team is closely monitoring this situation and will post any new developments on our website. Visit our Emerging Matters page at www.RoanokeTrade.com. If you have questions or concerns, please call Roanoke Claims Services at 1-847-969-7064 or email us at MarineClaims@RoanokeGroup.com