SEOUL • South Korea's financial regulator said Hanjin Shipping will seek stay orders in 43 countries to protect its vessels from being seized after its court receivership filing last week roiled companies' supply chain before the year-end shopping season.
Applications in 10 countries will be made this week and the remainder soon, the Financial Supervisory Commission (FSC) said in a statement yesterday. Hanjin Group, owner of the shipping line, should also take more action to account for the "chaos" caused, FSC chairman Yim Jong Yong said.
Vessels of Hanjin, the world's seventh-largest container carrier with a 2.9 per cent market share, are getting stranded at sea and ports after the box carrier sought protection, hurting the supply of LG Electronics television sets and other consumer goods ahead of the holiday season.
Hanjin Shipping shares resumed trading yesterday and, during the session, erased losses to rally as much as 18 per cent. It ended at 1,070 won, down 13.7 per cent. The stock is now more than 40 per cent off from a month ago and 80 per cent down over the year.
"Retail investors are hoping for the best on false hopes," said Mr Park Moo Hyun, an analyst at Hana Financial Investment. "They think that government measures to help resolve the supply-chain disruptions could mean it's also supporting Hanjin Shipping. They don't seem to realise that that's the wrong conclusion."
The commission said 79 of Hanjin's vessels, including 61 container ships, have had their operations disrupted. Hanjin Group chairman Cho Yang Ho and Korean Air Lines, the shipping company's largest shareholder, should take steps to ease the disruptions, Mr Yim said.
Hanjin Shipping declined to comment on applications for stay orders and Mr Yim's comments. Korean Air Lines also declined to comment.
The Seoul Central District Court accepted Hanjin's filing for receivership on Sept 1 and asked for a revival plan to be submitted by Nov 25.
While shares of Hyundai Merchant Marine dropped 3.6 per cent yesterday, other container lines in Asia - such as Orient Overseas International, Nippon Yusen, Mitsui OSK Lines and Kawasaki Kisen Kaisha - all rallied.
The government will focus its efforts on easing the supply-chain disruptions by finding ways to get cargo unloaded from Hanjin's ships worldwide, Vice-Finance Minister Choi Sang Mok said at a briefing yesterday. After the goods are unloaded, they will be sent on other ships or by land to customers.
The government does not plan to inject public funds or provide guarantees for Hanjin's debt to prop up the company, Mr Choi said.
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