A hull section that will be sent to the final assembly base is loaded onto a semi-submersible vessel at Hanwha Marine Engineering (Shandong) Co LTD in Yantai, China, on September 16, 2024.
Costfoto | Nurphoto | Getty Images
Shares of South Korean shipbuilder Hanwha Ocean fell more than 8% Tuesday after China sanctioned five of its U.S. subsidiaries, escalating tensions with Washington over their alleged involvement in a probe into the Chinese shipping industry.
The sanctioned subsidiaries are Hanwha Shipping LLC, Hanwha Philly Shipyard Inc., Hanwha Ocean USA International LLC, Hanwha Shipping Holdings LLC, and HS USA Holdings Corp, according to a statement from China’s Commerce Ministry.
“Hanwha’s subsidiaries in the U.S. have assisted and supported the U.S. government’s probes and measures against Chinese maritime, logistics and shipbuilding sectors. China is strongly dissatisfied and resolutely opposes it,” a spokesperson at Mofcom said in a separate statement, translated by CNBC.
The order, effective immediately, will prohibit Chinese organizations and individuals from doing business with the sanctioned companies, the ministry said, adding that the move was intended to safeguard China’s sovereignty and security.
Hanwha Ocean did not immediately respond to CNBC’s request for comments.
Earlier Tuesday, Beijing confirmed it had begun collecting the additional port fees on U.S.-linked vessels while clarifying that Chinese-built ships would be exempted from the charges.
The move followed the U.S. decision to impose steep fees on Chinese ships docking at American ports starting Tuesday at 12:01 a.m. EDT. China retaliated with a similar charge of 400 yuan ($56) per net ton on American vessels, starting on the same day. Container vessels can range from 50,000 to 220,000 tons.
Beijing has also unveiled a new framework for restricting rare earths exports and expanded its blacklist of U.S. companies. In response, U.S. President Donald Trump threatened to impose 100% more tariffs on Chinese imports, prompting Beijing to assert its rare earths restrictions as a “legitimate” measure.
In a separate statement, China’s Ministry of Transport said it had launched an investigation into the impact of Washington’s Section 301 probe on Chinese shipping and shipbuilding industries.
The ministry said the inquiry will also assess whether companies, organizations or individuals helped the U.S. in “undertaking discriminatory restrictive behaviours” against China’s shipping supply chain.