The Japanese government has formally filed dispute proceedings against South Korea to the World Trade Organisation (WTO) over alleged shipbuilding subsidies, according to national media.
Japan’s reported request for a WTO investigations follows on from its initial complaint in November 2018 when it claimed the South Korean government had broken rules on state aid, a story Port Technology International reported on.
The case specifically focused on Hyundai Merchant Marine’s (HMM) purchase of 20 LNG-powered mega-ships on 28 September 2018.
The deal’s funding was reported to be partly arranged by the Korea Ocean Business Corporation, a government-owned business established in July 2018 to support the country’s shipping sector.
The order was made to struggling South Korean shipbuilding companies Daewoo Shipbuilding and Marine Engineering Co., Samsung Heavy Industries Co. and Hyundai Heavy Industries.
Protocol in WTO dispute consultations require both sides to begin talks within 30 days. If Japan and South Korea fail to resolve the matter themselves, the WTO will investigate.