An American court temporarily approved Hanjin Shipping’s application for bankruptcy protection. The approval will enable Hanjin Shipping vessels to dock at U.S. ports without fear of being seized.
Judge John Sherwood of the U.S. Bankruptcy Court in Newark, N.J. granted Hanjin Shipping temporary bankruptcy protection, the Wall Street Journal reported on September 6. The US judge said that he will check Hanjin Shipping’s measures to protect its creditors through an additional trial.
Bankruptcy protection in America is similar to Korea’s court receivership. On September 2, Hanjin Shipping filed for bankruptcy protection under chapter 15 which deals with international insolvency situations to the US court. The court ruling will preclude creditors from seizing the shipping company’s assets in the US and proceeding with other legal steps.
As a consequence, Hanjin Shipping vessels can enter US ports without worrying about being seized for the time being thanks to the US bankruptcy protection law. Hanjin Shipping has been keeping its vessels waiting off the US coast such as Long Beach Port in California due to a possibility that creditors will attach them.
But this decision does not guarantee that the vessels will be able to unload cargoes. It was not clear whether or not Hanjin Shipping under court receivership has money to spare to employ dockers in order to unload cargoes, the Wall Street Journal explained.
At the moment, US dockers and transporters are refusing to unload and move cargoes from Hanjin Shipping vessels for the fear of not getting paid for their services.