Beijing targets Hanwha Ocean subsidiaries in trade retaliation move

China imposed sanctions on five US subsidiaries of South Korean shipbuilder Hanwha Ocean Co Ltd, escalating trade tensions as Beijing retaliates against what it calls illegal US investigations into Chinese maritime, logistics and shipbuilding industries.

The Chinese Ministry of Commerce announced the counter-sanctions against Hanwha Shipping LLC, Hanwha Philly Shipyard Inc., Hanwha Ocean USA International LLC, Hanwha Shipping Holdings LLC and HS USA Holdings Corp, effective Oct. 14, according to a ministry order signed by Commerce Minister Wang Wentao.

The sanctions prohibit Chinese organizations and individuals from conducting transactions or cooperation with the five entities.

The move represents Beijing's response to US Section 301 trade investigations targeting China's maritime sector, which Chinese authorities say violate international law and harm the legitimate interests of Chinese companies. China's National Coordination Mechanism for Countering Foreign Sanctions approved the retaliatory measures under the country's Anti-Foreign Sanctions Law.

The sanctions highlight growing friction between Washington and Beijing over trade practices in strategic industries, including shipbuilding, where China dominates global production capacity.

The US has increasingly scrutinized Chinese maritime companies and their international operations as part of broader economic competition between the world's two largest economies.

The Chinese commerce ministry stated that Hanwha Ocean's US subsidiaries assisted and supported the US government's investigation activities, thereby endangering China's sovereignty, security and development interests.

The timing of the announcement, coinciding with ongoing global supply chain pressures in the shipping industry, could further strain maritime trade flows between major economies. Chinese entities now face legal restrictions on engaging with the sanctioned Hanwha units, potentially affecting ship construction projects, shipping services and related maritime activities.