China barred its companies from conducting business with five US-based subsidiaries of Hanwha Ocean Co., striking at the South Korean shipbuilder for its involvement in a Washington investigation into Chinese maritime dominance.
The Ministry of Commerce in Beijing announced the sanctions Tuesday, citing the units’ participation in the Section 301 probe that the US Trade Representative launched in April 2024. The targeted entities include Hanwha Philly Shipyard Inc., Hanwha Shipping LLC, Hanwha Ocean USA International LLC, Hanwha Shipping Holdings LLC and HS USA Holdings Corp.
Hanwha Ocean’s shares closed 5.8% lower in Seoul following the announcement, having fallen as much as 8% during trading. The move extends Beijing’s retaliation against Trump administration efforts to rebuild American shipbuilding capacity.
The sanctions coincide with both nations implementing reciprocal port fees on each other’s vessels — measures that took effect Tuesday as the trade dispute intensifies. Washington determined last year that China’s shipbuilding strength constitutes an unfair burden on US businesses.
Seoul’s Foreign Ministry said it would assess the impact and work with relevant parties to minimize damage to Hanwha and related Korean industries. The shipbuilder announced a $5 billion investment in Philly Shipyard in August and secured US Navy maintenance contracts, while withdrawing from a Chinese joint venture in May.
The penalties illustrate how South Korea finds itself squeezed between its security ally and largest trading partner as US-China tensions escalate.
