EMEA News
Creditors Expected to Turn to ARA Region to Arrest Vessels
Haco van der Houven van Oordt, a partner in Rotterdam law firm AKD, says creditors of bankrupt companies including STX Pan Ocean and Tomorrow Makes Tomorrow (TMT) could use favourable laws in the Amsterdam-Rotterdam-Antwerp (ARA) region to arrest vessels, Maritime Executive reports.
"The recent reports of bankruptcies and voluntary liquidation proceedings involving shipping companies have now reached levels which exceed any in recent memory," he said.
The lawyer noted that STX Pan Ocean, South Korea's largest dry bulk shipper, is seeking recognition of protection orders to protect it from creditors arresting a "significant part of its fleet operating around the world."
He said bankruptcy protection does not apply everywhere in the world.
"It is reported that several of STX Pan Ocean's creditors have already arrested vessels in China, and we expect creditors also to turn to the Netherlands, which adopts a territorial approach to bankruptcy," he said.
"This means that creditors can still take action against the assets of STX Pan Ocean in the Netherlands despite the existence of bankruptcy proceedings and protection orders."
The Netherlands makes it relatively easy to take action against ships based on debts owed by their owners, which means that vessels calling at Rotterdam and Amsterdam, as well as those going over the River Scheldt to Antwerp and Ghent, could face arrest.
"It would be surprising if we did not see creditors looking increasingly to the ARA region in the wake of the continuing fall-out from the bankruptcies of major shipping groups," Houven van Oordt said.
TMT announced last week that 23 of its affiliated single-ship companies had filed for bankruptcy protection, and STX Pan Ocean has had several vessels arrested since filing for bankruptcy earlier this month.
