The government has finished preparations and decided to launch next month a transfer consultative body to move the headquarters of domestic shipping companies, including HMM, to Busan. The consultative body will be organized by the Ministry of Oceans and Fisheries as the lead agency to promote President Lee Jae-myung's pledge to transfer private shipping corporations to Busan. However, unlike the initial plan, private shipping corporations were left out of the consultative body.
According to the shipping industry on the 18th, the Ministry of Oceans and Fisheries (MOF) recently finalized a plan to form a large shipping company transfer consultative body (tentative name). Institutions and experts, including the MOF, the Korea Shipowners' Association (KSA), and the Busan Chamber of Commerce and Industry, will participate in the consultative body. The first meeting is expected to be held after Dec. 2, the legal deadline for handling the budget review, as the schedules of the MOF Vice Minister and related officials are uncertain due to next year's budget review.
The Ministry of Oceans and Fisheries (MOF) plans to establish an incentive plan through the consultative body to entice private shipping companies to transfer their headquarters to Busan. Previously, at the Shipping Corporations Transfer Promotion Committee organized by the city of Busan, the necessity of tax and fiscal support and regulatory special cases was discussed, and it appears that such support plans can be fleshed out.
The Ministry of Oceans and Fisheries (MOF) intends to have shipping companies voluntarily move their headquarters through various incentives. In addition, beyond HMM's headquarters, which was part of President Lee's pledge, it also aims to bring the headquarters of H-Line Shipping and SK Shipping to Busan. By attracting many shipping companies' headquarters to Busan, the goal is to complete the creation of President Lee's pledged "maritime capital Busan."
However, contrary to the previous remarks by Minister Jeon Jae-su of the Ministry of Oceans and Fisheries (MOF) that "we plan to form and operate a consultative body with the participation of the government, local governments, the local community, and shipping companies," private corporations were excluded from the composition of the consultative body. This appears to reflect strong backlash against the transfer among private corporations, including HMM. The MOF reportedly checked with each institution about the matter before forming the consultative body, but shipping companies did not convey any particular opinions.
In the industry, there is a response that the MOF's formation of the consultative body is not appropriate. If there is a policy need for shipping companies to transfer their headquarters, the government should first build consensus by communicating with the private sector; forming a consultative body on the premise of a transfer is out of order and, from the corporations' standpoint, inevitably burdens participation.
An industry official said, "Carriers conduct cargo transportation sales based in Seoul, so a transfer is not easy," and added, "If you suddenly propose discussing incentives on the premise of a transfer to carriers that had not even considered moving their headquarters, what corporation would participate?"
The Ministry of Oceans and Fisheries (MOF) said, "The transfer support consultative body is an organization to consult and identify in advance, with related institutions, incentives to induce the transfer of shipping corporations, and it is not premised on shipping corporations that have decided to transfer," and added, "Since we have reviewed including the association as a member from the initial stage of forming the consultative body, we will sufficiently gather the opinions of private carriers through the association and create a favorable business environment."