The Olongapo City Regional Trial Court (RTC) Branch 72 on Monday (January 14) granted Hanjin Heavy Industries and Construction-Philippines’ petition for receivership and put the Korean shipbuilding firm under corporate rehabilitation.
On Jan. 8, Hanjin sought relief from the Philippine government, filing a petition with the Olongapo RTC to initiate voluntary rehabilitation under Republic Act 10142 or the “Act Providing for the Rehabilitation or Liquidation of Financially Distressed Enterprises and Individuals.”
Hanjin, the fifth largest shipbuilder in the world and biggest investor at the Subic Freeport with $2.3 billion, revealed recently it owes some $400 million in outstanding loans from Philippine banks on top of another $900 million in debt with lenders in South Korea.
Stefani Saño, a former member of the Subic Bay Metropolitan Authority (SBMA) board as well former senior deputy administrator for investment and business group of SBMA, was appointed by the court as the rehabilitation receiver.
The financial losses allegedly stemmed from a slump in the shipbuilding industry.
Pursuant to RA 10142, Olongapo RTC Branch 72 Presiding Judge Richard Paradeza declared Hanjin under rehabilitation and asked the company to publish the Jan. 14 commencement order in a newspaper of general circulation for two consecutive weeks.
It also ordered the shipbuilding giant to serve a copy of the petition to its creditors – the Bureau of Internal Revenue, Securities and Exchange Commission, Bangko Sentral ng Pilipinas, Insurance Commission, Department of Labor and Employment (DOLE), Housing and Land Use Regulatory Board, Department of Trade and Industry and SBMA.
The court also tasked the company to serve a copy of the commencement order to its foreign creditors and ensure that they receive a copy within 15 days before the initial hearing set on Feb. 8.
In its order, the court said Hanjin’s creditors must file verified claims within five days before Feb. 8 or they will not be entitled to participate in the proceedings.
But the creditors may be entitled to receive distributions arising from the proceedings if recommended and approved by the rehabilitation receiver and the court itself.
The court also ordered creditors, government agencies and all interested parties to file and serve to Hanjin a verified comment/opposition to the petition, together with their supporting affidavits and documents within 15 days before the initial hearing on Feb. 8.
The court also prohibited the company’s supplier of goods and services from withholding their supplies and services in the ordinary course of business for as long as Hanjin makes payment from the issuance of the commencement order.
The court also authorized the company to pay for its administrative expenses as they become due.
It said contracts not confirmed in writing by Hanjin within 90 days following issuance of the commencement order will be considered terminated. (Bebot Sison Jr. with Sheila Crisostomo, Philippine Star)
https://www.philstar.com/headlines/2019/01/16/1885490/rtc-grants-hanjin-petition-rehabilitation#0ezcQ5IYvTgXVUm0.99
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