I COMMERCIAL OVERVIEW OF THE SHIPPING INDUSTRY

Although the downturn in the maritime and shipping industry has been continuing for a while, Korea maintained its position as the fifth largest state in the industry. As of 2018, 1,614 ocean-going commercial vessels up to 80 million gross tonnage were owned or operated under bareboat charter hire purchase (BBCHP) by Korean shipping companies. Among them, 706 vessels of 12.8 million tonnes were directly owned by the Korean shipping companies.2

The total volume of cargoes handled in Korean ports in 2018 increased by 4.3 per cent compared with the volume in 2017, amounting to 1.574 million revenue tonnes.3 Not only the major ports such as Busan have shown an increase in the volume, but bulk cargoes through Daesan and Mokpo port also saw a twofold increase in 2018.

With regard to the shipbuilding industry, Korean shipyards were able to reclaim the first rank in shipbuilding contracts amounting to 10.9 million compensated gross tonnage (CGT) due to the recovery of the industry, part of the recovery being based on the support from the Korea Ocean Business Corporation established in 2018. 10.6 million CGT was built in 2018 and the backlog amounts to 20.7 million CGT.4

II GENERAL OVERVIEW OF THE LEGISLATIVE FRAMEWORK

The fundamental domestic legislation providing for the carriage of goods by sea and admiralty issues is the Commercial Code. Chapter 5 of the Commercial Code covers maritime matters such as captain's rights and responsibility, global limitation of liabilities, maritime lien, contracts to carriage of goods and charter parties, collision, salvage and general average.

There are several other statutes regulating specific subjects; for example, the Marine Transportation Act to regulate shipping-related business from an administrative perspective, and pilotage, crew, procedures for limitation of liabilities and investigation of marine accidents, which are governed by applicable regulations.

Upon ratification by the Korean government, international conventions are granted the authority equivalent to national statutes under Article 6 of the Constitution. Korea has ratified the Convention on the International Maritime Organization 48, the SOLAS Convention 74 and its Protocols 78 and 88, the Load Lines Convention 66 and its Protocol 88, the Tonnage Convention 69, the COLREG Convention 72, the International Convention for Safe Containers 72, the STCW Convention 78, the Search and Rescue Convention 79, the IMSO Convention 76, the INMARSAT OA 76, the Facilitation Convention 65, the MARPOL (73/78) and its Protocol 97, the London Dumping Convention 72 and its Protocol 96, the CLC Protocols 76 and 92, the Fund Protocol 92 and 2003, the SUA Convention 88 and its Protocol 88, the OPRC Convention 90, the OPRC-HNS Protocol 2000, the Bunkers Convention 01, the Anti-Fouling Convention 2001 and the Ballast Water Management Convention 2004.

III FORUM AND JURISDICTION

i Courts

There is no independently established court dedicated to handling maritime and admiralty matters, yet there are number of departments in the district and the appellate courts specialised in maritime matters. The maritime department of the district court shall hear the case at the first instance. The unsuccessful party may appeal against the first instance judgment to the Appellate Court, and then finally to the Supreme Court.

In principle, the successful party would be entitled to recover legal costs from the opposing party, but the amount of recoverable costs is substantially restricted depending on the claim amount under the regulation.

The hearings will take place consecutively at approximately four-week intervals, and written briefs and documentary evidence shall be submitted in preparation for the hearings. Each hearing will be conducted for a short period (under an hour), mainly for the judges to confirm the arguments and evidence from each party.

With regard to the evidence, the full disclosure procedure is not available under Korean law, although a party may apply to the court to order the other party to disclose 'specific' documents. Witness evidence and expert evidence are usually available at the court's discretion.

Procedural issues of jurisdiction and governing law will be determined pursuant to the Civil Procedure Act (CPA) and the Private International Law Act (PILA). An agreement between the parties on the exclusive jurisdiction is recognised as valid unless such jurisdiction lacks a reasonable link to the case or the agreement is contrary to public order.5 With respect to the conflict of laws, PILA provides general governing law for contracts and torts, as well as for certain maritime issues of the ownership to a vessel, maritime lien, as well as the governing law for certain maritime issues, such as the ownership to a vessel and, importantly, maritime lien. According to the PILA, the ownership to and maritime lien upon a vessel are to be determined based on the law of the vessel's flag state.6

The limitation period or extinctive prescription, which is regarded as an issue of substantive law under Korean law, differs depending on the nature of the claim. The limitation period would be 10 years for a general civil claim, but for a commercial contractual claim it would be five years from the occurrence of the claim.7 The limitation period for a tort claim is either three years from the date on which the injured party became aware of damages or 10 years from the date of the occurrence of the tort, whichever occurs earlier.8 However, certain claims are subject to a one-year limitation period, including (1) claims among the parties and the consignee to the contract of carriage of goods by sea counting from the date of delivery of goods; and (2) contribution claims under a general average counting from the completion of calculation.9 A two-year limitation period is applicable to (1) claims among the parties and the consignee under a voyage charter counting from the delivery date of the goods; (2) claims between the parties to a time charter party or a bareboat charter party counting from the redelivery date of the vessel; (3) damages claims arising from a collision counting from the date of the collision; and (4) salvage remuneration counting from the completion of salvage.10

With regard to maritime accidents, the Marine Safety Tribunal (MST), an administrative tribunal established under Act on the Investigation of and Inquiry into Marine Accidents, will decide on the penalty against the liable seafarers and the contributory negligence between the parties involved, provided that the parties had requested so. The decision of the MST is not legally binding upon the relevant parties regarding the liability issues, but is respected in other proceedings in practice.

ii Arbitration and ADR

The Korean Commercial Arbitration Board (KCAB) serves as a general arbitration board. Further, Seoul Maritime Arbitrators Association (SMAA) supports ad hoc arbitration proceedings for maritime disputes exclusively.

Limitation period or extinctive prescription in arbitration is identical to those in litigation before the courts, as long as the governing law is Korean law.

Aside from the arbitration, other means of ADR is not widely utilised in Korea.

iii Enforcement of foreign judgments and arbitral awards

To enforce a foreign judgment, an enforcement judgment is required from a Korean court, which will not judge the merits of the foreign judgment, but only determine whether the statutory requirements under Article 217 of the CPA are met for the foreign judgment, which should be final and conclusive.

The requirements are that (1) the jurisdiction that rendered the judgment should be competent under Korean law or international conventions ratified by Korea; (2) the parties were properly served with relevant documents for the proceedings of the foreign judgment; (3) no violation of public order of Korea is present; and (4) the reciprocity exists between Korea and the state of the jurisdiction that rendered the judgment.

In practice, the reciprocity requirement tends to be an issue, as there are not many precedents to refer to. Korean courts have recognised reciprocity between Korea and the United States (usually for the states that adopted Uniform Foreign Country Money-Judgments Recognition Act11), Japan12 and Ontario, Canada,13 but denied reciprocity between Korea and Australia.14 In cases of lower court judgments, reciprocity has been recognised for English judgments and Chinese judgments.

Korea ratified the New York Convention 1969, thus arbitral awards rendered in the signatory state of the Convention would be enforceable. To enforce arbitral awards, the successful party will have to obtain an enforcement judgment from the court, which will not judge the merits of the case unless matters of public order arise.

Limitation periods applicable to the enforcement of foreign judgments and arbitral awards are regarded as substantive issues, and thus will be decided by the governing law of such judgments or arbitral awards.

IV SHIPPING CONTRACTS

i Shipbuilding

Most shipbuilding contracts with Korean shipyards are concluded based on the SAJ Form, with some variations. They are usually subject to English law, with disputes arising therefrom usually being referred to LMAA arbitration.

Korean law will inevitably apply to the title to and ownership of the vessels under construction at the shipyards in Korea, particularly before delivery under the shipbuilding contracts. While the parties are at liberty to agree on the issue, the builder, based upon the SAJ Form, would likely acquire the title to a vessel under construction and then, at delivery, transfer to the buyer.

However, it appears that a vessel under construction is usually provided as security to a bank issuing a refund guarantee (RG) for the shipbuilding contract, and the title to the vessel under construction is transferred for security purposes to the RG-issuing bank. Thus, should the buyer apply to the court for an injunction for delivery of the vessel or an arrest of the vessel, the verification of the title to the vessel between the builder and the bank could become an issue.

ii Contracts of carriage

Contracts of carriage are regulated by the Commercial Code in Korea. Korea has not ratified any of the Hague or Hague-Visby Rules, the Hamburg Rules or the Rotterdam Rules, but incorporated some provisions of the Hague-Visby Rules into the Commercial Code in 2007. The Commercial Code provides for rights and obligations of the parties in bareboat charter party, time charter party, voyage charter party and other contracts for carriage of goods by sea.

Pursuant to the Commercial Code, the carrier owes the duty of care regarding seaworthiness of the vessel and the goods, and will be liable for damages unless it is proven that those duties of care are fully met. In the case of general carriage of goods by sea contracts, carriers' liability should not be reduced from the provisions of the Commercial Code;15 this prohibition is also applicable to bills of lading even when they are issued under charter parties.

The shipper is obligated to present the goods to the carrier at the time and place designated in the agreement or pursuant to practice in the loading port, and to submit the documents required for the carriage of goods to the captain within the loading period.

The carrier or shipowner, including beneficial owners, are obliged to issue bills of lading at the request of the shipper or charterer after the carrier or shipowner has received the goods.

The carrier and the captain may exercise maritime lien in relation to the cargoes. They are entitled to refuse to deliver the goods until freight or hire is paid in full and to sell the goods by auction after obtaining the court's approval to recover the unpaid freight or hire from the auction proceeds.16 These articles are also applicable to voyage charter parties and time charter parties.

With respect to multimodal transport, Commercial Code17 has adopted a network liability system to provide that the carrier's liability will be subject to the applicable law of each specific mode of transport where loss has occurred. If the leg where loss occurred is unclear or the loss was extended to multiple modes of transport, the carrier's liability will be subject to the applicable law of the leg covering the longest distance. If it is impossible to confirm which leg is the longest, then the applicable law of the leg with the highest freight prevails.

Cabotage between Korean ports is exclusively allowed to domestic shipping companies.18

iii Cargo claims

Cargo claims under Korean law are not too different from general civil or commercial claims. The lawful holder of bills of lading, who has the rights to the cargoes, usually holds the title to sue, and also its insurers, if they are subrogated to the rights of the holder through payment of the insurance proceeds. In some cases, the shipper or the consignee named in the bills of lading may have the title to sue under particular circumstances.

It would be the carrier who is liable for cargo claims in general, but in practice it would often be difficult to point out who the carrier is in a particular case, which will often be an issue of fact-finding. Along with the carrier, employees and agents of the carrier or shipowner and the demise charterer could be the target of the suit, and are entitled to the defences and limitation of liability applicable to the carrier, shipowner and demise charterer. Independent contractors of carriers are not entitled to carriers' defences and limitation of liability, unless the Himalaya clause is applicable.19

With respect to the damages, loss and damages directly arising from the carriage shall be recoverable in principle. However, in the case of the contract of carriage, recoverable damages are limited under the Commercial Code and will be calculated by the price of the cargo at the destination as at the date (1) when the cargo would have been delivered in the case of total loss or delay, or (2) when the cargo was actually delivered in the case of partial loss. Nevertheless, should the loss, damage or delay result from the carrier's wilful misconduct or gross negligence, the carrier is liable for the full loss and damages directly attributable to such misconduct or negligence, less any freight or expenses saved because of the loss, damage or delay.20

Whether charter party terms are validly incorporated into a bill of lading is an issue to be determined pursuant to the law applicable to the bill of lading, which will be the law of the place where the bill of lading was issued unless there is agreement thereon between the parties to the bill of lading. In particular, regarding incorporation of arbitration clauses in charter parties between the carrier and the holder of the bill of lading, the Supreme Court21 held that an arbitration clause in a charter party would be considered to be validly incorporated into a bill of lading only if:

  1. the bill of lading provides that the arbitration clause is incorporated with a reference to the charter party or the holder of the bill of lading is aware of the charter party with the arbitration clause therein; or
  2. the bill of lading provides that every term of the charter party is incorporated and the holder of the bill of lading is aware of the existence and contents of the arbitration clause, which is not inconsistent with other terms of the bill of lading and its wording sufficiently applies to a third-party holder of the bill of lading.

A demise clause is not valid as it is regarded to be reducing the liability of the carrier.22 However, in an Appellate Court case, in which a foreign law was the governing law to a contract of carriage, and the foreign law recognised the validity of demise clauses, it was held that a demise clause was valid.23

iv Limitation of liability

With regard to global limitation of liability, Korea has incorporated a substantial part of the LLMC Convention 76 (and part of the LLMC Protocol 96 for limitation amounts in respect of a passenger's death or injury) into the Commercial Code,24 but has not ratified any of the above Conventions. However, as Korea is not a signatory to the Convention, the constitution of funds in Korea would not bar claimants from exercising their rights in another jurisdiction or vice versa. A person entitled to global limitation must apply to the court for commencement of limitation proceedings within one year of receiving a claim letter.25

Package limitation under the Commercial Code26 is the same as that under the Hague-Visby Rules, namely the higher of 666.67 special drawing rights (SDRs) per package or unit and 2 SDRs per kilogram, although Korea has not ratified the Hague-Visby Rules.

The procedure for the limitation of liability is set out in the Act on the Procedure for Limiting the Liability of Shipowners et al.

V REMEDIES

i Ship arrest

Korea has not ratified any conventions in this respect.

Under Korean law, there are two distinct types of arrest. One is to enforce claims for final satisfaction (based upon an enforceable judgment, a mortgage or a maritime lien), and the other is by way of prejudgment attachment for the purpose of obtaining security for either domestic or foreign judgment or arbitral award to be rendered in the future. The distinction is stringent and thus it is crucial to determine at the outset which process is to be followed; for example, an arrest by way of prejudgment attachment where the claim attracts a maritime lien could be revoked.

In any case, the arrest is available only if the target vessel is legally owned by the person who is liable for the claims. The only exception would be an arrest based on a maritime lien, when the target vessel may be arrested irrespective of the owner's identity once the maritime lien is imposed on the target vessel. Thus, it is very difficult to arrest a sister vessel or an associated vessel in Korea.

The court having jurisdiction over the location of the vessel shall be able to render the arrest order. The application for the arrest is made ex parte, and an application for a maintenance and preservation order for physical custody of the target vessel usually follows the application for the arrest. Once an arrest order is rendered, the court officer will serve the order on board the vessel by which the enforcement of the arrest will be completed.

In the case of a prejudgment attachment arrest, the applicant is required to provide counter-security to the court in an amount equivalent to 10 per cent of the claim amount either in cash or by a guarantee insurance policy at the court's discretion. On the contrary, regarding an arrest for enforcement of claims, counter-security is not required but expenses for a court sale are required to be paid to the court, as upon the court's arrest order the court sale automatically commences. For maintenance and preservation for the custody of the vessel, it is usual practice for the applicant to pay the fees for the first month as the application is made.

The prejudgment attachment arrest must be followed by legal proceedings on the merits of the claim before the agreed jurisdiction or arbitration, where the arrest to enforce the claim may be based upon an enforceable judgment already rendered on merits, or if it is based upon a maritime lien or a mortgage, the vessel interests will have to challenge the arrest order before a Korean court. Meanwhile, the vessel interests, usually in the name of the registered owner, may apply to the court for the release of the vessel by providing security of the total amount claimed in cash, unless otherwise agreed with the applicant. The security for the release of the vessel will be regarded as a substitute for the vessel or the sale proceeds.

If the claimant's claim turns out to have been groundless, the claimant would be liable for the wrongful arrest in tort. The claimant would then need to prove that it was not negligent to deny such liability, and may have to compensate the shipowner for the loss of trading during the arrest period and, if the ship was released on security, the interest accrued on the security amount.

The jurisdiction of the court reaches beyond the port limit, and thus a vessel at anchor in territorial waters but not within the port limit can be arrested. However, it is unprecedented to use a helicopter in a vessel arrest.

ii Court orders for sale of a vessel

An arrest based either upon an enforceable judgment or security rights such as a mortgage or a maritime lien shall commence court sale proceedings of the vessel. In the case of a prejudgment attachment arrest, court sale proceedings may be commenced once an enforceable judgment (in the case of an arbitral award, the enforcement judgment in Korea to enforce the award) is obtained from the court.

The court will have the vessel valued and its condition appraised. Meanwhile, other claimants against the shipowner or entitled to a maritime lien can file their claims with the court. Within one month of the expiry of other claimants' filing period, the court will have a notification of the court sale published in newspapers. The court will determine the highest bidder and decide whether to approve the sale. The sale proceeds will be distributed to the claimants and the shipowner according to the priority listings determined after the hearing for the distribution of the proceeds.

VI REGULATION

i Safety

Korea has ratified the following international conventions in respect of safety: the Load Lines Convention 66 and its Protocol 88, the Tonnage Convention 69, the COLREG Convention 72, the International Convention for Safe Containers 72, the STCW Convention 78, the Search and Rescue Convention 79, the INMARSAT OA 76, the Facilitation Convention 65, SUA and Protocol 88. The legislation in this respect includes the Ship Safety Act and the Maritime Safety Act.

Korea is one of the White List countries of the IMO.

ii Port state control

Korea is a member of the Tokyo MOU. The authority in charge is the Ministry of Oceans and Fisheries. The legislation in this respect includes the Ship Safety Act, the Ship Act, the Seafarers Act, the Ship Employees Act, the Maritime Safety Act and the Marine Environment Management Act.

Under the above regulations, the port authority under the MOF, in 2017, inspected 2,931 vessels (inspection rate of 29 per cent) and detained 66 vessels (detention rate of 2.3 per cent).27

iii Registration and classification

There are two registries applicable to ships in Korea. One ship register is managed by the courts, which provides ownership, bareboat charter, securities such as a mortgage, court arrest orders and injunction orders, etc. The other ship register is operated by regional port authorities, which deals mainly with administrative issues when obtaining licences.

Both registers are only available for vessels owned by Korean legal entities (including companies).

Many members of the International Association of Classification Societies operate in Korea, as Korea is renowned for its shipping and shipbuilding businesses. Among them, the Korean Register is authorised by the Korean government to conduct ship surveys and issue certificates on behalf of the government.

It seems to be generally accepted that a classification society will be held liable for the damages caused to others due to its neglect of duty of care to monitor and supervise the building of a defect-free ship, although there is not yet any published case directly addressing this issue. In a recent case involving dual classification for the same ship, the issue of whether a classification society shall be liable for the damages to others due to the neglect of duty of care by another society in approving defective designs wherein the former is supposed to accept the other's designs as approved and only monitor and supervise the shipbuilding as per such designs had to be determined; the first instance court held that the former classification society shall not be liable. This case is now pending at the appellate court.

iv Environmental regulation

Korea has ratified MARPOL (73/78) (Annexes I to V) and its Protocol 97 (Annex VI), the OPRC Convention 90 (and OPRC-HNS Protocol 2000), the CLC Convention Protocols 76 and 92, the Oil Pollution Fund Convention Protocols 92 and 2003, the Bunker Convention 2001, the Anti-Fouling Convention 2001 and the Ballast Water Management Convention 2004. The legislation in this area includes the Marine Environment Management Act and the Clean Air Conservation Act.

v Collisions, salvage and wrecks

Collision

Korea has not ratified any collision convention. The Commercial Code deals with collisions in Articles 876 to 881.

If a collision case is brought before a Korean court, it will decide whether the applicable law is (1) the law of the country of the territorial water where the collision took place, or (2) the law of the flag of the vessel at fault in the case of a collision on the high seas.

If Korean law applies, the victim shall bear the loss or damage and will not be entitled to claim damages if the collision was caused by a force majeure or the cause of the collision is in doubt. If the collision was caused by the fault of the crew or pilot of one vessel, the owner of that vessel is liable for damages. If the collision was caused by the fault of the crew or pilot of both vessels, the owner of each vessel is liable in proportion to the degree of the respective faults; however, the owners of the vessels are jointly and severally liable for any death or injury. Damages claims arising from a collision will expire if a lawsuit is not brought within two years of the date of the collision, unless the parties agree to extend the limitation period.

As mentioned above, investigation of collision is mainly performed by the MST, overseeing an administrative trial on the cause of the accident to decide on the penalty against the liable parties and the contributory negligence between the parties involved. Such ratio of contributory negligence is likely to be referred to by the Korean court in relevant proceedings.

Salvage

Korea has not ratified the Salvage Convention 89. Salvage is dealt with in Articles 882 to 895 of the Commercial Code.

If a salvage remuneration claim is brought before a Korean court, it will decide the applicable law as follows: (1) the law of the country of the territorial water where the salvage operation took place; or (2) the law of the flag of the salvor vessel if the salvage operation took place on the high seas.28

If Korean law applies, a person who salvaged a vessel or cargo without obligation is entitled to appropriate remuneration not exceeding the price of the salvaged vessel or cargo, and if the amount of remuneration is not agreed between the parties, the court will make adjustments to the amount. If the salvage operation was such that prevented or minimised damage to the environment, the salvor is entitled to special compensation irrespective of the outcome. The remuneration claims for salvage will expire if a lawsuit is brought within two years of the completion of salvage, unless the parties agree to extend the period.

Wreck removal

Korea has not ratified the Nairobi WRC 2007. The legislation dealing with wreck removal includes the Act on Vessels Entering and Departing Port, the Marine Environment Management Act and the Maritime Safety Act.

The owner or the occupant of any object that causes or may cause a hindrance to a vessel's navigation, or the master, owner or operator of a vessel that causes obstruction in navigation, is obliged to remove the object or obstruction or bear the costs and expenses for its removal.29 The master of a vessel that causes certain pollutants to be emitted into the sea is obliged to report to the relevant authority and to take measures to prevent the spread and further emission and to remove the emitted pollutants, and to bear the costs and expenses of the operation.30

vi Passengers' rights

Korea has not ratified the Athens Convention or any protocols. Passenger carriage is dealt with in Articles 817 to 826 of the Commercial Code.

The carrier is liable for the death or personal injury of passengers unless the carrier proves that it or its employees were not negligent. The global limitation amount for a passenger's death or personal injury is in line with that of the LLMC Protocol 96, which Korea has not ratified.

vii Seafarers' rights

Korea has ratified the Maritime Labour Convention 2006, which came into force in Korea in January 2015. The major legislation in this area includes the Seafarers' Act, the Ship Employees Act and the Act on the Investigation of and Inquiry into Marine Accidents.

VII OUTLOOK

The shipping and shipbuilding industries in Korea have maintained a remarkable presence in the international market. Although the global recess in the shipping industry had a harsh impact on the Korean shipping industry, restructuring with support from public and private sectors has significantly improved the financial status of the shipping business in Korea, which is gradually making a recovery from the difficulties of the past years.

The shipbuilding industry, above all, has recovered significantly, securing 42 per cent of the total global shipbuilding contracts in 2018, which is attributable to the knowledge, expertise and experience accumulated over several decades along with financial support from the government-established Korea Ocean Business Corporation.

As indicated in previous editions of this chapter, the Korean government planned to authorise a foreign classification society in addition to the Korean Register to carry out safety surveys on vessels on behalf of the government. In late 2016, Bureau Veritas was designated as such.

Although there are no significant changes anticipated in the legal regime in the near future and it seems that Korea will continue to maintain the current legal framework on maritime law, establishment of maritime courts, dedicated to maritime issues exclusively, in Seoul and in major ports such as Busan and Incheon has been discussed in the National Congress. Further, setting up an international tribunal is being considered, allowing hearings and submission of evidence in foreign languages, in current court departments handling maritime matters. In any case, the Korean judicial system is expected to function as a competent jurisdiction for domestic maritime cases as well as foreign maritime cases under foreign governing law.


Footnotes

1 Jong Ku Kang is a partner and Joon Sung (Justin) Kim is an associate at Bae, Kim & Lee LLC.

2 Index on status of owned vessels by major leading states in shipping industry, Statistics Korea.

3 Index on traffic of goods in national ports, Statistics Korea.

4 World Shipyard Monitor, Clarkson Research.

5 Supreme Court Judgment, 26 August 2010, 2010Da28185.

6 Article 60 of the PILA.

7 Article 162(1) of the Civil Code, and Article 64 of the Commercial Code.

8 Article 766 of the Civil Code.

9 Articles 814 and 875 of the Commercial Code.

10 Articles 840, 846, 851, 881 and 895 of the Commercial Code.

11 Supreme Court Judgment, 28 October 2004, 2002Da74213. There are also cases of Korean courts acknowledging reciprocity between Korea and Kentucky where the Uniform Act is not adopted (Supreme Court Judgment, 28 January 2016, 2015Da207747) but it is not clear whether such could be extended to other states of United States.

12 Supreme Court Judgment, 11 June 2015, 2013Da208388.

13 Supreme Court Judgment, 25 June 2009, 2009Da22952.

14 Supreme Court Judgment, 28 April 1987, 85Daka1767.

15 Article 799 of the Commercial Code.

16 Articles 807 and 808 of the Commercial Code.

17 Article 816 of the Commercial Code.

18 Article 6 of the Ship Act.

19 Supreme Court Judgment, 13 February 2004, 2001DA75318; Supreme Court Judgment, 27 April 2007, 2007DA4943.

20 Articles 815 and 137 of the Commercial Code.

21 Supreme Court Judgment, 10 January 2003, 2000Da70064.

22 Seoul Appellate Court Judgment, 13 June 2008, 2006Na28074.

23 Seoul Appellate Court Judgment, 15 May 1989, 88Na44126.

24 Articles 769 to 776 of the Commercial Code.

25 Article 776 of the Commercial Code.

26 Article 797 of the Commercial Code.

27 PSC Inspection Rate, Statistics Korea.

28 Article 62 of the PILA.

29 Article 40 of the Act on Vessels Entering and Departing Port, Articles 25 to 29 of the Maritime Safety Act.

30 Articles 63 and 65 of the Marine Environment Management Act.