Seoul Court Rejects DM Shipping’s Compensation Claim Against Government for 2021 Tanker Seizure in Iran

SEOUL – In a significant legal development, a Seoul appellate court has dismissed a compensation claim by DM Shipping, the operator of a South Korean chemical tanker detained in Iran in 2021. The Seoul High Court's decision upholds a previous lower court ruling in this high-profile case.

According to Yonhap News Agency, the dispute originated when the Hankuk Chemi, a South Korean-flagged vessel operated by DM Shipping, along with its 20 crew members, was seized by Iran's military near the Strait of Hormuz in January 2021. Although 19 sailors were released within a month, the ship and its captain were held for 95 days. The seizure, officially attributed by Iran to marine pollution, was broadly interpreted as a response to Seoul's perceived inaction in releasing approximately US$7 billion in Iranian assets frozen in South Korean banks due to U.S. sanctions.

DM Shipping subsequently filed a lawsuit against the South Korean government, demanding 1.45 billion won (US$1.08 million) in compensation. The company argued that the government had failed to fulfill its duty to safeguard its nationals, alleging inadequate warning about the risk of capture and insufficient efforts to negotiate their release.

However, the Seoul High Court, agreeing with the lower court's verdict, found that the government had not neglected its responsibilities. The judgment highlighted the government's regular communication with Korean ships near the Strait of Hormuz since January 2020 for safety purposes. Furthermore, the court noted the government's extensive diplomatic efforts to secure the ship's release and its financial assistance to DM Shipping during its management crisis.

This ruling marks a closure to the legal battle surrounding the Hankuk Chemi incident, underscoring the complexities of international maritime operations and diplomatic negotiations.

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