China Ocean Group loses arbitration battle against financial services firm

China Ocean Group's distant-water fishing fleet
China Ocean Group's distant-water fishing fleet | Photo courtesy of China Ocean Group
4 Min

An arbitration court in Hong Kong has decided against China Ocean Group Development Co. in its dispute with COFCO Capital (Hong Kong) Co. over an alleged breach of a bond-subscription agreement.

COFCO initiated arbitration proceedings with the Hong Kong International Arbitration Centre (HKIAC) against China Ocean Group, as well as company executives Liu Rongsheng and Liu Yi, in 2021. COFCO, a state-owned company, had purchased bonds that later converted into shares in China Ocean, which operates a fleet of distant-water fishing vessels. As of 21 April 2022, COFCO held a 4.7 percent stake in China Ocean.

The court, which took three years to reach a judgement, ruled China Ocean breached the subscription agreement under which the bonds were issued to COFCO.

Under the terms of the court’s ruling, during the period COFCO continues to hold shares of the company, China Ocean is not allowed to issue any bonds or conduct financing activities on terms that are better than the subscription agreement between COFCO and China Ocean.

China Ocean is also prohibited from issuing convertible bonds, shares, or options at a price lower than the HKD 0.24 (USD 0.031, EUR 0.028) per share rate at which COFCO converted its bonds to shares. Additionally, the court ordered China Ocean to pay COFCO HKD 5 million (USD 650,000, EUR 600,000) to cover legal and other fees it incurred through the arbitration process.

In a statement to investors, China Ocean said its board is “of the preliminary view” the court decision “has ...

SeafoodSource Premium

Become a Premium member to unlock the rest of this article.

Continue reading ›

Already a member? Log in ›


Want seafood news sent to your inbox?

You may unsubscribe from our mailing list at any time. Diversified Communications | 121 Free Street, Portland, ME 04101 | +1 207-842-5500
Secondary Featured Article