Korea Shipowners' Association(KSA) has recently sent an official document to 5 power companies under the control of Korea Electric Power Corporation(KEPCO) that Japan-affiliated shipping lines should be excluded in a bidding for transporting imported coal on the ground that Japanese power companies have always blocked participation of domestic shipping companies in their bidding.

KSA demanded in a document "5 national power companies have continuously allowed NYK Bulkship Korea to join in the bidding since its first contract of long term traffic right for the imported coal in 2004. This is very frustrating to our shipping industry, so we strongly demand that long term transportation contract afterwards should be made with national shipping lines."

Under continuous depression in the shipping market, NYK Bulkship Korea's participation in a bidding on an equal footing with domestics shipping companies has triggered a huge backlash from shipping industry.

According to KSA, 3 major Japanese shipping lines of NYK, K-Line and MOL strategically established NYK Bulkship Korea to join in a bidding and actually made a contract for 18 vessels.

As a result, power companies under KEPCO handed over total 195 million tons(yearly 16.5 million tons), which is 25% of total import volume, to Japan's 3 major shipping lines and NYK Bulkship Korea. KSA alleges that 2 trillion and 65 billion Won(yearly 240 billion Won) of the wealth of the nation has leaked out to Japan over the contract period and it causes annual loss of 540 jobs for the crew.

Power companies reluctantly discontinued international bidding in 2009 as the National Assembly unanimously passed a resolution for transportation of bulk handling by national shipping lines, however, NYK Bulkship Korea has been allowed to join in the bidding due to the fact that it is registered as a national shipping line.

KSA complained "Even the government is now giving full support to shipping companies that are in a liquidity crisis owing to world-wide recession. Far from providing assistance, the power companies are frustrating shipping industry by letting NYK Bulkship Korea into the bidding."

Korea East-West Power Company(EWP), one of the 5 subsidiaries of KEPCO, brought about strong defiance from the shipping industry by concluding a contract with NYK Bulkship Korea in February for 2 vessels(200,000 ton class 1 unit plus 90,000 ton class 1 unit) to import coal for power generation. It is known to be a 300 million dollar contract for 20 years' term.

KSA asserts that even now power companies have to develop partnerships with domestic shipping companies and find a win-win solution. KSA says they will take measures against unjustness of power companies such as adverts in the media unless there are no proper follow-up action from the power companies.

Meantime, Mr. Ju Sung Ho, a vice prime minister of MLTM(The Ministry of Land, Transport and Maritime Affairs), said as follows at KMI(Korea Maritime Institute)'s 'Marine Policy Forum' which was held on 4th Apr. "Regarding EWP's a long term contract for coal traffic right with Japan-affiliated shipping line, we will try to provide an institutional strategy through inter-ministerial discussion enabling national shipping lines to transport bulk handling."

Further, he apologized that such cases have repeatedly occurred and said the government would make a breakthrough centering around Korea Shipowners' Association.