President Lee Jae-myung’s remarks, followed by signals of support from major shareholder Korea Development Bank, have pushed a possible relocation of HMM’s headquarters to Busan back into focus. Industry watchers say the company could replace three outside directors whose terms expire next month and then call an extraordinary shareholders meeting to amend its articles of incorporation, a required step for a headquarters move. A key variable is opposition from the union, which has signaled it is willing to strike.
According to the industry on Wednesday, KDB Chairman Park Sang-jin said at a media briefing the previous day that the Ministry of Oceans and Fisheries and the Korea Ocean Business Corp. had presented a schedule to complete HMM’s move to Busan in March and April. “If the relocation is confirmed, we will actively support it,” Park said.
The comments effectively formalized the relocation push in line with Lee’s presidential campaign pledge. KDB and the Korea Ocean Business Corp. are HMM’s No. 1 and No. 2 shareholders, holding 35.42% and 35.08%, respectively.
The biggest obstacle is HMM’s articles of incorporation, which stipulate that the headquarters is in Seoul. The company must amend the articles at a shareholders meeting before it can begin practical work for a move.
Amending the articles requires a special resolution backed by at least two-thirds of shareholders present. With KDB, the Korea Ocean Business Corp. and the National Pension Service holding more than 70% of HMM shares, the government could change the articles and relocate the headquarters if the item is put to a vote.
Investment banking sources said the agenda for HMM’s regular shareholders meeting scheduled for March 26 is not expected to include an articles amendment. No related item was included in shareholder proposals that closed earlier this month.
In the shipping industry, a widely discussed scenario is that KDB and the Korea Ocean Business Corp. replace the three outside directors at the regular meeting, convene a board meeting in April to approve an articles amendment proposal, and then change the articles at an extraordinary shareholders meeting in May. Practical work for a Busan relocation is expected to ramp up in the second half of this year.
HMM’s onshore union, which represents employees working in Seoul, is strongly opposed. It is expected to begin rallies next week in the Yeouido area and to hold a strike resolution rally in front of Cheong Wa Dae to block the move, according to reports.
Under current labor law, management decisions such as relocating a headquarters generally are not eligible targets for industrial action. But when the revised Trade Union and Labor Relations Adjustment Act, known as the Yellow Envelope law, takes effect next month, unions may have another route: if a management decision is interpreted as having a substantial impact on working conditions, it could be treated as a legitimate subject of a labor dispute. If an HMM strike materializes, it would draw attention across business, labor and legal circles as a potential first major-company general strike after the law takes effect.
Separately, the Ministry of Oceans and Fisheries, the Korea Shipowners’ Association and the city of Busan surveyed association members ahead of forming a relocation support council for shipping companies. About 90% of respondents were said to have expressed a negative view of moving to Busan. An industry official said companies judged the advantages of a Seoul headquarters — including communication with cargo owners and securing talent — to outweigh incentives offered by the government and local authorities, adding that additional support measures by the government and the ruling party appear necessary.
* This article has been translated by AI.
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