In 2024, the Korea Coast Guard relaunched the Turtle Ship Fund to raise private capital for the vessel construction.

Since the partial amendment of the Ship Investment Company Act in June 2005, the public has been able to invest in shipbuilding projects for the Korea Coast Guard. Capitalizing on this change, the Korea Coast Guard established the Turtle Ship Fund No. 1 through No. 7 between 2006 and 2010, raising KRW 980 billion to build 34 medium- and large-sized vessels.

The Korea Coast Guard aims to replace aging ships using funds raised through the newly reestablished Turtle Ship Fund. This initiative seeks to enhance the police’s on-site response capabilities and alleviate the government’s financial burden by distributing a significant portion of the national budget. Over the ten-year period from 2024 to 2033, it plans to replace ten aging 200-tonne small vessels.

We are providing legal advice on matters related to the Turtle Ship Fund project involving a deferred payment sales agreement for ten 200-tonne petrol vessels—including the structuring of the shipbuilding contracts and ship finance loan agreements, and collateral arrangements for the ship investment company and ship finance company.

It is critically important to provide legal assistance to ship finance companies or ship investment companies to ensure that shipbuilding and financing procedures are conducted safely and in compliance with the law. In particular, the interpretation of ship finance agreements can vary significantly depending on the specific wording used, making close collaboration with a competent law firm essential for the secure execution of the project.

We are currently advising on a variety of ship finance projects, including the Turtle Ship Fund, thereby expanding both our expertise and scope in the field of ship finance.