China targets five U.S. subsidiaries of South Korea’s Hanwha Ocean, sending shares down 8%

China on Tuesday added five U.S. subsidiaries of South Korean shipbuilder Hanwha Ocean to its sanction list over their alleged involvement in Washington’s probe into the Chinese shipping industry, escalating tensions between Beijing and Washington.

The sanctioned subsidiaries include Hanwha Shipping LLC, Hanwha Philly Shipyard Inc., Hanwha Ocean USA International LLC, Hanwha Shipping Holdings LLC, and HS USA Holdings Corp, according to a statement from China’s Commerce Ministry.

The order, which took effect immediately, will prohibit Chinese organizations and individuals from doing business with the sanctioned companies, the statement said.

The move followed the U.S. decision to impose steep fees on Chinese ships docking at American ports starting Tuesday at 12:01 a.m. EDT.

China retaliated with a similar charge of 400 yuan ($56) on American vessels, starting on the same day.

Beijing has also unveiled a new framework for restricting rare earths exports and expanded its blacklist of U.S. companies.

In response, U.S. President Donald Trump threatened to impose 100% more tariffs on Chinese imports, prompting Beijing to assert its rare earths restrictions as a “legitimate” measure.

Shares of Hanwha Ocean in Seoul plunged over 8% following the announcement.

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