Warehouse receipts at centre of Qingdao row on first day in court

The legal dispute between Citic Resources and Qingdao Port over a cargo of base metals involved in a fraud investigation centres on warehouse receipts that the port denies issuing, legal representatives of the firms at the first hearing of the case in Qingdao Maritime Court, said yesterday.

Banks suspect the same cargoes of aluminium and copper were pledged multiple times as collateral for loans, and the investigation has prompted banks, warehouses and trading firms worldwide to launch lawsuits to protect their rights to the metals.

A representative of the plaintiff, Citic Australia Commodity Trading, a subsidiary of Hong Kong-listed Citic Resources, told the South China Morning Post yesterday that it held receipts from Qingdao Port, but the port refused to release the metals.

Shanxi Coal International, another mainland company embroiled in the case, which has taken legal action against a number of companies, including Citic Australia Commodity Trading, also had representatives at yesterday's hearing. One representative said the dispute yesterday centred on whether "warehouse receipts" bearing the name of Qingdao Port were valid or fake.

A legal representative of the defendant, Qingdao Port, said the port denied issuing any of the "warehouse receipts" presented by Citic.

He said the hearing did not reach any conclusion and there might be a further hearing, while the "warehouse receipts" had been transferred to the police for verification.