Top Engineering cancels contract with China’s Infintech amid non-payment
Controversy around outstanding payments still ongoing
Two and a half years after Infintech placed orders to South Korean display equipment makers, the Chinese firm is yet to make the payment it promised.
South Korean display equipment firm Top Engineering said on Friday that it has canceled its equipment supply contract with Infintech.
This follows compatriot DMS also canceling its contract with the Chinese firm in December.
Top Engineering said it had signed to contracts with Infintech in 2018, each worth 7.9 billion won and 3.1 billion won for a total of 11 billion won.
The South Korean company said despite the Chinese firm requesting extension of the contract between them, it has failed to go through with the product inspection and payment processes. Therefore, it was canceling the contract.
A Top Engineering spokesperson said the company was unable to reach Infintech.
It will collaborate with other companies that signed similar contracts with the Chinese firm and the Korea Display Industry Association (KDIA) to respond to the situation, the spokesperson said.
The payment it failed to receive has been marked as loss, they added.
Other South Korean companies that signed contracts with Infintech include Vessel and YEST.
Vessel had signed a contract worth 10.5 billion won and YEST 7.7 billion won. DMS had signed a 6.1 billion won contract. They companies say their contracts with the Chinese firm had been extended four to five times since its original deadline of November 2018.
Vessel and YEST are expected to announce the cancellation of their contracts as well as their deadline is May 31.
Infintech is through to owe around 100 billion won in payment to South Korea display equipment makers, people familiar with the matter said.
KDIA is expected to face fierce criticism over the situation. The organization made a formal protest to the Chinese ambassador in South Korea in July last year. However, the organization has so far failed to tract and contact Infintech.
KDIA had been working with regional government of Jiangsu province, where Infintech is based, and Chinese law firm and industry association to contact Infintech, but these efforts have failed to yield results.