The move comes as London arbitration hearings are set to begin next month in the dispute.

The decision by District Judge Phyllis Hamilton, of the federal court in Oakland, follows an agreement between the warring parties to liberate the funds.

However, $25m will remain held in the court, where Pan Ocean has been pursuing a $29m lawsuit over a charter dispute.

When it filed the case in 2013, Pan Ocean complained that Korean tax authorities garnished charter payments that it was paying to Cido for eight vessels because Cido had allegedly defaulted on tax payments.

Cido