Japan, Korea forced labour dispute deepens amid asset freeze

Japan to discuss response after South Korean court freezes local assets of Nippon Steel & Sumitomo Metal Corporation.

    Lee Choon-shik, a victim of wartime slavery, arrives for a court hearing in October as supporters hold portraits of forced labour victims and banners urging Nippon to apologise and pay compensation [File: Kim Hong-Ji/Reuters]
    Lee Choon-shik, a victim of wartime slavery, arrives for a court hearing in October as supporters hold portraits of forced labour victims and banners urging Nippon to apologise and pay compensation [File: Kim Hong-Ji/Reuters]

    Japan says it will seek talks with South Korea following a court decision's to seize the Korean assets of a Japanese company that has been ordered to pay compensation to victims of wartime slavery.

    The Daegu District Court in the South Korean city of Pohang on Wednesday said it had approved a request to freeze the assets of Nippon Steel & Sumitomo Metal Corporation because the company was refusing to comply with a landmark ruling to compensate the former labourers.

    In Tokyo, Chief Cabinet Secretary Yoshihide Suga told reporters that Japan's government took the court decision seriously and that ministers would meet on Wednesday afternoon to discuss how to respond.

    Last year, South Korea's top court ordered Nippon Steel to pay 100 million won ($88,000) each to four plaintiffs who had been forced to work for the company during the Japanese colonisation of the Korean Peninsula between 1910 and 1945.

    Japan maintains all colonial-era compensation issues were settled by a 1965 treaty between the two countries, and the court decision could further chill diplomatic ties. Many South Koreans still harbour strong resentment against Japan for the abuses suffered during the occupation and World War II.

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    The Japanese company holds 2.34 million shares, a stake valued at around $9.7m, in its joint venture with South Korean steelmaker POSCO.

    South Korea's Yonhap news agency, citing an unidentified official at the Pohang office, reported the district court decided to freeze 81,075 of the 2.34 million shares, rather than the entire stake.

    Yonhap said the asset freeze would take effect once a related court document had been delivered to the joint venture.

    The Associated Press news agency said the district court could not immediately confirm the Yonhap report.

    In November, South Korea's Supreme Court ordered a second Japanese company, Mitsubishi Heavy Industries, to compensate 10 former Korean workers, drawing a strong rebuke from Japan.

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    SOURCE: News agencies