Japanese Foreign Minister Taro Kono speaks to media after a meeting with South Korean ambassador to Japan Lee Su-hoon (not pictured) at the Foreign Ministry in Tokyo, Japan October 30, 2018.  REUTERS/Issei Kato
© Reuters

South Korea’s supreme court has ordered a Japanese steelmaker to compensate the victims of forced labour during Japan’s wartime control of the Korean peninsula, drawing a line under the decades-old case but threatening to jeopardise ties between the Asian neighbours. 

Tuesday’s court decision, which followed years of judicial wrangling and political intrigue, triggered an immediate riposte from Japan’s foreign minister Taro Kono, who called the verdict “completely unacceptable” and demanded immediate action from Seoul “to correct its violation of international law”.

The ruling is the latest bump in relations between Japan and South Korea, which — despite their shared democratic credentials — are regularly embroiled in spats stemming from Tokyo’s colonial-era control of Korea.

The decision comes as Seoul considers whether to return $9m that Tokyo donated to the victims of wartime sexual slavery— a move that could portend another round of acrimony over the “comfort women” issue.

In its ruling, the top court in Seoul dismissed a final appeal by Nippon Steel & Sumitomo Metal and ordered the world’s third largest steel producer to pay $90,000 to each of the four forced labour victims, only one of whom is still alive.

The roots of the case date back to 1997 when two of the claimants made a bid for compensation in a court in Osaka.

The Japanese court, however, dismissed the action, saying Nippon Steel & Sumitomo Metal — a merged entity — could not be held liable for offences committed at the group’s forebear Japan Iron & Steel.

The case was then brought to South Korea, where the supreme court in 2012 ordered the Japanese company to pay compensation, noting that the Osaka court ruling was conducted on the disputable premise that Japan’s colonial control of Korea was legal.

Crucially, the court also ruled that a 1965 bilateral agreement between Seoul and Tokyo to settle compensation for wartime atrocities did not prevent individuals from suing for damages — a judgment that Tokyo does not accept.

The ruling on Tuesday marked the final appeal by the Japanese company, in a process that was delayed many times over the years.

“The supreme court’s decision is deeply regrettable, as it is contrary to the agreement . . . signed on June 22, 1965,” said Nippon Steel & Sumitomo Metal in a statement.

“The Korean supreme court’s decision is also inconsistent with the judgment of the Japanese judiciary system, although both are based on the same set of facts.”

Mr Kono said the decision threatened to overturn the legal basis for friendly relations between Japan and South Korea. Should Seoul not change course on the issue, Tokyo will consider all options, including taking the case to an international court, Mr Kono added.

The bitter rhetoric sets the stage for a potential dispute between the two nations about the future of the “comfort women” funds and the foundation set up to assist the surviving victims. Many in Seoul expect the foundation to be disbanded.

Other cases of wartime forced labour, including one involving Mitsubishi Heavy Industries, remain pending in South Korea’s courts.

Additional reporting by Kang Buseong

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