Seizure of Nippon Steel Assets Requested over Wartime Labor

January 2, 2019

Seoul--South Korean plaintiffs in a wartime labor lawsuit have filed with a local court for the seizure of Nippon Steel & Sumitomo Metal Corp. <5401> assets in the country, the plaintiff side announced on Wednesday.

The move came after South Korea's Supreme Court on Oct. 30 upheld a lower court's ruling ordering the Japanese company to pay 100 million won, or nearly 90,000 dollars, in compensation for each of the four plaintiffs who claimed to have been brought to Japan during World War II to work for Nippon Steel's predecessor. The Korean Peninsula was under Japanese colonial rule at the time.

On Dec. 24, a lawyer for the plaintiffs revealed a plan to start procedures shortly for seizing Nippon Steel assets, claiming that the company failed to meet a deadline for showing an intention to hold talks with the plaintiff side on the compensation issue.

On Wednesday, the plaintiff side condemned Nippon Steel for showing no sincerity toward implementing the ruling, while criticizing the Japanese government for putting pressure on the company not to follow the ruling.

Subject to the asset seizure request are about 2.34 million shares owned by Nippon Steel in a recycling company jointly set up with major South Korean steelmaker Posco. The shares are estimated to be worth around 11 billion won.

The Japanese government takes the position that the wartime labor issue was resolved under a 1965 bilateral agreement with South Korea. In response to the South Korean top court ruling, Tokyo is urging Seoul to take corrective action promptly.

The Japanese government has signaled its readiness to take a countermeasure against the enforcement of the ruling, which could further worsen Japan-South Korea ties.

After the plaintiffs announced the start of the asset seizure procedures, an official of Nippon Steel suggested that the company will not comment on the latest move. The company has consistently taken the position that it will leave the settlement of the issue to intergovernmental discussions between Japan and South Korea. Jiji Press