S Korea calls for WTO arbitration in trade conflict with Japan

SOUTH Korea’s Trade Ministry plans to reopen a World Trade Organization (WTO) complaint procedure over Japan’s tightened controls on trade as progress on the issue has stalled, it said in a statement on Tuesday. The ministry said Tokyo lacked commitment to resolve the dispute. Seoul is to ask the WTO to set up an arbitration panel as a May deadline for progress has passed.

Japanese Foreign Minister Toshimitsu Motegi expressed regret over Seoul’s move.

“It was regrettable that the announcement was made unilaterally by South Korea,” Motegi told reporters in Tokyo.

The countries have been locked in a feud since last July over Tokyo’s tougher export controls on materials used by its neighbour to manufacture computer chips and displays.

While South Korea is the world’s largest producer of computer chips, it imports raw materials needed in the process from Japan.

The dispute led the two countries to downgrade each other’s trade status before Seoul threatened to end a military information sharing pact with Japan.

But South Korea decided to maintain the pact amid growing pressure from US President Donald Trump’s administration.

South Korea’s initial complaint was also put on hold in November after both sides had agreed to hold working talks.

The background to the dispute is a 2018 ruling by South Korea’s Supreme Court, which ordered two Japanese companies to compensate South Koreans over forced labour during Japan’s 1910-45 occupation of the Korean Peninsula.

Japan considers the matter closed as it was covered in a bilateral treaty signed in 1965. However, South Korea argues it cannot intervene in civil litigation and that it honours that court decision. Seoul asserts that Japan’s export curbs are a retaliation for the Supreme Court’s decision.

The WTO arbitration process could take up to a year, depending on the progress made.