The Japanese government plans to take countermeasures if South Korea converts a Japanese company's assets into cash to provide compensation for former requisitioned workers from the Korean Peninsula, according to Chief Cabinet Secretary Yoshihide Suga.
"To protect the legitimate economic activities of Japanese companies, we want to respond resolutely with all options in mind," Suga said at a Tuesday press conference following the implementation of a court procedure in South Korea that allows seized assets to be converted into cash.
The court procedure "is a clear violation of international law. Converting the assets to cash could result in a serious situation [for Japan-South Korea relation] and thus must be avoided," Suga said.
Known as "service by publication," the court procedure took effect at midnight Monday. Under the procedure, a document announcing the court decision to seize some of the assets of Nippon Steel Corp. is deemed by a South Korean court to have been delivered to the Japanese steel maker.
Deputy Prime Minister and Finance Minister Taro Aso said at a press conference on Tuesday, "We may have no choice but to take appropriate action." The government is considering the possibility of raising tariffs and suspending remittances to South Korea.
Nippon Steel Corp. said Tuesday that it will file an immediate appeal after the service by publication took effect. Executive Vice President Katsuhiro Miyamoto said at a press conference. "It is understood that the issue was completely and finally resolved through the Agreement on the Settlement of Problems concerning Property and Claims and on Economic Cooperation between Japan and South Korea, which is a formal agreement between the two countries."
"Taking into account the diplomatic negotiations between the Japanese and South Korean governments, we will collaborate with the government and respond appropriately," Miyamoto said.
Even if Nippon Steel files an immediate appeal, the seizure can be completed if a South Korean court rejects the appeal, and an order to sell the assets could be issued within a few months at the earliest.
Some believe there is still time before actual losses are imposed on Nippon Steel because procedures to auction the assets will take time.
-- 'Compromise needed'
SEOUL -- A spokesman for the South Korean Foreign Ministry on Tuesday stressed the need for dialogue and indicated that a compromise by Japan is indispensable to break the deadlock.
"We will continue our efforts to resolve the issue through diplomatic channels. We hope the Japanese government will [participate in dialogue] in a more proactive and sincere manner," the spokesman said at a regular press conference.
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