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Forced laborers go after assets of Japanese firms

Legal moves will put more strain on ties between Seoul, Tokyo
Jan 03,2019
Victims of forced labor during Japan’s colonial rule recently applied for seizure of assets of Japanese steel giant Nippon Steel & Sumitomo Metal in Korea.

Similarly, a group of forced labor victims who recently won a suit against Japan’s Mitsubishi Heavy Industries is planning to pursue the seizure of its patent rights in Korea, according to their attorney Wednesday.

This follows key Korean Supreme Court rulings last year ordering the Japanese companies to compensate Korean victims of forced labor during World War II, which have been strongly objected to by Tokyo.

After Nippon Steel refused to comply with the court ruling, the group of plaintiffs applied to a local court for a seizure of Nippon Steel’s shares in Korea, according to the legal counsel of the victims and their family members.

Nippon Steel is estimated to have shares valued at 11 billion won ($9.8 million) in PNR, a rotary heat furnace technology joint venture with Korean steelmaker Posco dating back to 2008, also called the Posco-Nippon Steel RHF Joint Venture.

The Supreme Court on Oct. 30 ordered Nippon Steel & Sumitomo Metal to pay 100 million won to each of four Korean victims of forced labor during World War II.

On Nov. 29, the top court made a similar decision ordering Mitsubishi Heavy Industries to pay 100 to 150 million won each to five women and 80 million won each to six victims forced to work at Mitsubishi’s plants and shipyards in Hiroshima.

Japan has expressed “regret” over the Supreme Court decisions, calling on Seoul to take “appropriate measures” to prevent any disadvantages for Japanese companies in Korea.

Even if there is a seizure of Nippon Steel’s stock, it would involve a complicated process of auctioning off the shares. Thus, it could take a considerable amount of time for the victims to see any compensation.

Lee Chun-sik, 94, is the only survivor in the Nippon Steel lawsuit, which dates to 2005. The victims’ legal counsel in November made a visit to Nippon Steel in Tokyo, but was turned away from the headquarters and failed to meet with representatives of the company.

The attorneys set a Dec. 24 deadline, but because Nippon Steel didn’t respond, the victims decided to start legal procedures to seize the company’s Korean assets.

The legal counsel for the Mitsubishi case is giving until March 1 for the company to compensate the victims before it proceeds to file for a seizure of its assets.

“Despite the Supreme Court’s final decision, Mitsubishi does not have any intention to compensate its victims,” an attorney representing the female victims in the Mitsubishi case told the JoongAng Ilbo Wednesday. “While it has removed most of its tangible assets in Korea, we will track down its patents and intangible assets for the compulsory execution [of the court decision.]”

It is estimated that Mitsubishi holds the rights to some 100 patents registered in Korea, though how much they may be worth has yet to be calculated.

The attorney said, “We are in the process of deducing exactly how much of Mitsubishi’s assets remain in Korea along with their patent rights.”

A seizure of the Japanese company’s assets in Korea could further freeze diplomatic relations between the two countries, which are already cool because of historical issues and more recently a defense row.

Japan last month accused a South Korean destroyer of targeting a fire-control radar on one of its patrol planes. Seoul said the warship was merely on a mission to rescue a stranded North Korean fishing boat.

Tokyo claims that a 1965 bilateral treaty normalizing bilateral ties between it and Seoul settled all issues of compensation to victims of colonial rule. The Korean Supreme Court ruled that the Japanese government failed to acknowledge the illegality of its colonial rule and that the victims’ rights to individual compensation have not expired.

BY SARAH KIM, LEE HOO-YEON [kim.sarah@joongang.co.kr]