S Korea to file WTO complaint over Japan's export curbs

September 11, 2019 11:51
South Korean firms are 'faced with serious damage' as a result of Japan's export curbs, Trade Minister Yoo Myung-Hee said on Wednesday. File photo: Bloomberg

South Korea plans to file a complaint at the World Trade Organization (WTO) over Japan’s tighter export controls, accusing Tokyo of being “politically motivated” and “discriminatory” in its policy moves, Reuters reports.

"We have decided to complain about Japan’s measures at the WTO... to prevent the act of abusing trade for political purposes from recurring,” South Korea’s Trade Minister Yoo Myung-Hee was quoted as saying at a briefing on Wednesday.

The move comes after Japan imposed in July tighter controls on exports of three materials to South Korea used in smartphone chips and displays following a diplomatic dispute over compensation for forced laborers during Japan’s occupation of Korea during World War Two.

Yoo said South Korean firms are “faced with serious damage” as a result of the export curbs, which also cast uncertainty into the global supply chain and the economy.

The materials affected by Japan’s export controls are fluorinated polyimides, photoresists and hydrogen fluoride, which are used by South Korean tech firms such as Samsung Electronics.

Japan now requires exporters to seek permission each time they want to ship those materials, which takes up to 90 days. Previously, it only took a couple of weeks to ship, Yoo said.

Only three shipments have been approved since Tokyo took action on July 4, according to the report.

As the first step of WTO dispute settlement, South Korea will request consultations with Japan and seek the end of the export curbs.

If that does not resolve the issues, South Korea will request a WTO panel ruling on the cases, the Korean trade minister said.

The talks could take 60 days or more, a trade ministry official said.

Yoo also said South Korea is considering “all options” in response to Tokyo’s decision to drop Korea from the so-called white list of preferred trading partners.

Seoul is taking steps to drop Japan from its own white list.

Bilateral relations deteriorated after South Korea’s Supreme Court last year ordered two Japanese companies to compensate wartime workers in a ruling that Tokyo said violated international law.

Japan says the issue of compensation was settled under a 1965 treaty.

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