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Published on 4/08/2020 11:10:47 AM | Source: Reuters

Nippon Steel to appeal South Korea ruling allowing seizure of assets

Posted in Top Stories| #World Market #South Korea

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TOKYO - Japan's Nippon Steel Corp said on Tuesday it will appeal a South Korean court ruling that allows for a seizure of its assets - the latest development in a case that has inflamed tensions between Tokyo and Seoul.

South Korea's Supreme Court in 2018 ordered Nippon Steel to pay 100 million won ($83,800) each to four South Koreans as compensation for forced labor during World War II, angering Japan which says the issue of compensation was settled under a 1965 treaty and that the ruling violated international law.

A subsequent ruling by a South Korean lower court allowed for the seizure of Nippon Steel assets. Starting midnight Tuesday, the Pohang branch of the Daegu District Court has gained the right to start procedures to auction off some of Nippon Steel's stake in a joint venture with POSCO, South Korean media have reported.

Japanese Chief Cabinet Secretary Yoshihide Suga reiterated on Tuesday that the South Korean ruling was a "clear violation of international law", adding that any asset seizure must be prevented to keep the situation from becoming more serious.

Following the ruling, Japan last year said it would stop preferential treatment for shipments to South Korea of three materials whose production it dominates and which are used by firms such as Samsung Electronics Co Ltd.

Seoul has filed a complaint to the World Trade Organization over the export curbs which remain in place for two of the three materials. The WTO last month set up a panel to rule on the complaint.

Nippon Steel holds 81,075 shares in PNR, a Korea-based joint venture with steelmaker POSCO, which are worth about 400 million won at face value, according to Yonhap news agency.

($1 = 1,192.8600 won)

(Reporting by Yuka Obayashi and Rocky Swift in Tokyo; Editing by Edwina Gibbs)