No Response Card Under International Law for Japan, Is Diplomatic Retaliation Imminent?

Japanese Government Claims 'Formation of Arbitration Committee and Filing with International Court of Justice'
Impossible Without Consent of Parties... No Legal Card to Play Under International Law
Possibility of Diplomatic Conflict Such as Retaliation Against Private Companies Like Last Year

Students from the Korean University Students Progressive Union are urging an apology and compensation for forced labor and the withdrawal from South Korea at a press conference held last August in front of Mitsubishi Corporation in Jung-gu, Seoul. [Image source=Yonhap News]

[Asia Economy reporters Seongpil Jo and Donghoon Jung] Even if the Korean courts proceed with the cash seizure process of the Japanese forced labor company Nippon Steel (formerly Shin Nihon Steel), the Japanese government has few cards to play under international law. Because of this, there are concerns that diplomatic retaliation stronger than the export restrictions Japan enforced last year will follow.

According to international law experts and the legal community on the 30th, the methods Japan can use under international law include forming an arbitration committee and filing a case with the International Court of Justice, but these are impossible without the consent of the parties involved. Currently, the Korean government is rejecting Japan’s claims for forming an arbitration committee, stating that "the individual claims did not expire under the 1965 Korea-Japan Claims Agreement."

Until now, the interpretations of the Korea-Japan Claims Agreement by the two governments have been completely different. Japan maintains the view that the forced labor compensation issue was resolved by the 1965 Korea-Japan Claims Agreement and that the Supreme Court’s compensation ruling violates international law. Japan has argued for the formation of an arbitration committee based on Article 3 of the Korea-Japan Claims Agreement, which states that "disputes between the two countries regarding the interpretation of the agreement should be resolved through diplomatic channels," and "if the issue is not resolved through bilateral consultations, an arbitration committee involving Korea, Japan, and a third country may be formed." The arbitration committee is composed of arbitrators of a third nationality selected by each party to form an arbitral tribunal. This procedure has been used in international disputes such as the North Sea Continental Shelf cases between the Netherlands and West Germany, and the Norwegian Fisheries Dispute between the UK and Norway. However, tripartite arbitration requires the consent of the parties involved, which the Korean government has not given. The same applies to filing a case with the International Court of Justice; it is difficult without mutual consent between the two countries.

Since Japan’s international legal responses are practically impossible, the prevailing view is that Japan will resort to additional diplomatic retaliation. In this case, there are concerns that it will become even more difficult to untangle the already complicated Korea-Japan relationship. Oh Hyun-seok, Ph.D. in international law and head of the Promotion Strategy Division at the Korean Commercial Arbitration Board, said, "In a situation where Japan has no cards to play, this dispute is likely to escalate into a diplomatic issue." In fact, Japan imposed export restrictions on Korea last July, targeting three key semiconductor and display materials, as retaliation for the Supreme Court’s forced labor compensation ruling. If the cash seizure process of Nippon Steel’s assets intensifies, stronger diplomatic retaliation may follow. The Korean government also resumed the World Trade Organization (WTO) complaint procedure on the 2nd of last month, which had been postponed. It is also known to be considering terminating the Korea-Japan General Security of Military Information Agreement (GSOMIA), which had been suspended since last November.

International law experts emphasize not only enforcing the Supreme Court’s ruling but also the tripartite arbitration procedure and diplomatic solutions. Lawyer Song Ki-ho (former chair of the International Trade Committee of the Korean Bar Association) said, "What the Supreme Court ruling and the Constitutional Court require from our government is to actively exercise diplomatic protection rights for the 70,000 forced labor victims and to resolve the issue through diplomatic channels with Japan. When it cannot be resolved through diplomatic channels, the Supreme Court and Constitutional Court require referring the matter to arbitration."

This content was produced with the assistance of AI translation services.