Despite Efforts to Improve Korea-Japan Relations... Tensions Rise Over Dokdo and the Line

Japan's Pressure on 'Line' Met with Korea's "Discriminatory Measures"
From Dokdo and Yasukuni to Economic Issues
Korea's Diplomatic Stance Makes Active Response Difficult

President Yoon Suk-yeol is shaking hands with Japanese Prime Minister Fumio Kishida and taking a commemorative photo at the Korea-Japan summit held at a hotel in San Francisco on November 16 last year (local time).
[Image source=Yonhap News]

Despite the South Korean government's continuous efforts to improve Korea-Japan relations, tensions between the two countries are escalating as Japan persists with its territorial claims over Dokdo, collective visits to the Yasukuni Shrine, and pressure on Korean companies to sell their shares.

In particular, the Japanese government's pressure on 'LINE,' the popular Japanese messenger service developed by Naver, is widely perceived within the South Korean government as an unreasonable demand, raising concerns that this issue could escalate into a diplomatic conflict.

According to the Ministry of Foreign Affairs on the 29th, the South Korean government recently reached a consensus that Japan's request for Naver to sell shares of A Holdings, the holding company of Line Yahoo, constitutes a 'discriminatory measure,' and decided to communicate with both Naver and Japanese parties.

Line Yahoo is a company that operates 'LINE,' developed by Naver's Japanese subsidiary NHN Japan, and 'Yahoo,' the largest portal site operated by SoftBank. A Holdings, a joint venture equally owned by Naver and SoftBank, holds 64.5% of the shares.

After a massive leak of Line Yahoo customer information due to a Naver Cloud hacking incident in November last year, SoftBank moved to take control of LINE's management by acquiring shares of A Holdings. With the Japanese government's support, the issue has evolved from a corporate matter into a diplomatic concern.

Although the Japanese government's pressure to sell shares lacks legal binding force, Naver is not obligated to comply. However, if the Japanese government and political circles intensify pressure due to their resentment over a Korean company controlling Japan's leading messenger platform, it is analyzed that Naver alone may find it difficult to handle the situation.

Professor Kwon Nam-hoon of Konkuk University's Department of Economics stated, "If it is considered a national security issue, like the U.S. pushing for the forced sale of TikTok, the government can intervene, but such a scenario only arises in U.S.-China relations, not in Korea-Japan relations. It is unusual."

The government is expected to respond at the level of the Ministry of Foreign Affairs, Ministry of Science and ICT, and Ministry of Trade, Industry and Energy after confirming Naver's intention regarding the share sale. However, since the Yoon Seok-yeol administration maintains a policy of improving Korea-Japan relations, the scope of action is likely to be limited.

Some argue that despite the improving atmosphere in Korea-Japan relations, the Japanese government and political circles are causing conflicts by approving textbooks that assert territorial claims over Dokdo and conducting collective visits to the Yasukuni Shrine, where Class-A war criminals from the Pacific War are enshrined.

Professor Kwon explained, "Regarding the pressure to sell LINE shares, the government should respond by effectively persuading that there are no security issues with LINE. I do not think the sale will materialize immediately."

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