South Korean Top Court Upholds Compensation for Wartime Forced Labor by Japanese Firms
The Supreme Court of the Republic of Korea (South Korea) has upheld a 2013 ruling that found that Nippon Steel and Sumitomo Metal Corporation — a Japanese steelmaker — should compensate four South Koreans drafted into forced labor, under the Japanese colonial administration of the Korean Peninsula, in the early 1940s. The Supreme Court also ruled that each of the four plaintiffs must be paid 100 million won (87,720 USD) as compensation.
The ruling by South Korea’s top court ends the nearly 20-year legal drama surrounding the lawsuit. First filed in Japan by two former workers of Nippon Steel and Sumitomo Metal in 1997, Japanese courts declined to rule in favor of the workers on the grounds that the 1965 treaty normalizing relations between Tokyo and Seoul had already settled the issue. In 2005, joined by two other former workers, the plaintiffs took their case to the South Korean judicial system.
While South Korean courts initially agreed with rulings produced in Japan, the South Korean Supreme Court remanded the case back to lower courts in 2012 on the reasoning that the Japanese rulings contradicted international legal norms and the Constitution of the Republic of Korea. As such, in 2013, two separate lower courts ruled that Nippon Steel must compensate two groups of plaintiffs, with damages ranging from 71,800 USD to 89,900 USD. Additional rulings in 2014 by South Korean courts ordered Mitsubishi Heavy Industries and Nachi-Fujikoshi Corporation to compensate surviving workers and the families of nearly two dozen others who had already died.
All three Japanese companies involved in the series of forced labor compensation cases appealed. Ultimately, the Supreme Court upheld the ruling against Nippon Steel after nearly five years of deliberation; however, only one out of the four plaintiffs, Lee Chun-sik, remained alive to witness Oct. 30’s verdict. Legal experts expect the top court to rule similarly regarding the other two Japanese firms.
In its ruling, the Supreme Court definitively rejected Nippon Steel’s claim that the issue of wartime compensation was settled by the 1965 Treaty on Basic Relations between Japan and the Republic of Korea. Signed on June 22, 1965, the treaty established basic diplomatic relations between Tokyo and Seoul and nullified all colonial-era treaties — including the annexation of Korea by Japan — between the Empire of Japan and Empire of Korea signed on or before August 22, 1910.
Under the 1965 treaty and negotiations related to the treaty, Tokyo provided 500 million USD worth of economic assistance to then-impoverished South Korea — a monetary amount that successive Japanese governments have maintained was paid as reparation by Japan to South Korea to “permanently settle all wartime compensation issues.” However, the Supreme Court’s Oct. 30 finds that no international law, the 1965 treaty, or any postwar bilateral agreement could terminate the rights of individuals seeking consolation money for the “inhumane illegal” experiences during the colonial and wartime era.
Nippon Steel and Sumitomo Metal Corp. is not the only company facing a wartime labor lawsuit. About 70 Japanese companies, such as Mitsubishi Heavy Industries, Yokohama Rubber, Sumiseki Holdings, and Hitachi Zosen, are involved in 15 similar cases. By ruling for compensation from Nippon Steel, the Supreme Court has set a precedent for individual reparation lawsuits which would likely be followed in the 15 related pending cases. Furthermore, the ruling could encourage families of forced laborers to file lawsuits against approximately 300 Japanese companies accused of using forced labor during Japanese colonial rule on the Korean Peninsula.
Tokyo immediately slammed the South Korean top court’s ruling on Oct. 30, with a visibly angry Taro Kono, Japanese Foreign Minister, declaring the ruling “very regrettable and totally unacceptable” and warning that the ruling “fundamentally undermines the legal basis that has served as the foundation of the friendly relationship” between Seoul and Tokyo since 1965.
Japanese Prime Minister Shinzo Abe told a National Diet committee on Nov. 1 that the ruling was “an inconceivable decision in light of international law” and stated that the government “will respond resolutely while examining all options,” including international arbitration and possibly institution of proceedings at the International Court of Justice. Members of his ruling party, in a separate meeting on Nov. 1, formally called for Abe to propose arbitration with Seoul based on the terms of the 1965 treaty while the four largest economic lobbying groups in Japan issued a joint statement expressing their concern that the ruling would “become a barrier in pursuing investment and business opportunities in South Korea in the future.”
The South Korean government has signaled its interest to work on a compromise solution. While Prime Minister Lee Nak-yon stated that Seoul would respect the verdict, he also expressed the need for both countries to “continue working together in a bid to advance bilateral relations in a future-oriented way.”
The ruling is likely to strain relations between Japan and South Korea at a time when diplomatic and political issues on the Korean Peninsula require a cordial and well-coordinated relationship between the two countries. Japan and South Korea not only have long-standing disputes over the interpretation of Korean Peninsula’s brutal colonial history at the hands of Japan — most notably the issue of exploitation of “comfort women” by the Japanese military — but are also engaged in a territorial dispute over a set of rocky islets in the Sea of Japan.