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| The Supreme Court of Korea in Seocho District, Seoul / Yonhap |
Japan warns of serious consequences if the Supreme Court of Korea finalizes asset sell-off order.
By Nam Hyun-woo
The Supreme Court of Korea delayed making a decision on liquidating Mitsubishi Heavy Industries' assets here to compensate victims who were forced to labor for the company during Japan's 1910-1945 colonial occupation of Korea.
The decision was widely expected to mark a watershed moment in Seoul-Tokyo relations, as Japan sees the liquidation as a "red line" and has warned Korea that it would regret crossing it. As the top court deliberates on the thorny issue, it appears that the Yoon Suk-yeol government was also afforded time to explore ideas that will improve bilateral relations without further damage to the victims.
The top court is deliberating an appeal by Mitsubishi Heavy Industries against a local court's 2021 order to liquidate the company's assets to compensate the victims. However, the Supreme Court did not announce whether it will dismiss the appeal as of 5 p.m. Friday, meaning it will continue looking into the case.
The legal battle arose after two separate 2018 Supreme Court rulings ordered Japanese companies ― Nippon Steel & Sumitomo Metal (renamed Nippon Steel) and Mitsubishi Heavy Industries ― to compensate forced labor victims. In 2019, Japan imposed tighter export controls on key industrial items heading to Seoul in protest against the rulings, which soured bilateral relations.
The Japanese companies have refused to make compensatory payments.
On Sept. 27, last year, Daejeon District Court decided to liquidate Mitsubishi Heavy's assets here ― two patents and two trademark rights ― and the company appealed the ruling. After its first appeal was dismissed, the company filed another appeal on April 19 this year.
According to the Act on Special Cases Concerning Procedure for Trial by the Supreme Court, the top court can dismiss an appeal without stating the reason within four months of its filing, if the appeal does not have acceptable grounds.
Since Mitsubishi filed the appeal on April 19, the court could have dismissed the case ― and thus liquidate relevant assets ― up until Friday without stating any detailed reason.
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| In this May 2016 file photo, the logo of Mitsubishi Heavy Industries is seen at the company's news conference. Reuters-Yonhap |
Against this backdrop, Korea's foreign ministry has organized a consultative body involving government officials, victims, their legal representatives and experts to explore ideas to solve the thorny issue before the Supreme Court justices come to a decision.
However, their talks appeared to be derailing, as the victims remained unhappy with the government's idea of Seoul paying the compensation and recouping the costs via alternative methods.
The victims left the consultative body after discovering that the foreign ministry on July 26 submitted its letter of opinion to the Supreme Court without informing the victims. A number of civic groups supporting the victims claimed that the government in the letter asked the court to postpone making a final decision given potential diplomatic friction with Japan, and that this is "largely the same as Mitsubishi's stance."
Although the Supreme Court did not dismiss Mitsubishi's appeal on Friday, experts say chances are slim that the court will side with the Japanese company in the future, because the court already handed down a ruling in 2018 ordering the company to compensate the victims.
Rep. Lee Sang-min of the main opposition Democratic Party of Korea (DPK) said during Friday's National Assembly Foreign Affairs and Unification Committee meeting that "the appeal will be dismissed without further review," adding that the government's idea of a subrogated compensation would be helpful for the situation.
During the meeting, Foreign Minister Park Jin said it is "difficult to anticipate the Supreme Court's decision," but the ministry will continue listening to stakeholders and making diplomatic efforts to reach a desirable resolution of the issue.
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