Provincial court orders freeze on Japanese company’s Korea-based stakes over forced labor verdict
Jan. 10, 2019
Global Korean Post
ByOh Hyun-woo and Kim Young Shin
The Pohang branch of the Daegu District Court on Jan. 8 ordered a freeze on the Korean assets of Nippon Steel & Sumitomo Metal Corp. after the legal team for Koreans who were forced to work for the company during Japan’s colonial rule of the Korea Peninsula filed a request.
Last year on Oct. 30, the attorneys had requested the seizure of Nippon Steel’s 81,075 shares in the company’s joint venture in Pohang, PNR, with Korean steelmaker POSCO. The value of the stakes is equivalent to the damages sought by two of the victims and interest accrued.
A branch official said the process of document delivery is ongoing. The freeze order shall take effect as soon as POSCO receives the document, which means the Japanese company cannot sell, transfer or dispose of its 81,075 shares.
The order is based on the Supreme Court’s verdict in October last year that Nippon Steel must “compensate each of the victims KRW 100 million.” Last year, the plaintiffs’ legal team visited the company’s headquarters twice to request a consultation but was turned away each time.
“For now, we have concluded that Nippon Steel & Sumitomo Metal Corp. has no intent to consult with the victims and that’s why we requested that the court order the execution process (for the freeze on shares), but the plaintiffs’ legal team and supporters still seek a meeting with the company to resolve the issue,” Kim Se-eun and Lim Jae-sung, the attorneys representing the forced labor victims, said in a statement on Jan. 8. “We demand that the company swiftly agree to a meeting to protect the victims’ rights.”
The Japanese government is expected to defend Nippon Steel against the court order.
Japan’s Kyodo News said the Japanese Foreign Ministry will demand talks with its Korean counterpart after invoking for the first time an article of the 1965 treaty that normalized bilateral ties.
If both sides cannot come to an agreement on the freeze of stakes, Japan is expected to set up an arbitrator organization with a third party as a member or file an appeal with the International Court of Justice.