In a damages suit filed by South Korean former laborers against a Japanese company seeking compensation for their forced work during the Japanese colonization of the Korean Peninsula (1910-1945), the Supreme Court in Seoul issued a ruling on Oct. 30 that effectively runs counter to the 1965 Treaty on Basic Relations between Japan and the Republic of Korea. Leaving the logic of this decision unchallenged will bring the Japan-South Korea relationship into serious jeopardy.
The reparations agreement signed along with the 1965 treaty clearly states that the issues of asset ownership and the right to seek compensation were resolved "completely and finally" with Japan offering economic assistance to South Korea.
As for forced laborers, the minutes of a meeting in which the wording was agreed upon indicates that Tokyo and Seoul confirmed that no claims could be lodged for compensation. The governments of Japan and South Korea had shared the position that the issue of the right to seek compensation was settled between the two countries.
The latest decision by the South Korean Supreme Court, however, said that Japan's colonial rule was unlawful, and the act of forced labor conducted by the Japanese company during the colonial period was the target of the former workers' claim for "solatium," and the plaintiffs should be paid. The ruling is based on the view that the 1965 reparations agreement does not cover the issue of compensating former forced laborers.
The legal nature of the colonial rule was left unconfirmed as the two countries prioritized normalizing their diplomatic ties. Former South Korean Prime Minister Kim Jong-pil, who was involved in the normalization talks with Japan, wrote in his memoir that the negotiations were settled politically as the two sides acquiesced on each other's self-serving explanation of the agreement to its domestic audience.
Moreover, the administration of former President Roh Moo-hyun concluded in 2005 that compensation for forced laborers was included as "settlement money" in the 300 million dollars Tokyo paid to Seoul based on the reparations agreement. The South Korean government has compensated those workers.
Changing the interpretation of the basic treaty and the reparations agreement unilaterally, despite the past arrangements, will distort the norm set by international law, and could lead to a major confrontation between Japan and South Korea.
Besides Nippon Steel & Sumitomo Metal Corp. that was ordered to compensate the former workers, nearly 100 Japanese companies have become the targets of compensation suits filed in South Korea. It is possible that the assets of such corporations will be seized. It was no surprise that the government of Japan stated that the ruling was "completely unacceptable."
In its response, the government of South Korea stated that it "hoped to develop the South Korea-Japan relationship in a future-oriented manner" while showing "respect" for the judicial judgment. Seoul says it will consider what action to take, but one has to wonder how it would implement this contradictory ruling.
Japan, meanwhile, needs to restrain itself to avoid an emotional confrontation. But the South Korean government should realize that it has to take the lead in settling the problem.