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Asset sale in wartime labor case would hurt Japan-S. Korea ties: Suga

Japanese Chief Cabinet Secretary Yoshihide Suga attends a press conference in Tokyo on Aug. 3, 2020. (Kyodo)

TOKYO (Kyodo) -- A Japanese company's assets seized under a South Korean court ruling on compensation for wartime labor must not be sold off to avoid further hurting Tokyo-Seoul ties, the Japanese government said Tuesday.

    Liquidating the Nippon Steel Corp. assets would bring about a "serious situation" and must be avoided, Chief Cabinet Secretary Yoshihide Suga said at a regular press conference.

    "Japan has repeatedly pressed the South Korean side on this matter, and will continue to strongly urge them to resolve the issue," the top government spokesman said.

    A branch of the Daegu District Court on Tuesday became able to start the procedure of selling off assets held in South Korea by Nippon Steel, which said the same day it will file an appeal against the move.

    Suga said Tokyo was considering a range of actions to take should the sale go ahead, but declined to specifically say whether tightening visa restrictions or recalling the ambassador in Seoul were on the table.

    "We will continue to firmly deal with the issue," he said.

    Relations between the neighboring countries have been rocky following a South Korean Supreme Court decision in October 2018 ordering Nippon Steel to compensate four South Koreans for forced labor under Japan's 1910-1945 colonial rule.

    The Daegu District Court branch in January 2019 seized the Japanese steelmaker's stake in PNR, a joint venture with South Korean steelmaker Posco.

    Japan argues the Supreme Court decision goes against a 1965 bilateral agreement signed when the countries established diplomatic ties that purported to resolve the issue of compensation "completely and finally."

    Suga reiterated Tokyo's stance that Seoul's failure to honor the agreement was a "clear violation" of international law.

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