Korea proposes fund for labor victims to Japan

Seoul proposed a plan to Tokyo to compensate victims of Japan’s wartime forced labor by establishing a fund jointly financed by Japanese and Korean companies, the Korean Ministry of Foreign Affairs said Wednesday.

The ministry announced that “it would be desirable to establish a fund financed voluntarily be related Japanese companies and Korean companies to compensate the victims,” following a thorough review on ways to resolve the issue of Japan’s mobilization of Koreans into forced labor during World War II following Korea’s top court ruling on the matter last year.

Japan has called upon Korea to form an arbitration panel involving a third party to resolve the dispute over the forced labor issue amid strained bilateral relations between the two neighboring countries.

Should Tokyo accept Seoul’s proposal, the Foreign Ministry said in a statement that the Korean government “will be willing to review accepting” the procedures laid for diplomatically settling the dispute under Article 3, Clause 1, of the 1965 bilateral claims agreement. Clause 1 stipulated that any disputes will be settled first through diplomatic channels.

A Korean Foreign Ministry official said that Korea has “recently” conveyed this position to Japan “through regular diplomatic channels.”

The Korean Supreme Court made landmark rulings last October and November that called on two Japanese companies, Nippon Steel & Sumitomo Metal and Mitsubishi Heavy Industries, to compensate Koreans forced into labor during colonial rule. Tokyo has protested the Supreme Court rulings, claiming that a 1965 treaty normalizing bilateral relations with Seoul, which provided the Korean government with an economic cooperation fund, settled all compensation matters.

Yet Korea’s top court said the Japanese government failed to acknowledge the illegality of its colonial rule and that the victims’ rights to individual compensation have not expired. This has opened up the possibility for other victims of forced labor to file similar lawsuits.

The Japanese companies refused to compensate the victims following the Korean top court ruling. In turn, the plaintiffs have taken legal steps to seize the companies’ assets in Korea.

Japan called for a bilateral diplomatic consultation to resolve the dispute based on Article 3 of the 1965 agreement in January. On May 20, Japan urged Korea to respond to a request to form an arbitration panel involving a third country within 30 days. The deadline expired Tuesday without Seoul agreeing to the arbitration panel.

On Wednesday, Tokyo again demanded an arbitration panel involving a third country be established.

“Our government will continue to work toward the resolution of the forced labor issue and history issues,” said a Korean Foreign Ministry official.

But Japanese Foreign Minister Taro Kono immediately rejected Seoul’s proposal for a joint fund of Korean and Japanese companies, reported Kyodo News Wednesday.

Takeshi Osuga, the Japanese Foreign Ministry press secretary, said Wednesday that Korea’s proposal is “not one that can resolve the problem,” and that it had conveyed this position to Seoul.

BY SARAH KIM [kim.sarah@joongang.co.kr]