"Met Japan's demands, explained 'faithfully and sufficiently'"
"Requested panel installation at WTO, proceeding according to procedure"
"Exerting all efforts to address uncertainties in companies and GVC"
The 12th Korea-China-Japan Economic and Trade Ministers' Meeting held last year. Minister Sung Yun-mo of the Ministry of Trade, Industry and Energy (left) and Hiroshi Kajiyama, Minister of Economy, Trade and Industry of Japan (right), shaking hands. There is still a long and difficult road ahead to resolve export regulations between Korea and Japan. (Photo by Ministry of Trade, Industry and Energy)
[Asia Economy Reporter Moon Chaeseok] South Korea has decided to re-file a complaint against Japan at the World Trade Organization (WTO). It will initiate WTO dispute settlement procedures regarding export restrictions on three items: EUV photoresist, fluorinated polyimide, and hydrogen fluoride.
On the 2nd, Na Seung-sik, Director of the Trade and Investment Office at the Ministry of Trade, Industry and Energy, held a press conference at the Government Complex Sejong and announced this decision.
Director Na stated, "Our government has decided to resume the WTO dispute settlement procedures concerning Japan's export restrictions on the three items, which had been provisionally suspended since November 22 of last year."
The South Korean government judged that despite Korea having 'faithfully and sufficiently' met and explained the demands made by Japan, Japan has not been conducting 'normal dialogue.'
'Conducting normal dialogue' was originally a condition for suspending the WTO dispute settlement procedures.
According to Director Na, on November 22 of last year, the governments of South Korea and Japan resumed director-general level policy dialogues. During the export control discussions between the two countries, the WTO dispute settlement procedures regarding Japan's strengthened export restrictions on the three major items were provisionally suspended.
Director Na emphasized that over the past six months, the South Korean government has 'faithfully and sufficiently' explained so that Japan could understand that Korea's export control is operating normally and effectively.
He recalled that Korea has thoroughly resolved three demands from Japan: ▲ suspension of Korea-Japan policy dialogue ▲ insufficient catch-all controls on conventional weapons ▲ inadequacies in export control organization and personnel.
Regarding the three items, it was stated that during the 11 months of operation, no security concerns cited by Japan as reasons for export restrictions have occurred.
In other words, South Korea has clearly blocked Japan's justification for continuing export restrictions.
Director Na said, "We plan to request the establishment of a panel at the WTO for this case and proceed with the subsequent procedures," adding, "Through the WTO dispute settlement process, we will objectively prove the illegality and unfairness of Japan's export restrictions on the three items."
He continued, "We will concentrate all our capabilities to protect the legitimate interests of our companies and to promptly resolve the uncertainties cast over companies in both countries and the global value chain (GVC)."
Once the complainant country, South Korea, requests the WTO to establish a panel, the procedure restarts, and it typically takes about two years to reach a first-instance ruling. If either country rejects the panel report, the Appellate Body makes the final decision.
However, with six of the seven WTO Appellate Body members' seats vacant, the Appellate Body is effectively paralyzed. Since the United States is strongly demanding reforms of the Appellate Body, it is expected to take considerable time before normal operations resume.
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