Japan slaps restrictions on tech exports to South Korea

Move amid wartime labor row threatens to snarl up supply chains

South Korea's Supreme Court has ordered Japanese companies to pay compensation for their use of wartime labor, straining the countries' ties.

JUNICHI SUGIHARA and KENICHI YAMADA, Nikkei staff writers

July 1, 2019 14:38 JST

Updated on July 1, 2019 17:05 JST

TOKYO/SEOUL -- The Japanese government on Monday announced it will tighten restrictions on exports of semiconductor manufacturing materials to South Korea, in a move that could hinder Asian supply chains.

Japan's trade ministry said the decision came in response to what it deemed the "occurrence of an inappropriate matter." But the ministry did not clarify what that means, and the restrictions at least appear to be a reaction to Seoul's stance on a dispute over compensation for wartime labor. This could leave Japan vulnerable to accusations that it is abusing international trade rules.