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Family members of the late Yang Yeong-soo, who was conscripted to provide labor for Japan, and legal representatives of victims, hold a photo of Yang outside the Supreme Court in Seoul’s Seocho District following the conclusion of the trial. (Yonhap)

South Korea’s Supreme Court has issued yet another ruling holding Japanese companies responsible for compensating Koreans conscripted for forced labor during Japan’s colonial occupation of Korea. This ruling followed naturally from the precedent of the Supreme Court’s en banc decision in 2018.

The latest ruling once again confirms that the “third-party compensation” plan that’s being unilaterally promoted by the Yoon administration flies in the face of the judiciary’s position.

Given the growing likelihood that the plaintiffs will prevail in some 60 pending cases about forced labor, the third-party compensation plan appears to be in serious trouble. The problem is that the fund set up to compensate the victims on behalf of the Japanese companies is wholly inadequate to cover that many victims. The fault lies with Korean President Yoon Suk-yeol’s ill-considered push for the third-party compensation plan in disregard of the court’s judgment.

The second petty bench of the Supreme Court (under Justice Lee Dong-won) upheld a lower court’s ruling in a damages claim against Nippon Steel and Mitsubishi Heavy Industries. The lower court had ruled in favor of the surviving relatives of victims of forced labor during Japan’s colonization of Korea.

The latest ruling adheres to the spirit of the Supreme Court’s 2018 en banc ruling that held Japanese companies responsible for compensating forced labor based on the illegality of Japan’s colonial rule over Korea and the compulsory mobilization of the conscripted laborers.

This ruling is expected to have major ramifications for other lawsuits about forced labor, since it treats 2018 (when the Supreme Court reached its landmark en banc ruling) as the time for calculating the statute of limitations for these cases.

All of the other 60 lawsuits were filed after 2018. Mitsubishi Heavy Industries and the other defendants argued that the three-year statute of limitations had already ended, presuming that the clock began with the Supreme Court’s first ruling on compensation for forced labor in 2012, but the Supreme Court didn’t accept that argument. Instead, the Supreme Court said that victims were only capable of filing for damages after an en banc decision (which involves all the justices on the court) was rendered.

The Foundation for Victims of Forced Mobilization by Imperial Japan, which the government set up to provide third-party compensation for the victims, has only received 4 billion won donated by POSCO. Considering that around 110 people have also filed damages lawsuits, the total amount of compensation needed to be paid out is estimated to exceed 15 billion won.

When the government announced its third-party compensation plan, it pledged to set up a private-sector fund with donations from various companies, but so far the only participating company is POSCO, which was a beneficiary of economic cooperation funds provided by Japan after it normalized relations with Korea.

Unless the fund is expanded, the government may find itself in the absurd position of not even being able to carry out its third-party compensation plan. The Yoon administration has already made big concessions to Japan without having anything to show for it, and now it may have to browbeat Korean companies to make more donations to the fund.

When some of the victims rejected third-party compensation, the government attempted to force them to accept a deposit, but that effort was soon checked by the courts. Third-party compensation is already bankrupt on a legal level, and it’s now looking less and less viable on a practical level as well. The Yoon administration needs to stop insisting on the third-party compensation plan.

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