Japan in July to strengthen the control of three key semiconductor raw materials exported to South Korea, so that South Korea intends to file a complaint with the World Trade Organization (WTO). Japanese media reported that the Japanese government will invoke the GATT 21 “exceptions for security guarantees” as a rebuttal to South Korea.
South Korea said on the 11th that Japan “politically motivates” to strictly control the export of three key raw materials, and South Korea will appeal to the WTO.
According to the Japanese Yomiuri Shimbun, the premise of South Korea’s complaint is that the two sides must first negotiate. Because Japan and South Korea both agree that the gap is very large, it seems that it takes a lot of time to reach a conclusion.
Japan’s new Minister of Economy, Trade and Industry, Sugawara Ichihara refuted at a press conference yesterday, and the Japanese government’s judgment (South Korea’s response) has problems with security. “It is totally inappropriate to say that Japan’s violation of the WTO.”
The Japanese government reiterated that the regulation of export of hydrogen fluoride, etc., is a product that may be converted to military use. The reason for strengthening the control of exports is to find that South Korea has an “inappropriate case” in management.
Article 21 of the General Agreement on Tariffs and Trade (GATT) stipulates that “except for the exception of security guarantees”, it is agreed that countries should take necessary measures and discretion to protect the security interests. The Japanese government will in principle use this as a basis for refuting South Korea.
The WTO dispute settlement mechanism procedures first require the two sides to conduct consultations first. In response to South Korea’s request for consultations, Japan will, in principle, reply within 10 days whether or not to accept it; if the Japanese government accepts the consultation, the two sides will meet within 30 days.
But even if Japan accepts South Korea’s request for bilateral consultations, and because the two sides stand for surprise, the possibility of reaching a settlement is quite low.
Once the two sides negotiated dissatisfaction, the WTO will be required to set up a dispute settlement subcommittee equivalent to the first instance; if the result of the subcommittee is not accepted, it can appeal to the superior committee equivalent to the final review.
Professor Kawasaki Takashi of Japan’s Sophia University said that the future depends on whether the measures imposed by Japan apply to the provisions of Article 21 of the GATT. To prove this, the Japanese government has not yet announced the so-called “inappropriate case” of South Korea. Explain to what extent will be the focus, and it is not possible to prejudge at this stage.