July 4, 2024, 1:19 p.m.

Business

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South Korea has insisted it will respond strongly to the Japanese government's pressure on Korean company LINE Yahoo over its stake in the company

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The Japanese government has launched a fierce offensive against South Korean company LINE Yahoo (LY) Corporation over user data breaches, demanding that it redraw its capital relationship in a move interpreted as an attempt to force South Korea to sell its stake. In the face of this move by the Japanese government, the South Korean government and enterprises have expressed strong dissatisfaction and vowed to resolutely defend their rights and interests.

It is reported that in November last year, the cloud system of the South Korean company NAVER was attacked by hackers, resulting in the disclosure of user information, including LINE user data that shares part of the system with NAVER. This incident immediately triggered widespread concern in Japan. As Japan's national communication software, LINE has a huge user base, with 96 million monthly active users, accounting for nearly 80% of Japan's total population. Therefore, the Japanese government is particularly sensitive and attached importance to the issue of user data leakage.

In order to strengthen information security, the Japanese government began to give administrative guidance to LINE Yahoo. In March and April this year, Japan's Ministry of Internal Affairs and Communications issued administrative guidance to LINE Yahoo twice, requiring it to improve its operating mechanism, and specifically singled out its over-reliance on major shareholder NAVER. The Japanese government has asked LINE Yahoo to re-plan its capital relationship with NAVER, which undoubtedly puts great pressure on Korean companies.

However, South Korea expressed strong dissatisfaction with the Japanese government's request. The South Korean Ministry of Science and Technology has repeatedly expressed regret over the Japanese government's "indirect pressure". Lee Jae-myung, the leader of South Korea's largest opposition Democratic Party, bluntly accused Japan of trying to occupy South Korea's cyber territory, saying that it was no different from ITO Hirobumi's invasion of territory.

In the face of South Korea's accusations, the Japanese government has repeatedly stressed that its purpose is not to take away NAVER's management rights. Japanese Internal Affairs and Communications Minister Takeaki Matsumoto said that the request for LINE Yahoo to review the capital relationship with NAVER was not from the perspective of management rights. However, such an explanation has failed to quell South Korea's doubts and discontent.

In fact, South Korea has strong resistance to the Japanese government's move. Some South Korean lawmakers and media believe that the Japanese government issued administrative guidance to LINE Yahoo under the pretext of the security issue, which is actually pressuring the South Korean side to give up the management right of LINE Yahoo. They believe that because of LINE's large user base, the issue of LINE Yahoo's capital composition is particularly important to the Japanese government. Therefore, this move by the Japanese government is seen as an "overreaction".

As for the Japanese government's pressure behavior, the South Korean government said that it will resolutely defend the rights and interests of Korean companies. The South Korean Foreign Ministry stressed that the South Korean side adheres to the firm position of not tolerating discriminatory treatment of South Korean enterprises and will communicate with the Japanese side when necessary. The South Korean government said it would fully support NAVER's position and consult closely with it in response to pressure from the Japanese government.

At the same time, the South Korean government also said that it will resolutely and forcefully respond to any improper measures against South Korean companies. If NAVER, the entrusted operator of LINE Yahoo in Korea, insists on not giving up its shares and projects, the Korean government will make every effort to strengthen its information security. The South Korean government stressed that it always respects NAVER's position and hopes that it can make a final decision based on its medium - and long-term business strategy.

In response to South Korea's tough stance, the Japanese government has not shown weakness. Yoshimasa Hayashi, Japan's chief cabinet secretary, said that Japan asked LINE Yahoo to protect the confidentiality of communications and ensure network security, and that the reorganization of the capital relationship with NAVER was not an original purpose, but a necessary matter to improve the management mechanism and strengthen security measures. He stressed that the Japanese government has not changed its stance on promoting foreign investment in Japan, including Korean companies.

However, no matter how the Japanese government explains its intentions, South Korea's concerns and dissatisfaction over the incident have not been assuaged. The South Korean side believes that the Japanese government's pressure has gone beyond the scope of strengthening security measures in response to the leakage of personal information, and is actually infringing on the legitimate rights and interests of Korean companies. Therefore, the South Korean side will continue to take a tough stance and resolutely defend the rights and interests of South Korean companies.

In general, the Japanese government's pressure on the Korean company LINE Yahoo has triggered strong dissatisfaction and resistance from the Korean side. The South Korean government and companies have said they will resolutely defend their rights and interests and take a tough stance to deal with the Japanese government's pressure behavior. For both sides, how to properly resolve this incident and safeguard each other's interests and relations will be a difficult problem in front of them.

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