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 When the one-year lease was up in 1937, the ships were nowhere to
be found. That year also marked the start of a full-scale war
between China and Japan.
And so began a protracted legal case which came to a head last
weekend, when a Chinese court ordered the seizure of an iron ore
carrier owned by the successor to the original Japanese company in
compensation for the loss of the two Chinese vessels.
The impoundment has created unease in Japan's government, which
warns that the action could affect Japanese businesses in China. It
remains unclear whether the sudden ruling by the Shanghai Maritime
Court would herald the seizure of more Japanese assets.
While the Chinese government describes the case as a simple business
dispute and that it has nothing to do with wartime compensation, the
court's verdict has become a cause célèbre for activists in China
fighting for what they see as much-delayed financial compensation
from Japan for its wartime deeds.
Tong Zeng, a veteran Chinese activist who has been leading the
charge for wartime compensation from Japan, said there were at least
10 other cases either in courts or going to be lodged, with many
others expected down the line.
"This is just the beginning," Tong, who has helped advise the
plaintiffs in the ship case, told Reuters on Tuesday.
In February, a case was lodged in Beijing by a group of 37 people,
including lawyers and academics as well as forced laborers and their
families, demanding compensation for Chinese citizens made by the
Japanese to work as forced laborers during World War II.
"There is the Beijing case, and now this seizure — certainly many
victims will take up legal weapons," said Tong, who oversees the
Chinese Federation of Demanding Compensation From Japan.
The Shanghai court on Saturday seized a ship owned by Japanese
shipping firm Mitsui O.S.K. Lines (MOL), saying the company had
failed to pay compensation stemming from a wartime contractual
obligation.
The details — including why the court chose to announce the seizure
at this time of heightened tensions with Japan — remain murky.
In the late 1980s, Chen Zhen and Chen Chun brought a lawsuit against
the company which later became MOL. The two descendents of Chen
Shuntong, who owned Chung Wei Steamship Co, were among other
plaintiffs seeking financial compensation in a Shanghai court for
the loss of the two vessels.
One of the ships hit a reef and sank in 1938 while another was
destroyed by a mine in 1944, according to state news agency Xinhua.
Since the 1980s, one of Chens has died, and Tong said he is no
longer able to find the original court documents he had about the
case.
Reuters has been unable to reach the plaintiffs or their lawyer for
comment. Tong said they are not currently accepting media
interviews.
The Shanghai court, in its short statement, also gave no clear
explanation for why now, after all these years, it ordered the ship
seized. It simply said mediation between the two parties had failed,
and so the seizure order was issued.
Tong said the plaintiffs had been pushing for the seizure for a
while, and that the Japanese side had thrown up all sorts of legal
objections which had finally been exhausted.
MOL said it was seeking the possibility of out-of-court settlement
when it was notified that its ship was impounded.
"It's a legal fact (what has happened), and it just happens to have
happened while we are in this environment," Tong added, referring to
the current poor relations between Beijing and Tokyo.
POISONED TIES
China's ties with Japan have long been poisoned by what Beijing sees
as Japan's failure to atone for its occupation of parts of China
before and during World War II. Japan, for its part, has looked on
warily as China strengthens its military.
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Dozens of wartime compensation suits have been filed previously in
Japan against the Japanese government and companies associated with
its aggression in the first half of the 20th century, including
World War II. Almost all have been rejected by Japanese courts.
The Japanese government insists that the issue of war reparations
was settled by the 1951 San Francisco Peace Treaty, which formally
ended the war, and by later bilateral treaties. It says all
wartime compensation issues concerning China were settled by a 1972
joint statement establishing diplomatic ties.
Some Chinese legal experts point to cases involving Germany after
World War II as setting a precedent in China now.
"Around 2007, Greece and Italy both handled forced war labor in
Germany cases for Greek and Italian citizens, and issued judgments
on their home soil," said Pan Guoping, a professor of international
law at Southwest University of Political Science and Law in
Chongqing.
"In international law, the government represents the actions of the
government or state, but that is separate from cases involving the
assets of individuals."
Xinhua said the case first went to court in 1989, dragging on for
more than two decades due to its complexity and the fact that it
happened so long ago.
MOL UNFAZED
MOL has about 10 bulkers calling at China in the next month, said
Toshiaki Tanaka, general manager of MOL's iron ore carrier division,
though he did not expect further ship seizures.
"There is only one case in dispute," he said, adding that he did not
think it would affect MOL's business in China.
The iron ore carrier, Baosteel Emotion, is on a long-term contract
between Baoshan Iron & Steel Co Ltd and MOL, transporting iron ore
from Western Australia to steel mill in Shanghai. MOL also regularly
transports cargo for iron ore miners including Vale SA and BHP
Billiton Ltd, Tanaka said.
"We have not had any comment from them," following the seizure of
the Baosteel Emotion, Takanaka said.
MOL operates daily container shipping services at Chinese ports and
is an investor in China's burgeoning liquefied natural gas sector.
MOL is a co-owner in 10 LNG carriers being built in China to
transport the fuel from the ExxonMobil project in Papua New Guinea
and Australia Pacific LNG to China.
Tong said the family who owned the two ships had tried suing for
compensation in Japan in the 1950s and 1960s, but failed.
He added that he expected MOL to pay up to get their ship released.
"If they don't pay up ... then the ship can be auctioned off," Tong
said.
Deteriorating Sino-Japan relations have been fuelled by a row over a
chain of uninhabited islands in the East China Sea.
Ties have worsened since China's creation of an air defense
identification zone over the East China Sea and Japanese Prime
Minister Shinzo Abe's December visit to the controversial Yasukuni
Shrine honoring war criminals among Japan's war dead.
(Additional reporting by Keith Wallis in Singapore;
editing by Ryan
Woo)
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