Japan to tighten export rules for OLED materials to Korea

The Japanese government will on July 4th announce fresh sanctions against South Korea over South Korean ruling on war-time forced labor, the Sankei newspaper reported on Sun. The sanction as per reports will ban/restrict the export of semiconductor materials and OLED display panel materials from Japan to Korea.

The sanctions which take effect from the 4th day of July will place export restrictions on three categories to South Korea, namely, fluorinated polyimides applicable in TV and mobile OLED panels, photoresist applicable in semiconductor manufacturing and high-purity hydrogen fluoride (Etching Gas). It is reported that Japan accounts for a larger amount of the market need of fluoropolyimide and hydrogen fluoride materials, accounting for 90% and 70% of the global market respectively.

Companies from South Korea are highly reliant on these materials, and a ban on either could hit the country’s economy really hard. Korean chaebols Samsung and LG, as well as other Korean tech firms, would be at the receiving end, while supplies to other firms reliant of the end products including Apple, Google, Sony, Huawei, OPPO, vivo, and more would be greatly hindered.

The row between Japan and South Korea flared last October when South Korea’s Supreme Court ruled that Japan’s Nippon Steel must compensate South Koreans for forced labor during World War Two. Japan maintains that the issue of forced labor was fully settled in 1965 when the two countries restored diplomatic ties and has denounced the ruling as “unreasonable.”

An official pronouncement will be made on Monday. After which Japanese exporters will need to apply for export permission for each time they want to ship to South Korea, which takes about 90 days, the paper said.