Tokyo, Japan - Japan summoned South Korea's ambassador on Wednesday to protest a compensation payment by a Japanese company related to the thorny issue of wartime forced labor.

Japan's Chief Cabinet Secretary Yoshimasa Hayashi speaks during a press conference at the Prime Minister's Office in Tokyo on February 21, 2024. (Photo by JIJI PRESS / AFP)

The countries have long been locked in a bitter dispute over Japan's use of forced labor during its brutal decades-long occupation of the Korean peninsula before and during World War II.

Ties have been improving under Korean President Yoon Suk Yeol, however, who last year unveiled a plan to compensate victims without direct involvement from Japan.

The family of a South Korean victim who won a wartime labour case against Japanese shipbuilder Hitachi Zosen in December received money from the firm this week.

The money was retrieved from a deposit provided by the firm to a court in Seoul, after South Korea's top court in December ordered Hitachi Zosen to pay 50 million South Korean won ($37,500) in compensation to the victim.

The indirect payment -- the first of its kind -- has drawn condemnation from Japan, which maintains that the forced labour dispute was settled in a 1965 treaty.

Japan's vice foreign minister on Wednesday "summoned South Korean ambassador to Japan Yun Duk Min and lodged a strong protest", top government spokesman Yoshimasa Hayashi told reporters.

The retrieval of the payment "imposes an unfair disadvantage to a Japanese company based on a verdict that clearly violates" the 1965 deal, Hayashi said.

Around 780,000 Koreans were conscripted into forced wartime labor by Japan, according to data from Seoul, not including women forced into sexual slavery by Japanese troops.

Japan has argued that the 1965 treaty, which included a reparation package of about $800 million in grants and cheap loans, extinguished victims' right to sue.

Yoon's domestically unpopular moves to bury the historical hatchet are partly an attempt to confront growing military threats from North Korea jointly with Japan.

Meeting on the sidelines of the G20 summit in Rio de Janeiro on Wednesday, Japanese Foreign Minister Yoko Kamikawa and her South Korean counterpart Cho Tae Yul emphasized continued cooperation on Pyongyang.

"The two ministers exchanged their views on North Korea, which continues provocative actions, and concurred to continue to work together," the Japanese Foreign Ministry said in a statement posted to X, formerly Twitter.

However, Kamikawa also "expressed strong regret regarding the Hitachi Zosen case, as it inflicts unjustifiable damages and costs on the said company," the statement said.

Over the past year, Yoon and Japanese Prime Minister Fumio Kishida have resumed regular high-level talks, with Yoon in Tokyo in April and Kishida travelling to Seoul in May.

Contacted by AFP, a spokesman for Hitachi Zosen said the company's position on the issue "remains unchanged", that the December verdict by South Korea's top court "is extremely regrettable as it is against the 1965 treaty, and against the Japanese government's and the firm's" views on the issue.