Seoul’s Diplomatic Approach to Naver-LY Corp. Issue Under Fire
In the bustling streets of Tokyo, passerby might glimpse the towering presence of Tokyo Garden Terrace Kioi Tower, the headquarters of LY Corp., a company renowned for its popular mobile messaging app, Line. Behind the scenes, a political maelstrom brews as Korean politicians lambaste the perceived passivity of Seoul’s response to the pressure exerted by Tokyo on Korean tech titan Naver to divest its stake in LY Corp.
Politicians from both Korea’s ruling and opposition parties have not minced words, describing the government’s diplomacy as “miserable.” They argue that Japan seems to be engaging in a form of technological “extortion” involving the widely-used app, which boasts around 180 million active users across Japan and Southeast Asia.
Their concerns stem from the Japanese government’s administrative guidance to LY Corp. This came after a significant data leak of user information, leading to speculation that the guidance is a subtle yet potent push to diminish Naver’s influence over LY. Amidst this, SoftBank, a co-owner of LY alongside Naver, has publicly acknowledged ongoing discussions regarding the future control of the joint venture.
At a press conference, People Power Party (PPP) Representative Yoon Sang-hyun urged the Korean government to abandon its hands-off stance, emphasizing the need for proactive engagement to shield Korean companies in foreign markets and mitigate potential diplomatic repercussions with Japan.
Adding to the chorus, former PPP lawmaker Yoo Seong-min took to social media, condemning the Japanese government’s coercive tactics as a violent deviation from the tenets of capitalist market economies. He called for robust protests from the president and the foreign ministry to buttress Naver’s negotiating position.
Meanwhile, the main opposition Democratic Party of Korea (DPK) has gone as far as labeling the government’s response a “diplomatic disaster,” with spokesperson No Jong-myeon critiquing the absence of a firm protest against Japan’s attempts to gain control over Line from Naver. No highlighted the stakes involved, framing the situation as a potential loss of Korean-developed technology to Japan.
In a gesture of protest against what he perceives as submissive diplomacy from the Yoon Suk Yeol administration, minor opposition Rebuilding Korea Party Chairman Cho Kuk announced plans to visit Dokdo, an island at the heart of a territorial dispute with Japan. Lee Hai-min, a lawmaker-elect from the same party, echoed Cho’s sentiments, questioning President Yoon’s allegiance.
As the debate intensifies, both the foreign and ICT ministries of Korea have signaled a shift towards a proactive stance. Second Vice ICT Minister Kang Do-hyun expressed regret over the Japanese government’s actions, suggesting they are interpreted as coercing a stake sell-off. Firm measures are promised should Korean companies face unwarranted treatment.
Foreign Minister Cho Tae-yul, speaking at a joint meeting of consulting groups from the foreign and ICT ministries, stressed the importance of a unified strategic response that intertwines economy, security, and technology, all in the nation’s best interests. The government’s commitment to closely communicate with Naver and respect its managerial decisions was also reaffirmed.
