Japan will restrict the export of some materials used in smartphones and chips to South Korea

Japan’s trade ministry said today that it will restrict the export of some tech materials to South Korea, including polyimides used in flexible displays made by companies like Samsung Electronics. The new rules come as the two countries argue over compensation for South Koreans forced to work in Japanese factories during World War II.

The list of restricted supplies, expected to go into effect on July 4, includes polyimides used in smartphone and flexible organic LED displays, and etching gas and resist used to make semiconductors. That means Japanese suppliers who wish to sell those materials to South Korean tech companies such as Samsung, LG and SK Hynix will need to submit each contract for approval.

Japan’s government may also remove South Korea from its list of countries that have fewer restrictions on trading technology that might have national security implications, reports Nikkei Asian Review.

Earlier this year, South Korea’s Supreme Court ruled several Japanese companies, including Nippon Steel & Sumitomo Metal Corp. and Mitsubishi Heavy Industries, that had used forced labor during World War II must pay compensation and began seizing assets for liquidation. But Japan’s government claims the issue was settled in 1965 as part of a treaty that restored basic diplomatic relations between the two countries and is asking South Korea to put the matter before an international arbitration panel instead.