South Korea has filed a complaint with the World Trade Organization over Japanese trade restrictions, in the latest escalation of a dispute stemming from Japan’s colonial rule over Korea that has dented security and trade relations between the key US allies.

Seoul has complained that Tokyo’s removal in July of preferential trade status for three materials critical to South Korean technology companies violated WTO rules by regulating trade for political reasons.

Tokyo has argued that the imposition of new trade controls was based on security and trust issues. However, many analysts viewed it as retaliation after South Korean courts ordered Japanese companies to pay damages over forced labour during the second world war and the government in Seoul refused to enter into arbitration over the issue.