The question of compensation for South Koreans for labour during Japan’s 1910-45 occupation of the Korean peninsula has soured the US allies’ relations, which took a turn for the worse this month when Japan restricted exports of high-tech material to South Korea.

With no mutually palatable agreement, Tokyo has pushed for third party arbitration, which Seoul has rejected.

Thursday is the deadline for making those arrangements.

NHK said that once the deadline passes, Japan would continue to push Seoul for proposals to end the dispute while preparing for countermeasures – including considering going to the International Court of Justice.

The case cannot go to trial, however, without agreement South Korea, Kyodo news agency reported.

Japan initially cited the dispute over compensation for the wartime labourers as being behind what it sees as broken trust with South Korea as it announced the tighter export controls.